Document_and_Entity_Informatio
Document and Entity Information (USD $) | 12 Months Ended | ||
Dec. 31, 2013 | Feb. 07, 2014 | Jun. 28, 2013 | |
Document And Entity Information [Abstract] | ' | ' | ' |
Entity Registrant Name | 'HERSHEY CO | ' | ' |
Entity Central Index Key | '0000047111 | ' | ' |
Current Fiscal Year End Date | '--12-31 | ' | ' |
Entity Filer Category | 'Large Accelerated Filer | ' | ' |
Document Type | '10-K | ' | ' |
Document Period End Date | 31-Dec-13 | ' | ' |
Document Fiscal Year Focus | '2013 | ' | ' |
Document Fiscal Period Focus | 'FY | ' | ' |
Amendment Flag | 'false | ' | ' |
Entity Well-known Seasoned Issuer | 'Yes | ' | ' |
Entity Current Reporting Status | 'Yes | ' | ' |
Entity Voluntary Filers | 'No | ' | ' |
Entity Common Stock, Shares Outstanding | ' | 223,805,223 | ' |
Entity Public Float | ' | ' | $13,339,990,293 |
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 |
Net Sales | $7,146,079 | $6,644,252 | $6,080,788 |
Costs and Expenses | ' | ' | ' |
Cost of sales | 3,865,231 | 3,784,370 | 3,548,896 |
Selling, marketing and administrative | 1,922,508 | 1,703,796 | 1,477,750 |
Business realignment and impairment charges (credits), net | 18,665 | 44,938 | -886 |
Total costs and expenses | 5,806,404 | 5,533,104 | 5,025,760 |
Income before Interest and Income Taxes | 1,339,675 | 1,111,148 | 1,055,028 |
Interest expense, net | 88,356 | 95,569 | 92,183 |
Income before Income Taxes | 1,251,319 | 1,015,579 | 962,845 |
Provision for income taxes | 430,849 | 354,648 | 333,883 |
Net Income | $820,470 | $660,931 | $628,962 |
Average Shares Outstanding - Diluted | 227,203 | 228,337 | 229,919 |
Common Stock | ' | ' | ' |
Costs and Expenses | ' | ' | ' |
Earnings Per Share - Basic | $3.76 | $3.01 | $2.85 |
Earnings Per Share - Diluted | $3.61 | $2.89 | $2.74 |
Average Shares Outstanding - Basic - Common Stock | 163,549 | 164,406 | 165,929 |
Cash Dividends Paid Per Share | ' | ' | ' |
Common Stock | $1.81 | $1.56 | $1.38 |
Common Class B | ' | ' | ' |
Costs and Expenses | ' | ' | ' |
Earnings Per Share - Basic | $3.39 | $2.73 | $2.58 |
Earnings Per Share - Diluted | $3.37 | $2.71 | $2.56 |
Average Shares Outstanding - Basic - Common Stock | 60,627 | 60,630 | 60,645 |
Cash Dividends Paid Per Share | ' | ' | ' |
Common Stock | $1.63 | $1.41 | $1.25 |
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 |
Net Income | $820,470 | $660,931 | $628,962 |
Other comprehensive income (loss), net of tax: | ' | ' | ' |
Foreign currency translation adjustments | -26,003 | 7,714 | -21,213 |
Pension and postretirement benefit plans | 166,403 | -9,634 | -85,823 |
Cash flow hedges, net of tax: | ' | ' | ' |
Gains (Losses) on cash flow hedging derivatives | 72,334 | -868 | -107,713 |
Reclassification adjustments | 5,775 | 60,043 | -12,515 |
Total other comprehensive income (loss), net of tax | 218,509 | 57,255 | -227,264 |
Comprehensive Income | $1,038,979 | $718,186 | $401,698 |
CONSOLIDATED_BALANCE_SHEETS
CONSOLIDATED BALANCE SHEETS (USD $) | Dec. 31, 2013 | Dec. 31, 2012 |
In Thousands, unless otherwise specified | ||
Current Assets | ' | ' |
Cash and cash equivalents | $1,118,508 | $728,272 |
Accounts receivable - trade | 477,912 | 461,383 |
Inventories | 659,541 | 633,262 |
Deferred income taxes | 52,511 | 122,224 |
Prepaid Expense and Other | 178,862 | 168,344 |
Total current assets | 2,487,334 | 2,113,485 |
Net property, plant and equipment | 1,805,345 | 1,674,071 |
Goodwill | 576,561 | 588,003 |
Other Intangibles | 195,244 | 214,713 |
Deferred Income Taxes | 0 | 12,448 |
Other Assets | 293,004 | 152,119 |
Total assets | 5,357,488 | 4,754,839 |
Current Liabilities | ' | ' |
Accounts Payable | 461,514 | 441,977 |
Accrued liabilities | 699,722 | 650,906 |
Accrued income taxes | 79,911 | 2,329 |
Short-term debt | 165,961 | 118,164 |
Current portion of long-term debt | 914 | 257,734 |
Total current liabilities | 1,408,022 | 1,471,110 |
Long-term Debt | 1,795,142 | 1,530,967 |
Other Long-term Liabilities | 434,068 | 668,732 |
Deferred Income Taxes | 104,204 | 35,657 |
Total liabilities | 3,741,436 | 3,706,466 |
The Hershey Company Stockholder's Equity | ' | ' |
Preferred Stock, Value, Issued | 0 | 0 |
Common Stock, Value, Issued | 299,281 | 299,272 |
Class B Common Stock, shares | 60,620 | 60,629 |
Additional Paid in Capital | 664,944 | 592,975 |
Retained earnings | 5,454,286 | 5,027,617 |
Treasury-Common Stock shares at cost | -4,707,730 | -4,558,668 |
Accumulated other comprehensive loss | -166,567 | -385,076 |
The Hershey Company Total Stockholders' Equity | 1,604,834 | 1,036,749 |
Noncontrolling interests in subsidiaries | 11,218 | 11,624 |
Total stockholders' equity | 1,616,052 | 1,048,373 |
Total liabilities and stockholders' equity | $5,357,488 | $4,754,839 |
CONSOLIDATED_BALANCE_SHEETS_Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) | Dec. 31, 2013 | Dec. 31, 2012 |
Class of Stock [Line Items] | ' | ' |
Preferred Stock, shares issued | 0 | 0 |
Common Stock, shares issued | 359,901,744 | 359,901,744 |
Treasury Common Stock Shares At Cost | 136,007,023 | 136,115,714 |
Common Stock | ' | ' |
Class of Stock [Line Items] | ' | ' |
Common Stock, shares issued | 299,281,527 | 299,272,927 |
Common Class B | ' | ' |
Class of Stock [Line Items] | ' | ' |
Common Stock, shares issued | 60,620,217 | 60,628,817 |
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 |
Adjustments to Reconcile Net Income to Net Cash Provided from Operations | ' | ' | ' |
Depreciation and amortization | $201,033 | $210,037 | $215,763 |
Share-based Compensation | 53,967 | 50,482 | 43,468 |
Excess tax benefits from exercise of stock options | -48,396 | -33,876 | -13,997 |
Deferred income taxes | 7,457 | 13,785 | 33,611 |
Gain on sale of trademark licensing rights, net of tax | 0 | 0 | -11,072 |
Business realignment and impairment charges, net of tax | 0 | 38,144 | 34,660 |
Contributions to pension plans | -57,213 | -44,208 | -31,671 |
Changes in assets and liabilities, net of effects from business acquisitions and divestitures | ' | ' | ' |
Accounts receivable - trade | -16,529 | -50,470 | -9,438 |
Inventories | -26,279 | 26,598 | -115,331 |
Accounts payable | 13,417 | 21,739 | 7,860 |
Other assets and liabilities | 240,478 | 201,665 | -194,948 |
Net Cash Flows Provided from Operating Activities | 1,188,405 | 1,094,827 | 587,867 |
Cash Flows Provided from (Used by) Investing Activities | ' | ' | ' |
Capital Additions | -323,551 | -258,727 | -323,961 |
Capitalized Software Additions | -27,360 | -19,239 | -23,606 |
Proceeds from sales of property, plant and equipment | 15,331 | 453 | 312 |
Proceeds from sale of trademark licensing rights | 0 | 0 | 20,000 |
Payments for Advance to Affiliate | -16,000 | -23,000 | -7,000 |
Business acquisition | 0 | -172,856 | -5,750 |
Net Cash Flows (Used by) Investing Activities | -351,580 | -473,369 | -340,005 |
Cash Flows Provided from (Used by) Financing Activities | ' | ' | ' |
Net increase in short-term debt | 54,351 | 77,698 | 10,834 |
Long-term borrowings | 250,595 | 4,025 | 249,126 |
Repayment of long-term debt | -250,761 | -99,381 | -256,189 |
Proceeds from lease financing agreement | 0 | 0 | 47,601 |
Payments of Ordinary Dividends, Common Stock | -393,801 | -341,206 | -304,083 |
Exercise of stock options | 147,255 | 261,597 | 184,411 |
Excess tax benefits from exercise of stock options | 48,396 | 33,876 | 13,997 |
Payments to Acquire Additional Interest in Subsidiaries | 0 | -15,791 | 0 |
Contributions from Noncontrolling Interests | 2,940 | 2,940 | 0 |
Repurchase of Common Stock | -305,564 | -510,630 | -384,515 |
Net Cash Flows (Used by) Financing Activities | -446,589 | -586,872 | -438,818 |
Increase (Decrease) in Cash and Cash Equivalents | 390,236 | 34,586 | -190,956 |
Cash and Cash Equivalents, beginning of period | 728,272 | 693,686 | 884,642 |
Cash and Cash Equivalents, end of period | 1,118,508 | 728,272 | 693,686 |
Interest Paid | 92,551 | 100,269 | 97,892 |
Income Taxes Paid | 373,902 | 327,230 | 292,315 |
Statement [Line Items] | ' | ' | ' |
Net Income | $820,470 | $660,931 | $628,962 |
CONSOLIDATED_STATEMENTS_OF_CAS1
CONSOLIDATED STATEMENTS OF CASH FLOWS (Parenthetical) (USD $) | 12 Months Ended | ||
Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | |
Gain on sale of trademark licensing rights, net of tax of | $0 | $0 | $5,962,000 |
CONSOLIDATED_STATEMENT_OF_STOC
CONSOLIDATED STATEMENT OF STOCKHLDRS' EQUITY (USD $) | Total | Preferred Stock | Common Stock | Common Class B | Additional Paid-in Capital | Retained Earnings | Treasury Common Stock | Accumulated Other Comprehensive Income (Loss) | Noncontrolling Interest in Subsidiaries | Total Stockholders' Equity |
In Thousands | ||||||||||
Total stockholders' equity at Dec. 31, 2010 | ' | $0 | $299,195 | $60,706 | $434,865 | $4,383,013 | ($4,052,101) | ($215,067) | $35,285 | $945,896 |
Net Income | 628,962 | ' | ' | ' | ' | 628,962 | ' | ' | ' | 628,962 |
Other Comprehensive Income (Loss), Net of Tax | -227,264 | ' | ' | ' | ' | ' | ' | -227,264 | ' | -227,264 |
Dividends | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Common Stock | ' | ' | ' | ' | ' | -228,269 | ' | ' | ' | -228,269 |
Class B Common Stock | ' | ' | ' | ' | ' | -75,814 | ' | ' | ' | -75,814 |
Conversion of Class B Common Stock into Common Stock | ' | ' | 74 | -74 | ' | ' | ' | ' | ' | 0 |
Incentive plan transactions | ' | ' | ' | ' | -15,844 | ' | 14,306 | ' | ' | -1,538 |
Stock-based compensation | ' | ' | ' | ' | 40,439 | ' | ' | ' | ' | 40,439 |
Exercise of stock options | ' | ' | ' | ' | 31,357 | ' | 163,348 | ' | ' | 194,705 |
Repurchase of Common Stock | ' | ' | ' | ' | ' | ' | -384,515 | ' | ' | -384,515 |
Purchase of noncontrolling interest in subsidiary | 0 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Noncontrolling Interest, Period Increase (Decrease) | ' | ' | ' | ' | ' | ' | ' | ' | -11,659 | -11,659 |
Total stockholders' equity at Dec. 31, 2011 | ' | 0 | 299,269 | 60,632 | 490,817 | 4,707,892 | -4,258,962 | -442,331 | 23,626 | 880,943 |
Net Income | 660,931 | ' | ' | ' | ' | 660,931 | ' | ' | ' | 660,931 |
Other Comprehensive Income (Loss), Net of Tax | 57,255 | ' | ' | ' | ' | ' | ' | 57,255 | ' | 57,255 |
Dividends | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Common Stock | ' | ' | ' | ' | ' | -255,596 | ' | ' | ' | -255,596 |
Class B Common Stock | ' | ' | ' | ' | ' | -85,610 | ' | ' | ' | -85,610 |
Conversion of Class B Common Stock into Common Stock | ' | ' | 3 | -3 | ' | ' | ' | ' | ' | 0 |
Incentive plan transactions | ' | ' | ' | ' | -24,230 | ' | 12,379 | ' | ' | -11,851 |
Stock-based compensation | ' | ' | ' | ' | 49,175 | ' | ' | ' | ' | 49,175 |
Exercise of stock options | ' | ' | ' | ' | 88,258 | ' | 198,545 | ' | ' | 286,803 |
Repurchase of Common Stock | ' | ' | ' | ' | ' | ' | -510,630 | ' | ' | -510,630 |
Purchase of noncontrolling interest in subsidiary | 15,791 | ' | ' | ' | -11,045 | ' | ' | ' | -4,746 | -15,791 |
Noncontrolling Interest, Period Increase (Decrease) | ' | ' | ' | ' | ' | ' | ' | ' | -7,256 | -7,256 |
Total stockholders' equity at Dec. 31, 2012 | 1,048,373 | 0 | 299,272 | 60,629 | 592,975 | 5,027,617 | -4,558,668 | -385,076 | 11,624 | 1,048,373 |
Net Income | 820,470 | ' | ' | ' | ' | 820,470 | ' | ' | ' | 820,470 |
Other Comprehensive Income (Loss), Net of Tax | 218,509 | ' | ' | ' | ' | ' | ' | 218,509 | ' | 218,509 |
Dividends | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Common Stock | ' | ' | ' | ' | ' | -294,979 | ' | ' | ' | -294,979 |
Class B Common Stock | ' | ' | ' | ' | ' | -98,822 | ' | ' | ' | -98,822 |
Conversion of Class B Common Stock into Common Stock | ' | ' | 9 | -9 | ' | ' | ' | ' | ' | 0 |
Incentive plan transactions | ' | ' | ' | ' | -29,333 | ' | 21,268 | ' | ' | -8,065 |
Stock-based compensation | ' | ' | ' | ' | 52,465 | ' | ' | ' | ' | 52,465 |
Exercise of stock options | ' | ' | ' | ' | 48,837 | ' | 135,234 | ' | ' | 184,071 |
Repurchase of Common Stock | ' | ' | ' | ' | ' | ' | -305,564 | ' | ' | -305,564 |
Purchase of noncontrolling interest in subsidiary | 0 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Noncontrolling Interest, Period Increase (Decrease) | ' | ' | ' | ' | ' | ' | ' | ' | -406 | -406 |
Total stockholders' equity at Dec. 31, 2013 | $1,616,052 | $0 | $299,281 | $60,620 | $664,944 | $5,454,286 | ($4,707,730) | ($166,567) | $11,218 | $1,616,052 |
SUMMARY_OF_SIGNIFICANT_ACCOUNT
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 12 Months Ended | |
Dec. 31, 2013 | ||
Accounting Policies [Abstract] | ' | |
Summary of Significant Accounting Policies | ' | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | ||
Our significant accounting policies are discussed below and in other notes to the consolidated financial statements. | ||
Principles of Consolidation | ||
Our consolidated financial statements include the accounts of the Company and our majority-owned subsidiaries and entities in which we have a controlling financial interest after the elimination of intercompany accounts and transactions. We have a controlling financial interest if we own a majority of the outstanding voting common stock and minority shareholders do not have substantive participating rights, we have significant control over an entity through contractual or economic interests in which we are the primary beneficiary or we have the power to direct the activities that most significantly impact the entity's economic performance. For information on our noncontrolling interests see Note 4, Noncontrolling Interests in Subsidiaries. | ||
Equity Investments | ||
We use the equity method of accounting when we have a 20% to 50% interest in other companies and exercise significant influence. Under the equity method, original investments are recorded at cost and adjusted by our share of undistributed earnings or losses of these companies. Total equity investments were $39.9 million as of December 31, 2013, and $39.2 million as of December 31, 2012. Equity investments are included in other assets in the Consolidated Balance Sheets. Equity investments are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of the investments may not be recoverable. In May 2007, we entered into a manufacturing agreement in China with Lotte Confectionery Company, LTD. to produce Hershey products and certain Lotte products for the markets in Asia, particularly China. We own a 44% interest in this entity. We made loans to this affiliate of the Company of $16.0 million in 2013, $23.0 million in 2012 and $7.0 million in 2011 to finance the expansion of manufacturing capacity. | ||
Use of Estimates | ||
The preparation of financial statements in conformity with U.S. generally accepted accounting principles (“GAAP”) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements, and revenues and expenses during the reporting period. Critical accounting estimates involved in applying our accounting policies are those that require management to make assumptions about matters that are highly uncertain at the time the accounting estimate was made and those for which different estimates reasonably could have been used for the current period. Critical accounting estimates are also those which are reasonably likely to change from period to period and would have a material impact on the presentation of our financial condition, changes in financial condition or results of operations. Our most critical accounting estimates pertain to accounting policies for accrued liabilities, pension and other post-retirement benefit plans, goodwill and other intangible assets, commodities futures and options contracts, and income taxes. | ||
These estimates and assumptions are based on management’s best judgment. Management evaluates its estimates and assumptions on an ongoing basis using historical experience and other factors, including the current economic environment, which management believes to be reasonable under the circumstances. We adjust such estimates and assumptions when facts and circumstances dictate. Volatile credit, equity, foreign currency, commodity and energy markets, and changing macroeconomic conditions have combined to increase the uncertainty inherent in such estimates and assumptions. As future events and their effects cannot be determined with precision, actual results could differ significantly from these estimates. Changes in these estimates resulting from continuing changes in the economic environment will be reflected in the financial statements in future periods. | ||
Revenue Recognition | ||
We record sales when all of the following criteria have been met: | ||
l | A valid customer order with a fixed price has been received; | |
l | The product has been delivered to the customer; | |
l | There is no further significant obligation to assist in the resale of the product; and | |
l | Collectability is reasonably assured. | |
Net sales include revenue from the sale of finished goods and royalty income, net of allowances for trade promotions, consumer coupon programs and other sales incentives, and allowances and discounts associated with aged or potentially unsaleable products. Trade promotions and sales incentives primarily include reduced price features, merchandising displays, sales growth incentives, new item allowances and cooperative advertising. | ||
Cost of Sales | ||
Cost of sales represents costs directly related to the manufacture and distribution of our products. Primary costs include raw materials, packaging, direct labor, overhead, shipping and handling, warehousing and the depreciation of manufacturing, warehousing and distribution facilities. Manufacturing overhead and related expenses include salaries, wages, employee benefits, utilities, maintenance and property taxes. | ||
Selling, Marketing and Administrative | ||
Selling, marketing and administrative expenses represent costs incurred in generating revenues and in managing our business. Such costs include advertising and other marketing expenses, salaries, employee benefits, incentive compensation, research and development, travel, office expenses, amortization of capitalized software and depreciation of administrative facilities. | ||
Cash Equivalents | ||
Cash equivalents consist of highly liquid debt instruments, time deposits and money market funds with original maturities of 3 months or less. The fair value of cash and cash equivalents approximates the carrying amount. | ||
Commodities Futures and Options Contracts | ||
We enter into commodities futures and options contracts and other commodity derivative instruments to reduce the effect of price fluctuations associated with the purchase of raw materials, energy requirements and transportation services. We report the effective portion of the gain or loss on a derivative instrument designated and qualifying as a cash flow hedging instrument as a component of other comprehensive income and reclassify such gains or losses into earnings in the same period or periods during which the hedged transactions affect earnings. The remaining gain or loss on the derivative instrument, if any, must be recognized currently in earnings. | ||
For a derivative designated as hedging the exposure to changes in the fair value of a recognized asset or liability or a firm commitment (referred to as a fair value hedge), the gain or loss must be recognized in earnings in the period of change together with the offsetting loss or gain on the hedged item attributable to the risk being hedged. The effect of that accounting is to reflect in earnings the extent to which the hedge is not effective in achieving offsetting changes in fair value. | ||
All derivative instruments which we are currently utilizing are designated and accounted for as cash flow hedges, except for out of the money options contracts on certain commodities. These include commodities futures and options contracts and other commodity derivative instruments. Additional information with regard to accounting policies associated with derivative instruments is contained in Note 6, Derivative Instruments and Hedging Activities. | ||
Property, Plant and Equipment | ||
Property, plant and equipment are stated at cost and depreciated on a straight-line basis over the estimated useful lives of the assets, as follows: 3 to 15 years for machinery and equipment; and 25 to 40 years for buildings and related improvements. Maintenance and repairs are expensed as incurred. We capitalize applicable interest charges incurred during the construction of new facilities and production lines and amortize these costs over the assets’ estimated useful lives. | ||
We review long-lived assets for impairment whenever events or changes in circumstances indicate that the carrying amount of such assets may not be recoverable. We measure the recoverability of assets to be held and used by a comparison of the carrying amount of long-lived assets to future undiscounted net cash flows expected to be generated. If these assets are considered to be impaired, we measure impairment as the amount by which the carrying amount of the assets exceeds the fair value of the assets. We report assets held for sale or disposal at the lower of the carrying amount or fair value less cost to sell. | ||
Asset Retirement Obligations | ||
Asset retirement obligations generally apply to legal obligations associated with the retirement of a tangible long-lived asset that result from the acquisition, construction or development and normal operation of a long-lived asset. We assess asset retirement obligations on a periodic basis. We recognize the fair value of a liability for an asset retirement obligation in the period in which it is incurred if a reasonable estimate of fair value can be made. We capitalize associated asset retirement costs as part of the carrying amount of the long-lived asset. | ||
Goodwill and Other Intangible Assets | ||
We classify intangible assets into 3 categories: (1) intangible assets with finite lives subject to amortization; (2) intangible assets with indefinite lives not subject to amortization; and (3) goodwill. | ||
Our intangible assets with finite lives consist primarily of certain trademarks, customer-related intangible assets and patents obtained through business acquisitions. We are amortizing trademarks with finite lives over their estimated useful lives of approximately 25 years. We are amortizing customer-related intangible assets over their estimated useful lives of approximately 15 years. We are amortizing patents over their remaining legal lives of approximately 5 years. We conduct impairment tests when events or changes in circumstances indicate that the carrying value of these assets may not be recoverable. Undiscounted cash flow analyses are used to determine if an impairment exists. If an impairment is determined to exist, the loss is calculated based on the estimated fair value of the assets. | ||
Our intangible assets with indefinite lives consist of trademarks obtained through business acquisitions. We do not amortize existing trademarks whose useful lives were determined to be indefinite. We conduct impairment tests for other intangible assets with indefinite lives and goodwill at the beginning of the fourth quarter of each year, or when circumstances arise that indicate a possible impairment might exist. | ||
We evaluate our trademarks with indefinite lives for impairment by comparing their carrying amount to their estimated fair value. The fair value of trademarks is calculated using a “relief from royalty payments” methodology. This approach involves a two-step process. In the first step, we estimate reasonable royalty rates for each trademark. In the second step, we apply these royalty rates to a net sales stream and discount the resulting cash flows to determine fair value. This fair value is then compared with the carrying value of each trademark. If the estimated fair value is less than the carrying amount, we record an impairment charge to reduce the asset to its estimated fair value. The estimates of future cash flows are generally based on past performance of the brands and reflect net sales projections and assumptions for the brands that we use in current operating plans. We also consider assumptions that market participants may use. Such assumptions are subject to change due to changing economic and competitive conditions. | ||
We use a two-step process to evaluate goodwill for impairment. In the first step, we compare the fair value of each reporting unit with the carrying amount of the reporting unit, including goodwill. We estimate the fair value of the reporting unit based on discounted future cash flows. If the estimated fair value of the reporting unit is less than the carrying amount of the reporting unit, we complete a second step to determine the amount of the goodwill impairment that we should record. In the second step, we determine an implied fair value of the reporting unit’s goodwill by allocating the reporting unit’s fair value to all of its assets and liabilities other than goodwill (including any unrecognized intangible assets). We compare the resulting implied fair value of the goodwill to the carrying amount and record an impairment charge for the difference. | ||
The assumptions we use to estimate fair value are based on the past performance of each reporting unit and reflect the projections and assumptions that we use in current operating plans. We also adjust the assumptions, if necessary, to estimates that we believe market participants would use. Such assumptions are subject to change due to changing economic and competitive conditions. | ||
We provide more information on intangible assets in Note 18, Supplemental Balance Sheet Information. | ||
Comprehensive Income | ||
We report comprehensive income (loss) on the Consolidated Statements of Comprehensive Income and accumulated other comprehensive income (loss) on the Consolidated Balance Sheets. Additional information regarding comprehensive income is contained in Note 9, Comprehensive Income. | ||
We translate results of operations for foreign entities using the average exchange rates during the period. For foreign entities, assets and liabilities are translated to U.S. dollars using the exchange rates in effect at the balance sheet date. Resulting translation adjustments are recorded as a component of other comprehensive income (loss), “Foreign Currency Translation Adjustments.” | ||
Changes to the balances of the unrecognized prior service cost and the unrecognized net actuarial loss, net of income taxes, associated with our pension and post-retirement benefit plans are recorded as a component of other comprehensive income (loss), “Pension and Post-retirement Benefit Plans.” Additional information regarding accounting policies associated with benefit plans is contained in Note 14, Pension and Other Post-Retirement Benefit Plans. | ||
Gains and losses on cash flow hedging derivatives, to the extent effective, are included in other comprehensive income (loss), net of related tax effects. Reclassification adjustments reflecting such gains and losses are recorded in income in the same period during which the hedged transactions affect earnings. Additional information with regard to accounting policies associated with derivative instruments is contained in Note 6, Derivative Instruments and Hedging Activities. | ||
Interest Rate Swaps | ||
In order to manage interest rate exposure, from time to time, we enter into interest rate swap agreements. Interest rate swap agreements are designated as cash flow hedging derivatives and the fair value of such agreements is recorded on the Consolidated Balance Sheets as either an asset or a liability. Additional information with regard to accounting policies associated with derivative instruments is contained in Note 6, Derivative Instruments and Hedging Activities. | ||
Foreign Exchange Forward Contracts and Options | ||
We enter into foreign exchange forward contracts and options to hedge transactions denominated in foreign currencies. These transactions are primarily related to firm commitments or forecasted purchases associated with the construction of a manufacturing facility, equipment, certain raw materials and finished goods. We also hedge payment of forecasted intercompany transactions with our subsidiaries outside of the United States. These contracts reduce currency risk from exchange rate movements. | ||
Foreign exchange forward contracts and options are designated as cash flow hedging derivatives and the fair value of such contracts is recorded on the Consolidated Balance Sheets as either an asset or a liability. Additional information with regard to accounting policies for derivative instruments, including foreign exchange forward contracts and options, is contained in Note 6, Derivative Instruments and Hedging Activities. | ||
License Agreements | ||
We own various registered and unregistered trademarks and service marks, and have rights under licenses to use various trademarks that are of material importance to our business. We also grant trademark licenses to third parties to produce and sell pantry items, flavored milks and various other products primarily under the HERSHEY’S and REESE’S brand names. | ||
Research and Development | ||
We expense research and development costs as incurred. Research and development expense was $47.6 million in 2013, $39.0 million in 2012 and $33.2 million in 2011. The increase in research and development expenses in 2013 was primarily related to the Asia Innovation Center which opened in May 2013. Research and development expense is included in selling, marketing and administrative expenses. | ||
Advertising | ||
We expense advertising costs as incurred. Advertising expense, which is included in selling, marketing and administrative expenses, was $582.4 million in 2013, $480.0 million in 2012 and $414.2 million in 2011. Prepaid advertising expense as of December 31, 2013 was $8.4 million and as of December 31, 2012 was $9.5 million. | ||
Computer Software | ||
We capitalize costs associated with software developed or obtained for internal use when both the preliminary project stage is completed and it is probable that computer software being developed will be completed and placed in service. Capitalized costs include only (i) external direct costs of materials and services consumed in developing or obtaining internal-use software, (ii) payroll and other related costs for employees who are directly associated with and who devote time to the internal-use software project and (iii) interest costs incurred, when material, while developing internal-use software. We cease capitalization of such costs no later than the point at which the project is substantially complete and ready for its intended purpose. | ||
The unamortized amount of capitalized software was $56.5 million as of December 31, 2013 and was $50.5 million as of December 31, 2012. We amortize software costs using the straight-line method over the expected life of the software, generally 3 to 5 years. Accumulated amortization of capitalized software was $277.9 million as of December 31, 2013 and $256.1 million as of December 31, 2012. | ||
We review the carrying value of software and development costs for impairment in accordance with our policy pertaining to the impairment of long-lived assets. Generally, we measure impairment under the following circumstances: | ||
l | When internal-use computer software is not expected to provide substantive service potential; | |
l | A significant change occurs in the extent or manner in which the software is used or is expected to be used; | |
l | A significant change is made or will be made to the software program; and | |
l | Costs of developing or modifying internal-use computer software significantly exceed the amount originally expected to develop or modify the software. | |
Recent Accounting Pronouncements | ||
In July 2013, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update No. 2013-11–Income Taxes (Topic 740): Presentation of an Unrecognized Tax Benefit When a Net Operating Loss Carryforward, a Similar Tax Loss, or a Tax Credit Carryforward Exists (a consensus of the FASB Emerging Issues Task Force) (“ASU No. 2013-11”). ASU No. 2013-11 provides guidance on the financial statement presentation of an unrecognized tax benefit when a net operating loss carryforward, a similar tax loss, or a tax credit carryforward exists. ASU No. 2013-11 is effective for fiscal years, and interim periods within those years, beginning after December 15, 2013. The adoption of ASU No. 2013-11 will not have a significant impact on our consolidated financial statements. |
BUSINESS_ACQUISITIONS_AND_DIVE
BUSINESS ACQUISITIONS AND DIVESTITURES | 12 Months Ended | |||||||
Dec. 31, 2013 | ||||||||
Business Combinations [Abstract] | ' | |||||||
Business Acquisitions | ' | |||||||
BUSINESS ACQUISITIONS | ||||||||
Acquisitions of businesses are accounted for as purchases and, accordingly, their results of operations have been included in the consolidated financial statements since the respective dates of the acquisitions. The purchase price for each of the acquisitions is allocated to the assets acquired and liabilities assumed. | ||||||||
In December 2013, we entered into an agreement to acquire all of the outstanding shares of Shanghai Golden Monkey Food Joint Stock Co., Ltd. (“SGM”), a privately held confectionery company based in Shanghai, China. SGM manufactures, markets and distributes Golden Monkey branded products, including candy, chocolates, protein-based products and snack foods, in China. The purchase price of approximately $584 million will be paid in cash of approximately $498 million and the assumption of approximately $86 million of net debt. Eighty percent of the outstanding shares of SGM will be acquired in mid-2014, with the remaining twenty percent of the shares to be acquired one year from that date. The transaction is subject to government and regulatory approvals and customary closing conditions. | ||||||||
In January 2012, we acquired all of the outstanding stock of Brookside Foods Ltd. (“Brookside”), a privately held confectionery company based in Abbottsford, British Columbia, Canada. As part of this transaction, we acquired two production facilities located in British Columbia and Quebec. The Brookside product line is primarily sold in the U.S. and Canada in a take-home re-sealable pack type. | ||||||||
Our financial statements reflect the final accounting for the Brookside acquisition. The purchase price for the acquisition was approximately $172.9 million. The purchase price allocation of the Brookside acquisition is as follows: | ||||||||
In thousands of dollars | Purchase Price | Estimated | ||||||
Allocation | Useful Life | |||||||
in Years | ||||||||
Goodwill | $ | 67,974 | Indefinite | |||||
Trademarks | 60,253 | 25 | ||||||
Other intangibles(1) | 51,057 | 6 | to | 17 | ||||
Other assets, net of liabilities assumed of $18.7 million | 21,673 | |||||||
Non-current deferred tax liabilities | (28,101 | ) | ||||||
Purchase price | $ | 172,856 | ||||||
(1) Includes customer relationships, patents and covenants not to compete. | ||||||||
The excess purchase price over the estimated value of the net tangible and identifiable intangible assets was recorded to goodwill. The goodwill is not expected to be deductible for tax purposes. | ||||||||
We included results of the Brookside business subsequent to the acquisition date in the consolidated financial statements. If we had included the results of the business in the consolidated financial statements for each of the periods presented, the effect would not have been material. |
BUSINESS_REALIGNMENT_AND_IMPAI
BUSINESS REALIGNMENT AND IMPAIRMENT CHARGES | 12 Months Ended | ||||||||||||
Dec. 31, 2013 | |||||||||||||
Business Realignment And Impairment Charges Disclosure [Abstract] | ' | ||||||||||||
Business Realignment and Impairment Charges | ' | ||||||||||||
BUSINESS REALIGNMENT AND IMPAIRMENT CHARGES | |||||||||||||
In June 2010, we announced Project Next Century (the “Next Century program”) as part of our ongoing efforts to create an advantaged supply chain and competitive cost structure. As part of the program, production was transitioned from the Company's century-old facility at 19 East Chocolate Avenue in Hershey, Pennsylvania, to an expanded West Hershey facility, which was built in 1992. Production from the 19 East Chocolate Avenue plant, as well as a portion of the workforce, was fully transitioned to the West Hershey facility during 2012. | |||||||||||||
We estimate that the Next Century program will incur pre-tax charges and non-recurring project implementation costs of $190 million to $200 million. As of December 31, 2013, total costs of $190.4 million have been recorded over the last four years for the Next Century program. Total costs of $16.8 million were recorded during 2013. Total costs of $76.3 million were recorded in 2012, costs of $43.4 million were recorded in 2011 and total costs of $53.9 million were recorded in 2010. | |||||||||||||
During 2009, we completed our comprehensive, three-year supply chain transformation program (the “global supply chain transformation program”). | |||||||||||||
In December 2012, the Company recorded non-cash asset impairment charges of approximately $7.5 million, primarily associated with the write off of goodwill and other intangible assets of Tri-US, Inc., a subsidiary in which we held a controlling interest. | |||||||||||||
Charges (credits) associated with business realignment initiatives and impairment recorded during 2013, 2012 and 2011 were as follows: | |||||||||||||
For the years ended December 31, | 2013 | 2012 | 2011 | ||||||||||
In thousands of dollars | |||||||||||||
Cost of sales | |||||||||||||
Next Century program | $ | 402 | $ | 36,383 | $ | 39,280 | |||||||
Global supply chain transformation program | — | — | 5,816 | ||||||||||
Total cost of sales | 402 | 36,383 | 45,096 | ||||||||||
Selling, marketing and administrative - Next Century program | 18 | 2,446 | 4,961 | ||||||||||
Business realignment and impairment charges, net | |||||||||||||
Next Century program: | |||||||||||||
Pension settlement loss | — | 15,787 | — | ||||||||||
Plant closure expenses | 16,387 | 20,780 | 8,620 | ||||||||||
Employee separation costs (credits) | — | 914 | (9,506 | ) | |||||||||
India voluntary retirement program | 2,278 | — | — | ||||||||||
Tri-US, Inc. asset impairment charges | — | 7,457 | — | ||||||||||
Total business realignment and impairment charges (credits), net | 18,665 | 44,938 | (886 | ) | |||||||||
Total net charges associated with business realignment initiatives and impairment | $ | 19,085 | $ | 83,767 | $ | 49,171 | |||||||
Next Century Program | |||||||||||||
Plant closure expenses of $16.4 million were recorded during 2013, primarily related to costs associated with the demolition of a former manufacturing facility. | |||||||||||||
The charge of $36.4 million recorded in cost of sales during 2012 related primarily to start-up costs and accelerated depreciation of fixed assets over a reduced estimated remaining useful life associated with the Next Century program. A charge of $2.4 million was recorded in selling, marketing and administrative expenses during 2012 for project administration related to the Next Century program. The level of lump sum withdrawals during 2012 from one of the Company's pension plans by employees retiring or leaving the Company, primarily under the Next Century program, resulted in a non-cash pension settlement loss of $15.8 million. Expenses of $20.8 million were recorded in 2012 primarily related to costs associated with the closure of a manufacturing facility and the relocation of production lines. | |||||||||||||
The charge of $39.3 million recorded in cost of sales during 2011 related primarily to accelerated depreciation of fixed assets over a reduced estimated remaining useful life associated with the Next Century program. A charge of $5.0 million was recorded in selling, marketing and administrative expenses during 2011 for project administration related to the Next Century program. Plant closure expenses of $8.6 million were recorded in 2011 primarily related to costs associated with the relocation of production lines. Employee separation costs were reduced by $9.5 million during 2011, which consisted of an $11.2 million credit reflecting lower expected costs related to voluntary and involuntary terminations at the two manufacturing facilities and a net benefits curtailment loss of $1.7 million also related to the employee terminations. | |||||||||||||
Global Supply Chain Transformation Program | |||||||||||||
The charge of $5.8 million recorded in 2011 was due to a decline in the estimated net realizable value of two properties being held for sale. | |||||||||||||
Tri-US, Inc. Impairment Charges | |||||||||||||
In February 2011, we acquired a 49% interest in Tri-US, Inc. of Boulder, Colorado, a company that manufactured, marketed and sold nutritional beverages under the “mix1” brand name. We invested $5.8 million and accounted for this investment using the equity method until January 2012. In January 2012, we made an additional investment of $6.0 million in Tri-US, Inc., resulting in a controlling ownership interest of approximately 69%. In December 2012, the board of directors of Tri-US, Inc. decided to immediately cease operations and dissolve the company as a result of operational difficulties, quality issues and competitive constraints. It was determined that investments necessary to continue the business would not generate a sufficient return. Accordingly, in December 2012, the Company recorded non-cash asset impairment charges of approximately $7.5 million, primarily associated with the write off of goodwill and other intangible assets. These charges excluded the portion of the losses attributable to the noncontrolling interests. | |||||||||||||
Liabilities Associated with Business Realignment Initiatives | |||||||||||||
As of December 31, 2013, there was no remaining liability balance relating to the Next Century program. We made payments against the liabilities recorded for the Next Century program of $7.6 million in 2013 and $12.8 million in 2012 related to employee separation and project administration costs. |
NONCONTROLLING_INTERESTS_IN_SU
NONCONTROLLING INTERESTS IN SUBSIDIARIES Notes | 12 Months Ended |
Dec. 31, 2013 | |
Noncontrolling Interest [Abstract] | ' |
Noncontrolling Interests in Subsidiaries | ' |
NONCONTROLLING INTERESTS IN SUBSIDIARIES | |
In May 2007, we entered into an agreement with Godrej Beverages and Foods, Ltd., a consumer goods, confectionery and food company, to manufacture and distribute confectionery products, snacks and beverages across India. Under the agreement, we owned a 51% controlling interest in Godrej Hershey Ltd. The noncontrolling interests in Godrej Hershey Ltd. were included in the equity section of the Consolidated Balance Sheets. In September 2012, we acquired the remaining 49% interest in Godrej Hershey Ltd. for approximately $15.8 million. Since the Company had a controlling interest in Godrej Hershey Ltd., the difference between the amount paid and the carrying amount of the noncontrolling interest of $10.3 million was recorded as a reduction to additional paid-in capital and the noncontrolling interest in Godrej Hershey Ltd. was eliminated as of September 30, 2012. | |
We own a 51% controlling interest in Hershey do Brasil under a cooperative agreement with Pandurata Netherlands B.V. (“Bauducco”), a leading manufacturer of baked goods in Brazil whose primary brand is Bauducco. In both 2013 and 2012, the Company contributed cash of approximately $3.1 million to Hershey do Brasil and Bauducco contributed approximately $2.9 million. The noncontrolling interest in Hershey do Brasil is included in the equity section of the Consolidated Balance Sheets. | |
The decrease in noncontrolling interests in subsidiaries from $11.6 million as of December 31, 2012 to $11.2 million as of December 31, 2013 reflected the impact of the noncontrolling interests’ share of losses of these entities and currency translation adjustments, partially offset by the impact of the cash contributed by Bauducco. The share of losses pertaining to the noncontrolling interests in subsidiaries was $1.7 million for the year ended December 31, 2013, $9.6 million for the year ended December 31, 2012 and $7.4 million for the year ended December 31, 2011. This was reflected in selling, marketing and administrative expenses. |
COMMITMENTS_AND_CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 12 Months Ended | ||||||||||||||||||
Dec. 31, 2013 | |||||||||||||||||||
Commitments and Contingencies Disclosure [Abstract] | ' | ||||||||||||||||||
Commitments and Contingencies | ' | ||||||||||||||||||
COMMITMENTS AND CONTINGENCIES | |||||||||||||||||||
We enter into certain obligations for the purchase of raw materials. These obligations are primarily in the form of forward contracts for the purchase of raw materials from third-party brokers and dealers. These contracts minimize the effect of future price fluctuations by fixing the price of part or all of these purchase obligations. Total obligations for each year consisted of fixed price contracts for the purchase of commodities and unpriced contracts that were valued using market prices as of December 31, 2013. | |||||||||||||||||||
The cost of commodities associated with the unpriced contracts is variable as market prices change over future periods. We mitigate the variability of these costs to the extent that we have entered into commodities futures contracts or other commodity derivative instruments to hedge our costs for those periods. Increases or decreases in market prices are offset by gains or losses on commodities futures contracts or other commodity derivative instruments. Taking delivery of and making payments for the specific commodities for use in the manufacture of finished goods satisfies our obligations under the forward purchase contracts. For each of the three years in the period ended December 31, 2013, we satisfied these obligations by taking delivery of and making payment for the specific commodities. | |||||||||||||||||||
As of December 31, 2013, we had entered into purchase agreements with various suppliers. Subject to meeting our quality standards, the purchase obligations covered by these agreements were as follows as of December 31, 2013: | |||||||||||||||||||
Purchase Obligations | 2014 | 2015 | 2016 | 2017 | |||||||||||||||
In millions of dollars | |||||||||||||||||||
Purchase obligations | $ | 1,381.60 | $ | 651.9 | $ | 48.3 | $ | 6.4 | |||||||||||
We have commitments under various lease obligations. Future minimum payments under lease obligations with a remaining term in excess of one year were as follows as of December 31, 2013: | |||||||||||||||||||
Lease Obligations | 2014 | 2015 | 2016 | 2017 | 2018 | Thereafter | |||||||||||||
In millions of dollars | |||||||||||||||||||
Future minimum rental payments | $ | 36.7 | $ | 11.5 | $ | 10.8 | $ | 7.6 | $ | 2.2 | $ | 1.6 | |||||||
Future minimum rental payments reflect commitments under non-cancelable operating leases primarily for offices, retail stores, warehouse and distribution facilities, and certain equipment. In September 2013, we entered into an agreement to lease land for the construction of a new confectionery manufacturing plant in Johor, Malaysia. The lease term is 99 years and obligations under the terms of the lease require a payment of approximately $24.0 million in 2014 which is included in future minimum rental payments above. | |||||||||||||||||||
In December 2013, we entered into an agreement for the construction of the new confectionery manufacturing plant in Malaysia. The total cost of construction is expected to be approximately $240 million. The plant is expected to begin operations during the second quarter of 2015. | |||||||||||||||||||
We have a number of facilities that contain varying amounts of asbestos in certain locations within the facilities. Our asbestos management program is compliant with current applicable regulations. Current regulations require that we handle or dispose of asbestos in a special manner if such facilities undergo major renovations or are demolished. Costs associated with the removal of asbestos related to the closure of a manufacturing facility under the Next Century program were recorded primarily in 2012 and included in business realignment and impairment charges. The costs associated with the removal of asbestos from the facility were not material. With regard to other facilities, we believe we do not have sufficient information to estimate the fair value of any asset retirement obligations related to these facilities. We cannot specify the settlement date or range of potential settlement dates and, therefore, sufficient information is not available to apply an expected present value technique. We expect to maintain the facilities with repairs and maintenance activities that would not involve or require the removal of significant quantities of asbestos. | |||||||||||||||||||
In 2007, the Competition Bureau of Canada began an inquiry into alleged violations of the Canadian Competition Act in the sale and supply of chocolate products sold in Canada between 2002 and 2008 by members of the confectionery industry, including Hershey Canada, Inc. The U.S. Department of Justice also notified the Company in 2007 that it had opened an inquiry, but has not requested any information or documents. | |||||||||||||||||||
Subsequently, 13 civil lawsuits were filed in Canada and 91 civil lawsuits were filed in the United States against the Company. The lawsuits were instituted on behalf of direct purchasers of our products as well as indirect purchasers that purchase our products for use or for resale. Several other chocolate and confectionery companies were named as defendants in these lawsuits as they also were the subject of investigations and/or inquiries by the government entities referenced above. The cases seek recovery for losses suffered as a result of alleged conspiracies in restraint of trade in connection with the pricing practices of the defendants. The Canadian civil cases were settled in 2012. Hershey Canada, Inc. reached a settlement agreement with the Competition Bureau of Canada through their Leniency Program with regard to an inquiry into alleged violations of the Canadian Competition Act in the sale and supply of chocolate products sold in Canada by members of the confectionery industry. On June 21, 2013, Hershey Canada, Inc. pleaded guilty to one count of price fixing related to communications with competitors in Canada in 2007 and paid a fine of approximately $4.0 million. Hershey Canada, Inc. had promptly reported the conduct to the Competition Bureau, cooperated fully with its investigation and did not implement the planned price increase that was the subject of the 2007 communications. | |||||||||||||||||||
With regard to the U.S. lawsuits, the Judicial Panel on Multidistrict Litigation assigned the cases to the U.S. District Court for the Middle District of Pennsylvania. Plaintiffs are seeking actual and treble damages against the Company and other defendants based on an alleged overcharge for certain, or in some cases all chocolate products sold in the U.S. between December 2002 and December 2007 and certain plaintiff groups have alleged damages that extend beyond the alleged conspiracy period. The lawsuits have been proceeding on different scheduling tracks for different groups of plaintiffs. | |||||||||||||||||||
Defendants have briefed summary judgment against the direct purchaser plaintiffs that have not sought class certification (the “Opt-Out Plaintiffs”) and those that have (the “Direct Purchaser Class Plaintiffs”). The Direct Purchaser Class Plaintiffs were granted class certification in December 2012. Liability, fact and expert discovery in the Opt-Out Plaintiffs’ and Direct Purchaser Class Plaintiffs’ cases has been completed. The hearing on summary judgment for the Direct Purchaser Class Plaintiffs, combined with the summary judgment hearing for the Opt-Out Plaintiffs, was held on October 7, 2013. A decision is expected in the near term. Putative class plaintiffs that purchased product indirectly for resale (the “Indirect Purchasers for Resale”) have moved for class certification. A briefing schedule has not been finalized. Putative class plaintiffs that purchased product indirectly for use (the “Indirect End Users”) may seek class certification after summary judgment against the Direct Purchaser Class Plaintiffs and the Opt-Out Plaintiffs has been resolved. No trial date has been set for any group of plaintiffs. The Company will continue to vigorously defend against these lawsuits. | |||||||||||||||||||
Competition and antitrust law investigations can be lengthy and violations are subject to civil and/or criminal fines and other sanctions. Class action civil antitrust lawsuits are expensive to defend and could result in significant judgments, including in some cases, payment of treble damages and/or attorneys' fees to the successful plaintiff. Additionally, negative publicity involving these proceedings could affect our Company's brands and reputation, possibly resulting in decreased demand for our products. These possible consequences, in our opinion, are currently not expected to materially impact our financial position or liquidity, but could materially impact our results of operations and cash flows in the period in which any fines, settlements or judgments are accrued or paid, respectively. | |||||||||||||||||||
We have no other material pending legal proceedings, other than ordinary routine litigation incidental to our business. |
DERIVATIVE_INSTRUMENTS_AND_HED
DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES | 12 Months Ended | ||||||||||||
Dec. 31, 2013 | |||||||||||||
Derivative Instruments and Hedging Activities Disclosure [Abstract] | ' | ||||||||||||
Derivative Instruments and Hedging Activities | ' | ||||||||||||
DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES | |||||||||||||
We classify derivatives as assets or liabilities on the balance sheet. Accounting for the change in fair value of the derivative depends on: | |||||||||||||
l | Whether the instrument qualifies for, and has been designated as, a hedging relationship; and | ||||||||||||
l | The type of hedging relationship. | ||||||||||||
There are three types of hedging relationships: | |||||||||||||
l | Cash flow hedge; | ||||||||||||
l | Fair value hedge; and | ||||||||||||
l | Hedge of foreign currency exposure of a net investment in a foreign operation. | ||||||||||||
As of December 31, 2013 and 2012, all of our derivative instruments were classified as cash flow hedges, except for out of the money options contracts on certain commodities. | |||||||||||||
The amount of net gains on derivative instruments, including interest rate swap agreements, foreign exchange forward contracts and options, commodities futures and options contracts, and other commodity derivative instruments expected to be reclassified into earnings in the next 12 months was approximately $22.5 million after tax as of December 31, 2013. This amount was primarily associated with commodities futures contracts. | |||||||||||||
Objectives, Strategies and Accounting Policies Associated with Derivative Instruments | |||||||||||||
We use certain derivative instruments to manage risks. These include interest rate swaps to manage interest rate risk; foreign currency forward exchange contracts and options to manage foreign currency exchange rate risk; and commodities futures and options contracts to manage commodity market price risk exposures. | |||||||||||||
We enter into interest rate swap agreements and foreign exchange forward contracts and options for periods consistent with related underlying exposures. These derivative instruments do not constitute positions independent of those exposures. | |||||||||||||
We enter into commodities futures and options contracts and other derivative instruments for varying periods. These commodity derivative instruments are intended to be, and are effective as hedges of market price risks associated with anticipated raw material purchases, energy requirements and transportation costs. We do not hold or issue derivative instruments for trading purposes and are not a party to any instruments with leverage or prepayment features. | |||||||||||||
In entering into these contracts, we have assumed the risk that might arise from the possible inability of counterparties to meet the terms of their contracts. We mitigate this risk by entering into exchanged-traded contracts with collateral posting requirements and/or by performing financial assessments prior to contract execution, conducting periodic evaluations of counterparty performance and maintaining a diverse portfolio of qualified counterparties. We do not expect any significant losses from counterparty defaults. | |||||||||||||
Interest Rate Swaps | |||||||||||||
In order to manage interest rate exposure, from time to time, we enter into interest rate swap agreements. We include gains and losses on interest rate swap agreements in other comprehensive income. We recognize the gains and losses on interest rate swap agreements as an adjustment to interest expense in the same period as the hedged interest payments affect earnings. We classify cash flows from interest rate swap agreements as net cash provided from operating activities on the Consolidated Statements of Cash Flows. Our risk related to the swap agreements is limited to the cost of replacing the agreements at prevailing market rates. | |||||||||||||
Foreign Exchange Forward Contracts and Options | |||||||||||||
We enter into foreign currency forward exchange contracts and options to hedge transactions primarily related to commitments and forecasted purchases associated with the construction of a manufacturing facility, equipment, raw materials and finished goods denominated in foreign currencies. We may also hedge payment of forecasted intercompany transactions with our subsidiaries outside of the United States. These contracts reduce currency risk from exchange rate movements. We generally hedge foreign currency price risks for periods from 3 to 24 months. | |||||||||||||
Foreign exchange forward contracts and options are effective as hedges of identifiable foreign currency commitments or forecasted transactions. Since there is a direct relationship between the foreign currency derivatives and the foreign currency denomination of the transactions, the derivatives are highly effective in hedging cash flows related to transactions denominated in the corresponding foreign currencies. We designate our foreign exchange forward contracts and options as cash flow hedging derivatives. | |||||||||||||
These contracts meet the criteria for cash flow hedge accounting treatment. We classify the fair value of foreign exchange forward contracts as prepaid expenses and other current assets, other non-current assets, accrued liabilities or other long-term liabilities on the Consolidated Balance Sheets. We report the offset to the foreign exchange forward contracts and options contracts in accumulated other comprehensive loss, net of income taxes. We record gains and losses on these contracts as a component of other comprehensive income and reclassify them into earnings in the same period during which the hedged transactions affect earnings. For hedges associated with the construction of a manufacturing facility and the purchase of equipment, we designate the related cash flows as net cash flows (used by) provided from investing activities on the Consolidated Statements of Cash Flows. We classify cash flows from other foreign exchange forward contracts and options as net cash provided from operating activities. | |||||||||||||
As of December 31, 2013, the fair value of foreign exchange forward contracts and options with gains totaled $3.4 million and the fair value of foreign exchange forward contracts and options with losses totaled $0.2 million. Over the last three years the volume of activity for foreign exchange forward contracts to purchase foreign currencies ranged from a contract amount of $17.1 million to $158.4 million. Over the same period, the volume of activity for foreign exchange forward contracts to sell foreign currencies ranged from a contract amount of $2.8 million to $192.8 million. | |||||||||||||
Commodities Futures and Options Contracts | |||||||||||||
We enter into commodities futures and options contracts and other commodity derivative instruments to reduce the effect of future price fluctuations associated with the purchase of raw materials, energy requirements and transportation services. We generally hedge commodity price risks for 3 to 24 month periods. Commodities futures and options contracts and other commodity derivative instruments are highly effective in hedging price risks for our raw material requirements, energy requirements and transportation costs. Because our commodities futures and in the money options contracts and other commodity derivative instruments meet hedge accounting requirements, we account for them as cash flow hedges. Accordingly, we include gains and losses on hedging instruments in other comprehensive income. We recognize gains and losses in cost of sales in the same period that we record the hedged raw material requirements in cost of sales. The time value for out of the money commodities options contracts is recorded as an asset or liability, with the changes in value recorded currently in income. | |||||||||||||
We use exchange traded futures contracts to hedge price fluctuations of unpriced physical forward purchase contracts, as well as forecasted purchases for which we have not entered into unpriced physical forward purchase contracts. Fixed-price physical forward purchase contracts are accounted for as “normal purchases and sales” contracts and, therefore, are not accounted for as derivative instruments. On a daily basis, we receive or make cash transfers reflecting changes in the value of exchange-traded futures contracts (unrealized gains and losses). As mentioned above, such gains and losses are included as a component of other comprehensive income. The cash transfers offset higher or lower cash requirements for payment of future invoice prices for raw materials, energy requirements and transportation costs. | |||||||||||||
Over the last three years our total annual volume of futures and options traded in conjunction with commodities hedging strategies ranged from approximately 45,000 to 60,000 contracts. We use futures and options contracts and other non-exchange traded commodity derivative instruments in combination with forward purchasing of cocoa products, sugar, corn sweeteners, natural gas and certain dairy products, primarily to reduce the risk of future price increases and provide visibility to future costs. Our commodity procurement practices are intended to reduce the risk of future price increases and provide visibility to future costs, but also may potentially limit our ability to benefit from possible price decreases. | |||||||||||||
Hedge Effectiveness—Commodities | |||||||||||||
We perform an assessment of hedge effectiveness for commodities futures and options contracts and other commodity derivative instruments on a quarterly basis or more frequently as necessary. Because of the rollover strategy used for commodities futures contracts, as required by futures market conditions, some ineffectiveness may result in hedging forecasted manufacturing requirements. This occurs as we switch futures contracts from nearby contract positions to contract positions that are required to fix the price of anticipated manufacturing requirements. Hedge ineffectiveness may also result from variability in basis differentials associated with the purchase of raw materials for manufacturing requirements. We record the ineffective portion of gains or losses on commodities futures and options contracts currently in cost of sales. | |||||||||||||
The prices of commodities futures contracts reflect delivery to the same locations where we take delivery of the physical commodities. Therefore, there is no ineffectiveness resulting from differences in location between the derivative and the hedged item. | |||||||||||||
Financial Statement Location and Amounts Pertaining to Derivative Instruments | |||||||||||||
The fair value of derivative instruments in the Consolidated Balance Sheet as of December 31, 2013 was as follows: | |||||||||||||
Balance Sheet Caption | Interest Rate Swap | Foreign | Commodities Futures and Options Contracts | ||||||||||
Agreements | Exchange | ||||||||||||
Forward | |||||||||||||
Contracts | |||||||||||||
and Options | |||||||||||||
In thousands of dollars | |||||||||||||
Prepaid expense and other current assets | $ | — | $ | 2,672 | $ | 4,306 | |||||||
Other assets | $ | 22,745 | $ | 751 | $ | — | |||||||
Accrued liabilities | $ | — | $ | — | $ | 129 | |||||||
Other long-term liabilities | $ | — | $ | 198 | $ | — | |||||||
The fair value of derivative instruments in the Consolidated Balance Sheet as of December 31, 2012 was as follows: | |||||||||||||
Balance Sheet Caption | Interest Rate Swap | Foreign | Commodities Futures and Options Contracts | ||||||||||
Agreements | Exchange | ||||||||||||
Forward | |||||||||||||
Contracts | |||||||||||||
and Options | |||||||||||||
In thousands of dollars | |||||||||||||
Prepaid expense and other current assets | $ | — | $ | 2,119 | $ | — | |||||||
Accrued liabilities | $ | 12,502 | $ | 917 | $ | 2,010 | |||||||
Other long-term liabilities | $ | 922 | $ | — | $ | — | |||||||
The fair value of the interest rate swap agreements represents the difference in the present values of cash flows calculated at the contracted interest rates and at current market interest rates at the end of the period. We calculate the fair value of interest rate swap agreements quarterly based on inputs derived from observable market data. | |||||||||||||
The fair value of foreign exchange forward contracts and options is the amount of the difference between the contracted and current market foreign currency exchange rates at the end of the period. We estimate the fair value of foreign exchange forward contracts and options on a quarterly basis by obtaining market quotes of spot and forward rates for contracts with similar terms, adjusted where necessary for maturity differences. | |||||||||||||
As of December 31, 2013, prepaid expense and other current assets associated with commodities futures and options contracts reflected the fair value of options contracts for certain commodities. As of December 31, 2013 and 2012, accrued liabilities associated with commodities futures and options contracts were primarily related to net cash transfers payable on commodities futures contracts reflecting the change in quoted market prices on the last trading day for the period. We make or receive cash transfers to or from commodity futures brokers on a daily basis reflecting changes in the market value of futures contracts on the IntercontinentalExchange or various other exchanges. | |||||||||||||
The effect of derivative instruments on the Consolidated Statements of Income for the year ended December 31, 2013 was as follows: | |||||||||||||
Cash Flow Hedging Derivatives | Interest Rate | Foreign Exchange | Commodities | ||||||||||
Swap | Forward | Futures and | |||||||||||
Agreements | Contracts | Options | |||||||||||
and Options | Contracts | ||||||||||||
In thousands of dollars | |||||||||||||
Gains (losses) recognized in other comprehensive income (“OCI”) (effective portion) | $ | 27,534 | $ | 4,049 | $ | 84,746 | |||||||
Gains (losses) reclassified from accumulated OCI into income (effective portion) (a) | $ | (3,606 | ) | $ | 2,641 | $ | (8,400 | ) | |||||
Gains recognized in income (ineffective portion) (b) | $ | — | $ | — | $ | 3,241 | |||||||
The effect of derivative instruments on the Consolidated Statements of Income for the year ended December 31, 2012 was as follows: | |||||||||||||
Cash Flow Hedging Derivatives | Interest Rate | Foreign Exchange | Commodities | ||||||||||
Swap | Forward | Futures and | |||||||||||
Agreements | Contracts | Options | |||||||||||
and Options | Contracts | ||||||||||||
In thousands of dollars | |||||||||||||
Gains (losses) recognized in other comprehensive income (“OCI”) (effective portion) | $ | (13,424 | ) | $ | 47 | $ | 12,834 | ||||||
Gains (losses) reclassified from accumulated OCI into income (effective portion) (a) | $ | (3,605 | ) | $ | (2,488 | ) | $ | (90,900 | ) | ||||
Gains recognized in income (ineffective portion) (b) | $ | — | $ | — | $ | 670 | |||||||
(a) | Gains (losses) reclassified from accumulated OCI into income were included in cost of sales for commodities futures and options contracts and other commodity derivative instruments and for foreign exchange forward contracts and options designated as hedges of purchases of inventory. Other gains and losses for foreign exchange forward contracts and options were included in selling, marketing and administrative expenses. Other gains and losses for interest rate swap agreements were included in interest expense. | ||||||||||||
(b) | Gains recognized in income were included in cost of sales for commodities futures and options contracts. | ||||||||||||
Gains recognized currently in income were related to the ineffective portion of the hedging relationship. We recognized no components of gains and losses on cash flow hedging derivatives in income due to excluding such components from the hedge effectiveness assessment. |
FINANCIAL_INSTRUMENTS
FINANCIAL INSTRUMENTS | 12 Months Ended | ||||||||||||
Dec. 31, 2013 | |||||||||||||
Financial Instruments Disclosure [Abstract] | ' | ||||||||||||
FINANCIAL INSTRUMENTS | ' | ||||||||||||
FINANCIAL INSTRUMENTS | |||||||||||||
The carrying amounts of financial instruments including cash and cash equivalents, accounts receivable, accounts payable and short-term debt approximated fair value as of December 31, 2013 and December 31, 2012, because of the relatively short maturity of these instruments. | |||||||||||||
The carrying value of long-term debt, including the current portion, was $1,796.1 million as of December 31, 2013, compared with a fair value of $1,947.0 million based on quoted market prices for the same or similar debt issues. The carrying value of long-term debt, including the current portion, was $1,788.7 million as of December 31, 2012 compared with a fair value of $2,060.8 million. | |||||||||||||
Interest Rate Swaps | |||||||||||||
In order to manage interest rate exposure, the Company, from time to time, enters into interest rate swap agreements. In April 2012, the Company entered into forward starting interest rate swap agreements to hedge interest rate exposure related to the anticipated $250 million of term financing expected to be executed during 2013 to repay $250 million of 5.0% Notes maturing in April 2013. The weighted-average fixed rate on these forward starting swap agreements was 2.4%. In May 2012, the Company entered into forward starting interest rate swap agreements to hedge interest rate exposure related to the anticipated $250 million of term financing expected to be executed during 2015 to repay $250 million of 4.85% Notes maturing in August 2015. The weighted-average fixed rate on these forward starting swap agreements is 2.7%. | |||||||||||||
The forward starting swap agreements entered into in April 2012 matured in March 2013, resulting in a realized loss of approximately $9.5 million. Also in March 2013, we entered into forward starting swap agreements to continue to hedge interest rate exposure related to the term financing expected to be executed in 2013. The weighted-average fixed rate on the forward starting swap agreements was 2.1%. | |||||||||||||
In May 2013, we terminated the forward starting swap agreements which were entered into in March 2013 to hedge the anticipated execution of term financing. The swap agreements were terminated upon the issuance of the 2.625% Notes due May 1, 2023, resulting in cash payments of $0.2 million in May 2013. Losses on these swap agreements are included in accumulated other comprehensive loss and are being amortized as an increase to interest expense over the term of the Notes. | |||||||||||||
The fair value of interest rate swap agreements was an asset of $22.7 million as of December 31, 2013. The Company's risk related to interest rate swap agreements is limited to the cost of replacing such agreements at prevailing market rates. | |||||||||||||
In March 2009, we entered into forward starting interest rate swap agreements to hedge interest rate exposure related to the anticipated $250 million of term financing expected to be executed during 2011. In September 2011, the forward starting interest rate swap agreements which were entered into in March 2009 matured, resulting in cash payments by the Company of approximately $26.8 million. Also in September 2011, we entered into forward starting swap agreements to continue to hedge interest rate exposure related to the term financing. These swap agreements were terminated upon the issuance of the 1.5% Notes due November 1, 2016, resulting in cash payments by the Company of $2.3 million in November 2011. The losses on the swap agreements are being amortized as an increase to interest expense over the term of the Notes. | |||||||||||||
For more information see Note 6, Derivative Instruments and Hedging Activities. | |||||||||||||
Foreign Exchange Forward Contracts | |||||||||||||
For information on the objectives, strategies and accounting polices related to our use of foreign exchange forward contracts, see Note 6, Derivative Instruments and Hedging Activities. | |||||||||||||
A summary of foreign exchange forward contracts and the corresponding amounts at contracted forward rates is as follows: | |||||||||||||
December 31, | 2013 | 2012 | |||||||||||
Contract | Primary | Contract | Primary | ||||||||||
Amount | Currencies | Amount | Currencies | ||||||||||
In millions of dollars | |||||||||||||
Foreign exchange forward contracts to purchase foreign currencies | $ | 158.4 | Malaysian ringgits | $ | 17.1 | Euros | |||||||
Swiss francs | British pound sterling | ||||||||||||
Euros | |||||||||||||
Foreign exchange forward contracts to sell foreign currencies | $ | 2.8 | Japanese Yen | $ | 57.8 | Canadian dollars | |||||||
Foreign exchange forward contracts for the purchase of Malaysian ringgits and certain other currencies are associated with the construction of the manufacturing facility in Malaysia. | |||||||||||||
The fair value of foreign exchange forward contracts is included in prepaid expenses and other current assets, other non-current assets, accrued liabilities or other long-term liabilities, as appropriate. | |||||||||||||
The combined fair value of our foreign exchange forward contracts included in prepaid expenses and other current assets, other non-current assets, accrued liabilities or other long-term liabilities on the Consolidated Balance Sheets was as follows: | |||||||||||||
December 31, | 2013 | 2012 | |||||||||||
In millions of dollars | |||||||||||||
Fair value of foreign exchange forward contracts, net — asset | $ | 3.2 | $ | 1.2 | |||||||||
FAIR_VALUE_ACCOUNTING
FAIR VALUE ACCOUNTING | 12 Months Ended | ||||||||||||||||
Dec. 31, 2013 | |||||||||||||||||
Fair Value Disclosures [Abstract] | ' | ||||||||||||||||
FAIR VALUE ACCOUNTING | ' | ||||||||||||||||
FAIR VALUE ACCOUNTING | |||||||||||||||||
We follow a fair value measurement hierarchy to price certain assets or liabilities. The fair value is determined based on inputs or assumptions that market participants would use in pricing the asset or liability. These assumptions consist of (1) observable inputs - market data obtained from independent sources, or (2) unobservable inputs - market data determined using the Company’s own assumptions about valuation. | |||||||||||||||||
We prioritize the inputs to valuation techniques, with the highest priority being given to Level 1 inputs and the lowest priority to Level 3 inputs, as defined below: | |||||||||||||||||
l | Level 1 Inputs – quoted prices in active markets for identical assets or liabilities; | ||||||||||||||||
l | Level 2 Inputs – quoted prices for similar assets or liabilities in active markets; quoted prices for identical or similar instruments in markets that are not active; inputs other than quoted prices that are observable; and inputs that are derived from or corroborated by observable market data by correlation; and | ||||||||||||||||
l | Level 3 Inputs – unobservable inputs used to the extent that observable inputs are not available. These reflect the entity’s own assumptions about the assumptions that market participants would use in pricing the asset or liability. | ||||||||||||||||
We use certain derivative instruments to manage interest rate, foreign currency exchange rate and commodity market price risk exposures, all of which are recorded at fair value based on quoted market prices or rates. | |||||||||||||||||
A summary of our derivative assets and liabilities measured at fair value on a recurring basis as of December 31, 2013, is as follows: | |||||||||||||||||
Description | Fair Value as of December 31, 2013 | Quoted Prices in | Significant | Significant Unobservable Inputs | |||||||||||||
Active Markets | Other | (Level 3) | |||||||||||||||
of Identical | Observable | ||||||||||||||||
Assets (Level 1) | Inputs (Level 2) | ||||||||||||||||
In thousands of dollars | |||||||||||||||||
Derivative assets | $ | 54,254 | $ | 28,086 | $ | 26,168 | $ | — | |||||||||
Derivative liabilities | $ | 24,107 | $ | 23,909 | $ | 198 | $ | — | |||||||||
As of December 31, 2013, Level 1 derivative assets were related to the fair value of options contracts for certain commodities and cash transfers receivable on commodities futures contracts with gains resulting from the change in quoted market prices on the last trading day for the period. As of December 31, 2013, Level 1 derivative liabilities were related to cash transfers payable on commodities futures contracts with losses resulting from the change in quoted market prices on the last trading day for the period. | |||||||||||||||||
As of December 31, 2013, Level 2 derivative assets were related to the fair value of interest rate swap agreements and foreign exchange forward contracts and options with gains. Level 2 derivative liabilities were related to the fair value of foreign exchange forward contracts and options with losses. The fair value of the interest rate swap agreements represents the difference in the present values of cash flows calculated at the contracted interest rates and at current market interest rates at the end of the period. We calculate the fair value of interest rate swap agreements quarterly based on inputs derived from observable market data. The fair value of foreign exchange forward contracts and options is the amount of the difference between the contracted and current market foreign currency exchange rates at the end of the period. We estimate the fair value of foreign exchange forward contracts and options on a quarterly basis by obtaining market quotes of spot and forward rates for contracts with similar terms, adjusted where necessary for maturity differences. | |||||||||||||||||
A summary of our derivative assets and liabilities measured at fair value on a recurring basis as of December 31, 2012, is as follows: | |||||||||||||||||
Description | Fair Value as of December 31, 2012 | Quoted Prices in | Significant | Significant Unobservable Inputs | |||||||||||||
Active Markets | Other | (Level 3) | |||||||||||||||
of Identical | Observable | ||||||||||||||||
Assets (Level 1) | Inputs (Level 2) | ||||||||||||||||
In thousands of dollars | |||||||||||||||||
Derivative assets | $ | 39,175 | $ | 37,056 | $ | 2,119 | $ | — | |||||||||
Derivative liabilities | $ | 53,407 | $ | 39,066 | $ | 14,341 | $ | — | |||||||||
As of December 31, 2012, Level 1 derivative assets were related to cash transfers receivable on commodities futures contracts with gains resulting from the change in quoted market prices on the last trading day for the period. As of December 31, 2012, Level 1 derivative liabilities were related to cash transfers payable on commodities futures contracts with losses resulting from the change in quoted market prices on the last trading day for the period. | |||||||||||||||||
As of December 31, 2012, Level 2 derivative assets were related to the fair value of foreign exchange forward contracts and options with gains. Level 2 derivative liabilities were related to the fair value of interest rate swap agreements and foreign exchange forward contracts and options with losses. |
COMPREHENSIVE_INCOME
COMPREHENSIVE INCOME | 12 Months Ended | ||||||||||||
Dec. 31, 2013 | |||||||||||||
Comprehensive Income Disclosure [Abstract] | ' | ||||||||||||
Comprehensive Income | ' | ||||||||||||
COMPREHENSIVE INCOME | |||||||||||||
A summary of the components of comprehensive income is as follows: | |||||||||||||
For the year ended December 31, 2013 | Pre-Tax | Tax | After-Tax | ||||||||||
Amount | (Expense) | Amount | |||||||||||
Benefit | |||||||||||||
In thousands of dollars | |||||||||||||
Net income | $ | 820,470 | |||||||||||
Other comprehensive income (loss): | |||||||||||||
Foreign currency translation adjustments | $ | (26,003 | ) | $ | — | (26,003 | ) | ||||||
Pension and post-retirement benefit plans | 265,015 | (98,612 | ) | 166,403 | |||||||||
Cash flow hedges: | |||||||||||||
Gains on cash flow hedging derivatives | 116,329 | (43,995 | ) | 72,334 | |||||||||
Reclassification adjustments | 9,365 | (3,590 | ) | 5,775 | |||||||||
Total other comprehensive income | $ | 364,706 | $ | (146,197 | ) | 218,509 | |||||||
Comprehensive income | $ | 1,038,979 | |||||||||||
For the year ended December 31, 2012 | Pre-Tax | Tax | After-Tax | ||||||||||
Amount | (Expense) | Amount | |||||||||||
Benefit | |||||||||||||
In thousands of dollars | |||||||||||||
Net income | $ | 660,931 | |||||||||||
Other comprehensive income (loss): | |||||||||||||
Foreign currency translation adjustments | $ | 7,714 | $ | — | 7,714 | ||||||||
Pension and post-retirement benefit plans | (15,159 | ) | 5,525 | (9,634 | ) | ||||||||
Cash flow hedges: | |||||||||||||
Losses on cash flow hedging derivatives | (543 | ) | (325 | ) | (868 | ) | |||||||
Reclassification adjustments | 96,993 | (36,950 | ) | 60,043 | |||||||||
Total other comprehensive income | $ | 89,005 | $ | (31,750 | ) | 57,255 | |||||||
Comprehensive income | $ | 718,186 | |||||||||||
For the year ended December 31, 2011 | Pre-Tax | Tax | After-Tax | ||||||||||
Amount | (Expense) | Amount | |||||||||||
Benefit | |||||||||||||
In thousands of dollars | |||||||||||||
Net income | $ | 628,962 | |||||||||||
Other comprehensive income (loss): | |||||||||||||
Foreign currency translation adjustments | $ | (21,213 | ) | $ | — | (21,213 | ) | ||||||
Pension and post-retirement benefit plans | (137,918 | ) | 52,095 | (85,823 | ) | ||||||||
Cash flow hedges: | |||||||||||||
Losses on cash flow hedging derivatives | (175,011 | ) | 67,298 | (107,713 | ) | ||||||||
Reclassification adjustments | (20,282 | ) | 7,767 | (12,515 | ) | ||||||||
Total other comprehensive loss | $ | (354,424 | ) | $ | 127,160 | (227,264 | ) | ||||||
Comprehensive income | $ | 401,698 | |||||||||||
The components of accumulated other comprehensive loss, as shown on the Consolidated Balance Sheets, are as follows: | |||||||||||||
December 31, | 2013 | 2012 | |||||||||||
In thousands of dollars | |||||||||||||
Foreign currency translation adjustments | $ | (16,830 | ) | $ | 9,173 | ||||||||
Pension and post-retirement benefit plans, net of tax | (199,634 | ) | (366,037 | ) | |||||||||
Cash flow hedges, net of tax | 49,897 | (28,212 | ) | ||||||||||
Total accumulated other comprehensive loss | $ | (166,567 | ) | $ | (385,076 | ) |
INTEREST_EXPENSE
INTEREST EXPENSE | 12 Months Ended | ||||||||||||
Dec. 31, 2013 | |||||||||||||
Interest Expense [Abstract] | ' | ||||||||||||
INTEREST EXPENSE | ' | ||||||||||||
INTEREST EXPENSE | |||||||||||||
Net interest expense consisted of the following: | |||||||||||||
For the years ended December 31, | 2013 | 2012 | 2011 | ||||||||||
In thousands of dollars | |||||||||||||
Long-term debt and lease obligations | $ | 84,604 | $ | 81,203 | $ | 85,543 | |||||||
Short-term debt | 8,654 | 23,084 | 17,051 | ||||||||||
Capitalized interest | (1,744 | ) | (5,778 | ) | (7,814 | ) | |||||||
Interest expense, gross | 91,514 | 98,509 | 94,780 | ||||||||||
Interest income | (3,158 | ) | (2,940 | ) | (2,597 | ) | |||||||
Interest expense, net | $ | 88,356 | $ | 95,569 | $ | 92,183 | |||||||
SHORTTERM_DEBT
SHORT-TERM DEBT | 12 Months Ended |
Dec. 31, 2013 | |
Debt Disclosure [Abstract] | ' |
SHORT-TERM DEBT | ' |
SHORT-TERM DEBT | |
As a source of short-term financing, we utilize cash on hand and commercial paper or bank loans with an original maturity of 3 months or less. In October 2011, we entered into a new five-year agreement establishing an unsecured revolving credit facility to borrow up to $1.1 billion, with an option to increase borrowings by an additional $400 million with the consent of the lenders. In November 2013, the five-year agreement entered into in October 2011 was amended. The amendment reduced the amount of borrowings available under the unsecured revolving credit facility to $1.0 billion, with an option to increase borrowings by an additional $400 million with the consent of the lenders, and extended the termination date to November 2018. As of December 31, 2013, $1.0 billion was available to borrow under the agreement and no borrowings were outstanding. | |
The unsecured committed revolving credit agreement contains a financial covenant whereby the ratio of (a) pre-tax income from operations from the most recent four fiscal quarters to (b) consolidated interest expense for the most recent four fiscal quarters may not be less than 2.0 to 1.0 at the end of each fiscal quarter. The credit agreement contains customary representations and warranties and events of default. Payment of outstanding advances may be accelerated, at the option of the lenders, should we default in our obligation under the credit agreement. As of December 31, 2013, we complied with all customary affirmative and negative covenants and the financial covenant pertaining to our credit agreement. There were no significant compensating balance agreements that legally restricted these funds. | |
In addition to the revolving credit facility, we maintain lines of credit with domestic and international commercial banks. Our credit limit in various currencies was $290.3 million in 2013 and $176.7 million in 2012. These lines permit us to borrow at the banks’ prime commercial interest rates, or lower. We had short-term foreign bank loans against these lines of credit for $166.0 million in 2013 and $118.2 million in 2012. | |
The maximum amount of our short-term borrowings during 2013 was $166.0 million. The weighted-average interest rate on short-term borrowings outstanding was 1.9% as of December 31, 2013 and 3.5% as of December 31, 2012. | |
We pay commitment fees to maintain our lines of credit. The average fee during 2013 was less than 0.1% per annum of the commitment. | |
We maintain a consolidated cash management system that includes overdraft positions in certain accounts at several banks. We have the contractual right of offset for the accounts with overdrafts. These offsets reduced cash and cash equivalents by $3.7 million as of December 31, 2013 and $2.8 million as of December 31, 2012. |
LONGTERM_DEBT
LONG-TERM DEBT | 12 Months Ended | ||||||||
Dec. 31, 2013 | |||||||||
Debt Disclosure [Abstract] | ' | ||||||||
LONG-TERM DEBT | ' | ||||||||
LONG-TERM DEBT | |||||||||
Long-term debt consisted of the following: | |||||||||
December 31, | 2013 | 2012 | |||||||
In thousands of dollars | |||||||||
5.00% Notes due 2013 | $ | — | $ | 250,000 | |||||
4.85% Notes due 2015 | 250,000 | 250,000 | |||||||
5.45% Notes due 2016 | 250,000 | 250,000 | |||||||
1.50% Notes due 2016 | 250,000 | 250,000 | |||||||
4.125% Notes due 2020 | 350,000 | 350,000 | |||||||
8.8% Debentures due 2021 | 100,000 | 100,000 | |||||||
2.625% Notes due 2023 | 250,000 | — | |||||||
7.2% Debentures due 2027 | 250,000 | 250,000 | |||||||
Other obligations, net of unamortized debt discount | 96,056 | 88,701 | |||||||
Total long-term debt | 1,796,056 | 1,788,701 | |||||||
Less—current portion | 914 | 257,734 | |||||||
Long-term portion | $ | 1,795,142 | $ | 1,530,967 | |||||
In April 2013, we repaid $250.0 million of 5.0% Notes due in 2013. In May 2013, we issued $250.0 million of 2.625% Notes due in 2023. The Notes were issued under a shelf registration statement on Form S-3 filed in May 2012 that registered an indeterminate amount of debt securities. | |||||||||
The increase in other obligations was primarily associated with the financing obligation under the agreement with the Ferrero Group for the construction of a warehouse and distribution facility. The initial term of the agreement is 10 years, with three renewal periods, each with a term of 10 years. | |||||||||
Aggregate annual maturities during the next five years are as follows: | |||||||||
l | 2014 | — | $0.9 million | ||||||
l | 2015 | — | $251.4 million | ||||||
l | 2016 | — | $501.3 million | ||||||
l | 2017 | — | $0.9 million | ||||||
l | 2018 | — | $0.4 million | ||||||
Our debt is principally unsecured and of equal priority. None of our debt is convertible into our Common Stock. |
INCOME_TAXES
INCOME TAXES | 12 Months Ended | ||||||||||||
Dec. 31, 2013 | |||||||||||||
Income Tax Disclosure [Abstract] | ' | ||||||||||||
INCOME TAXES | ' | ||||||||||||
INCOME TAXES | |||||||||||||
Our income (loss) before income taxes was as follows: | |||||||||||||
For the years ended December 31, | 2013 | 2012 | 2011 | ||||||||||
In thousands of dollars | |||||||||||||
Domestic | $ | 1,252,208 | $ | 980,176 | $ | 904,418 | |||||||
Foreign | (889 | ) | 35,403 | 58,427 | |||||||||
Income before income taxes | $ | 1,251,319 | $ | 1,015,579 | $ | 962,845 | |||||||
The foreign loss before income taxes for 2013 primarily reflected increased investments in advertising and other marketing programs, knowledge-based consumer insights, brand building and route-to-market capabilities. The foreign income before income taxes in 2011 included a $17.0 million gain on the sale of non-core trademark licensing rights. | |||||||||||||
Our provision for income taxes was as follows: | |||||||||||||
For the years ended December 31, | 2013 | 2012 | 2011 | ||||||||||
In thousands of dollars | |||||||||||||
Current: | |||||||||||||
Federal | $ | 372,649 | $ | 299,122 | $ | 254,732 | |||||||
State | 47,980 | 36,187 | 32,174 | ||||||||||
Foreign | 2,763 | 5,554 | 13,366 | ||||||||||
Current provision for income taxes | 423,392 | 340,863 | 300,272 | ||||||||||
Deferred: | |||||||||||||
Federal | 11,334 | 5,174 | 37,160 | ||||||||||
State | 2,212 | 1,897 | (1,005 | ) | |||||||||
Foreign | (6,089 | ) | 6,714 | (2,544 | ) | ||||||||
Deferred income tax provision | 7,457 | 13,785 | 33,611 | ||||||||||
Total provision for income taxes | $ | 430,849 | $ | 354,648 | $ | 333,883 | |||||||
The increase in the federal deferred tax provision in 2013 was primarily due to higher deferred tax liabilities associated with inventories in 2013 compared with 2012. The foreign deferred tax benefit in 2013 principally reflected higher deferred tax assets related to advertising and promotion reserves. The deferred income tax provision in 2012 and 2011 primarily reflected the tax effect of bonus depreciation, although to a lesser extent in 2012, partially reduced by the tax effect of charges for the Next Century program. | |||||||||||||
The income tax benefit associated with stock-based compensation of $48.8 million and $30.2 million for the years ended December 31, 2013 and 2012, respectively, reduced accrued income taxes on the Consolidated Balance Sheets. We credited additional paid-in capital to reflect these excess income tax benefits. | |||||||||||||
Deferred taxes reflect temporary differences between the tax basis and financial statement carrying value of assets and liabilities. The significant temporary differences that comprised the deferred tax assets and liabilities were as follows: | |||||||||||||
December 31, | 2013 | 2012 | |||||||||||
In thousands of dollars | |||||||||||||
Deferred tax assets: | |||||||||||||
Post-retirement benefit obligations | $ | 101,674 | $ | 119,140 | |||||||||
Accrued expenses and other reserves | 119,387 | 112,760 | |||||||||||
Stock-based compensation | 47,324 | 51,388 | |||||||||||
Derivative instruments | — | 23,822 | |||||||||||
Pension | — | 72,374 | |||||||||||
Lease financing obligation | 19,065 | 19,035 | |||||||||||
Accrued trade promotion reserves | 39,234 | 30,594 | |||||||||||
Net operating loss carryforwards | 39,606 | 48,455 | |||||||||||
Other | 11,754 | 3,643 | |||||||||||
Gross deferred tax assets | 378,044 | 481,211 | |||||||||||
Valuation allowance | (87,159 | ) | (74,021 | ) | |||||||||
Total deferred tax assets | 290,885 | 407,190 | |||||||||||
Deferred tax liabilities: | |||||||||||||
Property, plant and equipment, net | 201,224 | 210,406 | |||||||||||
Acquired intangibles | 64,249 | 63,585 | |||||||||||
Inventories | 33,885 | 23,335 | |||||||||||
Derivative instruments | 33,779 | — | |||||||||||
Pension | 8,037 | — | |||||||||||
Other | 1,404 | 10,849 | |||||||||||
Total deferred tax liabilities | 342,578 | 308,175 | |||||||||||
Net deferred tax (liabilities) assets | $ | (51,693 | ) | $ | 99,015 | ||||||||
Included in: | |||||||||||||
Current deferred tax assets, net | $ | 52,511 | $ | 122,224 | |||||||||
Non-current deferred tax assets, net | — | 12,448 | |||||||||||
Non-current deferred tax liabilities, net | (104,204 | ) | (35,657 | ) | |||||||||
Net deferred tax (liabilities) assets | $ | (51,693 | ) | $ | 99,015 | ||||||||
We believe that it is more likely than not that the results of future operations will generate sufficient taxable income to realize the deferred tax assets. Changes in deferred tax assets and deferred tax liabilities for derivative instruments reflected the tax impact on net gains as of December 31, 2013 and on net losses as of December 31, 2012. Changes in deferred tax assets and deferred tax liabilities for pension resulted from the tax impact of the improved funded status of our pension plans as of December 31, 2013 compared with December 31, 2012. The valuation allowances as of December 31, 2013 and 2012 were primarily related to temporary differences principally associated with advertising and promotions, along with tax loss carryforwards from operations in various foreign tax jurisdictions. Additional information on income tax benefits and expenses related to components of accumulated other comprehensive loss is provided in Note 9, Comprehensive Income. | |||||||||||||
The following table reconciles the federal statutory income tax rate with our effective income tax rate: | |||||||||||||
For the years ended December 31, | 2013 | 2012 | 2011 | ||||||||||
Federal statutory income tax rate | 35 | % | 35 | % | 35 | % | |||||||
Increase (reduction) resulting from: | |||||||||||||
State income taxes, net of Federal income tax benefits | 2.8 | 3.2 | 2.4 | ||||||||||
Qualified production income deduction | (2.6 | ) | (2.5 | ) | (2.2 | ) | |||||||
Business realignment and impairment charges and gain on sale of trademark licensing rights | 0.1 | 0.2 | (0.1 | ) | |||||||||
International operations | (0.4 | ) | (0.1 | ) | (0.6 | ) | |||||||
Other, net | (0.5 | ) | (0.9 | ) | 0.2 | ||||||||
Effective income tax rate | 34.4 | % | 34.9 | % | 34.7 | % | |||||||
The decrease in the effective income tax rate in 2013 from state income taxes reflected the comparison to the rate in 2012 which was higher as a result of the impact of certain state tax legislation. The reduction in the effective income tax rate from international operations resulted from an increase in deductions associated with certain foreign tax jurisdictions. These decreases were partially offset by other changes which reduced the effective income tax rate to a greater extent in 2012 as a result of tax benefits resulting from the completion of tax audits. | |||||||||||||
A reconciliation of the beginning and ending amount of unrecognized tax benefits is as follows: | |||||||||||||
December 31, | 2013 | 2012 | |||||||||||
In thousands of dollars | |||||||||||||
Balance at beginning of year | $ | 51,520 | $ | 53,553 | |||||||||
Additions for tax positions taken during prior years | 58,246 | 11,335 | |||||||||||
Reductions for tax positions taken during prior years | (5,776 | ) | (5,478 | ) | |||||||||
Additions for tax positions taken during the current year | 5,523 | 5,750 | |||||||||||
Settlements | — | (5,234 | ) | ||||||||||
Expiration of statutes of limitations | (5,550 | ) | (8,406 | ) | |||||||||
Balance at end of year | $ | 103,963 | $ | 51,520 | |||||||||
The total amount of unrecognized tax benefits that, if recognized, would affect the effective tax rate was $31.7 million as of December 31, 2013 and $30.8 million as of December 31, 2012. | |||||||||||||
We report accrued interest and penalties related to unrecognized tax benefits in income tax expense. We recognized a tax expense of $15.4 million in 2013, and a tax benefit of $5.3 million in 2012 and $0.3 million in 2011 for interest and penalties. Accrued interest and penalties were $23.7 million as of December 31, 2013, and $8.4 million as of December 31, 2012. | |||||||||||||
We file income tax returns in the U.S. federal jurisdiction and various state and foreign jurisdictions. A number of years may elapse before an uncertain tax position, for which we have unrecognized tax benefits, is audited and finally resolved. While it is often difficult to predict the final outcome or the timing of resolution of any particular uncertain tax position, we believe that our unrecognized tax benefits reflect the most likely outcome. We adjust 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 our effective income tax rate in the period of resolution. | |||||||||||||
The number of years with open tax audits varies depending on the tax jurisdiction. Our major taxing jurisdictions include the United States (federal and state), Canada and Mexico. U.S., Canadian and Mexican federal audit issues typically involve the timing of deductions and transfer pricing adjustments. During the first quarter of 2013, the U.S. Internal Revenue Service (“IRS”) commenced its audit of our U.S. income tax returns for 2009 through 2011, and we expect the audit to conclude in 2014. Tax examinations by various state taxing authorities could be conducted for years beginning in 2010. We are no longer subject to Canadian federal income tax examinations by the Canada Revenue Agency (“CRA”) for years before 2007. During the third quarter of 2013, the CRA notified us that it will be conducting an audit of our Canadian income tax returns for 2010 through 2012, and we expect the audit to commence in the first quarter of 2014. During the fourth quarter of 2013, the CRA concluded its audit for 2007 through 2009 and issued a letter to us indicating proposed adjustments primarily associated with business realignment charges and transfer pricing. As of December 31, 2013, we recorded accrued income taxes of approximately $70.6 million related to the proposed adjustments. We provided notice to the U.S. Competent Authority and the CRA provided notice to the Canada Competent Authority of the likely need for their assistance to resolve the proposed adjustments. Accordingly, as of December 31, 2013, we recorded a non-current receivable of approximately $63.9 million associated with the anticipated resolution of the proposed adjustments by the Competent Authority of each country. We are no longer subject to Mexican federal income tax examinations by the Servicio de Administracion Tributaria (“SAT”) for years before 2008. We work with the IRS, the CRA, and the SAT to resolve proposed audit adjustments and to minimize the amount of adjustments. We do not anticipate that any potential tax adjustments will have a significant impact on our financial position or results of operations. | |||||||||||||
We reasonably expect reductions in the liability for unrecognized tax benefits of approximately $81.2 million within the next 12 months due to proposed adjustments and settlements associated with tax audits and the expiration of statutes of limitations. | |||||||||||||
As of December 31, 2013, we had approximately $121.3 million of undistributed earnings of our international subsidiaries. We intend to continue to reinvest earnings outside the U.S. for the foreseeable future and, therefore, have not recognized any U.S. tax expense on these earnings. |
PENSION_AND_OTHER_POSTRETIREME
PENSION AND OTHER POST-RETIREMENT BENEFIT PLANS | 12 Months Ended | ||||||||||||||||||||||||
Dec. 31, 2013 | |||||||||||||||||||||||||
Compensation and Retirement Disclosure [Abstract] | ' | ||||||||||||||||||||||||
PENSION AND OTHER POST-RETIREMENT BENEFIT PLANS | ' | ||||||||||||||||||||||||
PENSION AND OTHER POST-RETIREMENT BENEFIT PLANS | |||||||||||||||||||||||||
We sponsor a number of defined benefit pension plans. Our policy is to fund domestic pension liabilities in accordance with the limits imposed by the Employee Retirement Income Security Act of 1974 (“ERISA”), federal income tax laws and the funding requirements of the Pension Protection Act of 2006. We fund non-domestic pension liabilities in accordance with laws and regulations applicable to those plans. | |||||||||||||||||||||||||
We have two post-retirement benefit plans: health care and life insurance. The health care plan is contributory, with participants’ contributions adjusted annually. The life insurance plan is non-contributory. | |||||||||||||||||||||||||
Obligations and Funded Status | |||||||||||||||||||||||||
A summary of the changes in benefit obligations and plan assets is as follows: | |||||||||||||||||||||||||
Pension Benefits | Other Benefits | ||||||||||||||||||||||||
December 31, | 2013 | 2012 | 2013 | 2012 | |||||||||||||||||||||
In thousands of dollars | |||||||||||||||||||||||||
Change in benefit obligation | |||||||||||||||||||||||||
Projected benefits obligation at beginning of year | $ | 1,237,778 | $ | 1,156,756 | $ | 318,415 | $ | 318,536 | |||||||||||||||||
Service cost | 31,339 | 30,823 | 1,094 | 1,172 | |||||||||||||||||||||
Interest cost | 43,962 | 49,909 | 10,747 | 13,258 | |||||||||||||||||||||
Plan amendments | 55 | 2 | — | — | |||||||||||||||||||||
Actuarial (gain) loss | (100,872 | ) | 112,700 | (33,412 | ) | 7,916 | |||||||||||||||||||
Curtailment | (8,833 | ) | — | — | — | ||||||||||||||||||||
Settlement | (319 | ) | (49,876 | ) | — | — | |||||||||||||||||||
Currency translation and other | (5,976 | ) | 1,903 | (1,030 | ) | 370 | |||||||||||||||||||
Benefits paid | (76,642 | ) | (64,439 | ) | (24,877 | ) | (22,837 | ) | |||||||||||||||||
Projected benefits obligation at end of year | 1,120,492 | 1,237,778 | 270,937 | 318,415 | |||||||||||||||||||||
Change in plan assets | |||||||||||||||||||||||||
Fair value of plan assets at beginning of year | 988,167 | 961,421 | — | — | |||||||||||||||||||||
Actual return on plan assets | 152,976 | 118,073 | — | — | |||||||||||||||||||||
Employer contribution | 32,336 | 21,371 | 24,877 | 22,837 | |||||||||||||||||||||
Settlement | (319 | ) | (49,876 | ) | — | — | |||||||||||||||||||
Currency translation and other | (4,533 | ) | 1,617 | — | — | ||||||||||||||||||||
Benefits paid | (76,642 | ) | (64,439 | ) | (24,877 | ) | (22,837 | ) | |||||||||||||||||
Fair value of plan assets at end of year | 1,091,985 | 988,167 | — | — | |||||||||||||||||||||
Funded status at end of year | $ | (28,507 | ) | $ | (249,611 | ) | $ | (270,937 | ) | $ | (318,415 | ) | |||||||||||||
The accumulated benefit obligation for all defined benefit pension plans was $1.1 billion as of December 31, 2013 and $1.2 billion as of December 31, 2012. | |||||||||||||||||||||||||
We made total contributions to the pension plans of $32.3 million during 2013, including contributions of $25.0 million to improve the funded status of our domestic plans. In 2012, we made total contributions of $21.4 million to the pension plans. For 2014, minimum funding requirements for our pension plans are approximately $3.6 million and we expect to make additional contributions of approximately $22.0 million to improve the funded status of our domestic plans. | |||||||||||||||||||||||||
Amounts recognized in the Consolidated Balance Sheets consisted of the following: | |||||||||||||||||||||||||
Pension Benefits | Other Benefits | ||||||||||||||||||||||||
December 31, | 2013 | 2012 | 2013 | 2012 | |||||||||||||||||||||
In thousands of dollars | |||||||||||||||||||||||||
Other assets | $ | 32,533 | $ | — | $ | — | $ | — | |||||||||||||||||
Accrued liabilities | (10,198 | ) | (9,396 | ) | (25,477 | ) | (26,181 | ) | |||||||||||||||||
Other long-term liabilities | (50,842 | ) | (240,215 | ) | (245,460 | ) | (292,234 | ) | |||||||||||||||||
Total | $ | (28,507 | ) | $ | (249,611 | ) | $ | (270,937 | ) | $ | (318,415 | ) | |||||||||||||
Amounts recognized in accumulated other comprehensive loss, net of tax, consisted of the following: | |||||||||||||||||||||||||
Pension Benefits | Other Benefits | ||||||||||||||||||||||||
December 31, | 2013 | 2012 | 2013 | 2012 | |||||||||||||||||||||
In thousands of dollars | |||||||||||||||||||||||||
Actuarial net (loss) gain | $ | (215,702 | ) | $ | (362,039 | ) | $ | 13,107 | $ | (6,320 | ) | ||||||||||||||
Net prior service credit (cost) | 5,698 | 5,539 | (2,737 | ) | (3,217 | ) | |||||||||||||||||||
Total | $ | (210,004 | ) | $ | (356,500 | ) | $ | 10,370 | $ | (9,537 | ) | ||||||||||||||
Plans with accumulated benefit obligations in excess of plan assets were as follows: | |||||||||||||||||||||||||
December 31, | 2013 | 2012 | |||||||||||||||||||||||
In thousands of dollars | |||||||||||||||||||||||||
Projected benefit obligation | $ | 76,801 | $ | 1,237,238 | |||||||||||||||||||||
Accumulated benefit obligation | 64,340 | 1,185,214 | |||||||||||||||||||||||
Fair value of plan assets | 15,760 | 987,643 | |||||||||||||||||||||||
Components of Net Periodic Benefit Cost and Other Amounts Recognized in Other Comprehensive Income | |||||||||||||||||||||||||
Net periodic benefit cost for our pension and other post-retirement plans consisted of the following: | |||||||||||||||||||||||||
Pension Benefits | Other Benefits | ||||||||||||||||||||||||
For the years ended December 31, | 2013 | 2012 | 2011 | 2013 | 2012 | 2011 | |||||||||||||||||||
In thousands of dollars | |||||||||||||||||||||||||
Service cost | $ | 31,339 | $ | 30,823 | $ | 30,059 | $ | 1,094 | $ | 1,172 | $ | 1,333 | |||||||||||||
Interest cost | 43,962 | 49,909 | 52,960 | 10,747 | 13,258 | 14,967 | |||||||||||||||||||
Expected return on plan assets | (73,128 | ) | (72,949 | ) | (78,161 | ) | — | — | — | ||||||||||||||||
Amortization of prior service cost (credit) | 422 | 731 | 1,002 | 618 | 619 | (255 | ) | ||||||||||||||||||
Amortization of net loss (gain) | 40,397 | 39,723 | 28,004 | (73 | ) | (101 | ) | (71 | ) | ||||||||||||||||
Administrative expenses | 692 | 545 | 653 | 75 | 120 | 244 | |||||||||||||||||||
Net periodic benefit cost | 43,684 | 48,782 | 34,517 | 12,461 | 15,068 | 16,218 | |||||||||||||||||||
Curtailment (credit) loss | (364 | ) | — | 1,826 | — | — | (174 | ) | |||||||||||||||||
Settlement loss | 18 | 19,676 | 46 | — | — | — | |||||||||||||||||||
Total amount reflected in earnings | $ | 43,338 | $ | 68,458 | $ | 36,389 | $ | 12,461 | $ | 15,068 | $ | 16,044 | |||||||||||||
A portion of the pension settlement loss recorded in 2012, totaling approximately $15.8 million, and the curtailment loss recorded in 2011 were associated with the Next Century program. The settlement losses recorded in 2011 were associated with one of our international businesses. We discuss the Next Century program in Note 3, Business Realignment and Impairment Charges. | |||||||||||||||||||||||||
Amounts recognized in other comprehensive loss (income) and net periodic benefit cost before tax for our pension and other post-retirement plans consisted of the following: | |||||||||||||||||||||||||
Pension Benefits | Other Benefits | ||||||||||||||||||||||||
For the years ended December 31, | 2013 | 2012 | 2011 | 2013 | 2012 | 2011 | |||||||||||||||||||
In thousands of dollars | |||||||||||||||||||||||||
Actuarial net (gain) loss | $ | (230,605 | ) | $ | 8,536 | $ | 120,401 | $ | (33,165 | ) | $ | 7,952 | $ | 11,216 | |||||||||||
Prior service (credit) cost | (613 | ) | (716 | ) | (1,313 | ) | (632 | ) | (613 | ) | 7,614 | ||||||||||||||
Total recognized in other comprehensive (income) loss | $ | (231,218 | ) | $ | 7,820 | $ | 119,088 | $ | (33,797 | ) | $ | 7,339 | $ | 18,830 | |||||||||||
Total recognized in net periodic benefit cost and other comprehensive (income) loss | $ | (187,534 | ) | $ | 56,602 | $ | 153,605 | $ | (21,336 | ) | $ | 22,407 | $ | 35,048 | |||||||||||
The estimated amounts for the defined benefit pension plans and the post-retirement benefit plans that will be amortized from accumulated other comprehensive income (loss) into net periodic benefit cost over the next fiscal year are as follows (in thousands): | |||||||||||||||||||||||||
Pension Plans | Post-Retirement | ||||||||||||||||||||||||
Benefit Plans | |||||||||||||||||||||||||
Amortization of net actuarial loss (gain) | $ | 22,952 | $ | (109 | ) | ||||||||||||||||||||
Amortization of prior service (credit) cost | $ | (668 | ) | $ | 618 | ||||||||||||||||||||
Assumptions | |||||||||||||||||||||||||
Certain weighted-average assumptions used in computing the benefit obligations as of December 31, 2013 and 2012 were as follows: | |||||||||||||||||||||||||
Pension Benefits | Other Benefits | ||||||||||||||||||||||||
2013 | 2012 | 2013 | 2012 | ||||||||||||||||||||||
Discount rate | 4.5 | % | 3.7 | % | 4.5 | % | 3.7 | % | |||||||||||||||||
Rate of increase in compensation levels | 4 | % | 4 | % | N/A | N/A | |||||||||||||||||||
For measurement purposes as of December 31, 2013, we assumed an 8.5% annual rate of increase in the per capita cost of covered health care benefits for 2014, grading down to 5.0% by 2019. | |||||||||||||||||||||||||
For measurement purposes as of December 31, 2012, we assumed a 9.1% annual rate of increase in the per capita cost of covered health care benefits for 2013, grading down to 5.0% by 2019. | |||||||||||||||||||||||||
Certain weighted-average assumptions used in computing net periodic benefit cost were as follows: | |||||||||||||||||||||||||
Pension Benefits | Other Benefits | ||||||||||||||||||||||||
For the years ended December 31, | 2013 | 2012 | 2011 | 2013 | 2012 | 2011 | |||||||||||||||||||
Discount rate | 3.7 | % | 4.5 | % | 5.2 | % | 3.7 | % | 4.5 | % | 5.2 | % | |||||||||||||
Expected long-term return on plan assets | 7.75 | % | 8 | % | 8 | % | N/A | N/A | N/A | ||||||||||||||||
Rate of compensation increase | 4 | % | 4.1 | % | 4.1 | % | N/A | N/A | N/A | ||||||||||||||||
We based the asset return assumption of 7.75% for 2013, 8.0% for 2012 and 8.0% for 2011 on current and expected asset allocations, as well as historical and expected returns on the plan asset categories. For 2014, we reduced the expected return on plan assets assumption to 7.0% from the 7.75% assumption used during 2013, reflecting lower expected future returns on plan assets resulting from a reduction of the pension plan asset allocation to equity securities. The historical geometric average return over the 26 years prior to December 31, 2013, was approximately 8.7%. | |||||||||||||||||||||||||
Assumed health care cost trend rates have a significant effect on the amounts reported for the post-retirement health care plans. A one-percentage point change in assumed health care cost trend rates would have the following effects: | |||||||||||||||||||||||||
Impact of assumed health care cost trend rates | One-Percentage | One-Percentage | |||||||||||||||||||||||
Point Increase | Point (Decrease) | ||||||||||||||||||||||||
In thousands of dollars | |||||||||||||||||||||||||
Effect on total service and interest cost components | $ | 172 | $ | (152 | ) | ||||||||||||||||||||
Effect on post-retirement benefit obligation | 4,132 | (3,697 | ) | ||||||||||||||||||||||
Plan Assets | |||||||||||||||||||||||||
We broadly diversify our pension plan assets across domestic and international common stock and fixed income asset classes. Our asset investment policies specify ranges of asset allocation percentages for each asset class. The ranges for the domestic pension plans were as follows: | |||||||||||||||||||||||||
Asset Class | Target Allocation 2013 | ||||||||||||||||||||||||
Equity securities | 55 | % | - | 75% | |||||||||||||||||||||
Debt securities | 25 | % | - | 45% | |||||||||||||||||||||
Cash and certain other investments | 0 | % | - | 5% | |||||||||||||||||||||
As of December 31, 2013, actual allocations were within the specified ranges. We expect the level of volatility in pension plan asset returns to be in line with the overall volatility of the markets within each asset class. | |||||||||||||||||||||||||
The following table sets forth by level, within the fair value hierarchy, pension plan assets at their fair value as of December 31, 2013: | |||||||||||||||||||||||||
In thousands of dollars | Quoted prices in active markets of identical assets | Significant other observable inputs | Significant other unobservable | Total assets measured at fair value as of | |||||||||||||||||||||
(Level 1) | (Level 2) | inputs (Level 3) | December 31, 2013 | ||||||||||||||||||||||
Cash and cash equivalents | $ | 657 | $ | 22,998 | $ | — | $ | 23,655 | |||||||||||||||||
Equity securities: | |||||||||||||||||||||||||
U.S. all-cap (a) | 64,949 | 137,385 | — | 202,334 | |||||||||||||||||||||
U.S. large-cap (b) | 144,254 | — | — | 144,254 | |||||||||||||||||||||
U.S. small/mid-cap | 33,145 | — | — | 33,145 | |||||||||||||||||||||
International all-cap (c) | 136,892 | 3,062 | — | 139,954 | |||||||||||||||||||||
Global all-cap (d) | 181,702 | — | — | 181,702 | |||||||||||||||||||||
Fixed income securities: | |||||||||||||||||||||||||
U.S. government/agency | 109,995 | 34,907 | — | 144,902 | |||||||||||||||||||||
Corporate bonds (e) | 57,735 | 34,616 | — | 92,351 | |||||||||||||||||||||
Collateralized obligations (f) | 56,016 | 22,350 | — | 78,366 | |||||||||||||||||||||
International government/ corporate bonds (g) | 14,018 | 37,304 | — | 51,322 | |||||||||||||||||||||
Total Investments | $ | 799,363 | $ | 292,622 | $ | — | $ | 1,091,985 | |||||||||||||||||
The following table sets forth by level, within the fair value hierarchy, pension plan assets at their fair value as of December 31, 2012: | |||||||||||||||||||||||||
In thousands of dollars | Quoted prices in active markets of identical assets | Significant other observable inputs(Level 2) | Significant other unobservable | Total assets measured at fair value as of | |||||||||||||||||||||
(Level 1) | inputs (Level 3) | December 31, 2012 | |||||||||||||||||||||||
Cash and cash equivalents | $ | 933 | $ | 34,027 | $ | — | $ | 34,960 | |||||||||||||||||
Equity securities: | |||||||||||||||||||||||||
U.S. all-cap (a) | 50,596 | 104,102 | — | 154,698 | |||||||||||||||||||||
U.S. large-cap (b) | 107,934 | — | — | 107,934 | |||||||||||||||||||||
U.S. small/mid-cap | 24,816 | — | — | 24,816 | |||||||||||||||||||||
International all-cap (c) | 111,834 | 2,938 | — | 114,772 | |||||||||||||||||||||
Global all-cap (d) | 229,044 | — | — | 229,044 | |||||||||||||||||||||
Domestic real estate | 24,892 | — | — | 24,892 | |||||||||||||||||||||
Fixed income securities: | |||||||||||||||||||||||||
U.S. government/agency | 76,009 | 27,984 | — | 103,993 | |||||||||||||||||||||
Corporate bonds (e) | 38,001 | 19,691 | — | 57,692 | |||||||||||||||||||||
Collateralized obligations (f) | 61,853 | 27,012 | — | 88,865 | |||||||||||||||||||||
International government/corporate bonds (g) | 13,432 | 33,069 | — | 46,501 | |||||||||||||||||||||
Total Investments | $ | 739,344 | $ | 248,823 | $ | — | $ | 988,167 | |||||||||||||||||
(a) | This category comprises equity funds that track the Russell 3000 index. | ||||||||||||||||||||||||
(b) | This category comprises equity funds that track the S&P 500 and/or Russell 1000 indices. | ||||||||||||||||||||||||
(c) | This category comprises equity funds that track the MSCI World Ex-US index. | ||||||||||||||||||||||||
(d) | This category comprises equity funds that track the MSCI World index. | ||||||||||||||||||||||||
(e) | This category comprises fixed income funds primarily invested in investment grade bonds. | ||||||||||||||||||||||||
(f) | This category comprises fixed income funds primarily invested in high quality mortgage-backed securities and other asset-backed obligations. | ||||||||||||||||||||||||
(g) | This category comprises fixed income funds invested in Canadian and other international bonds. | ||||||||||||||||||||||||
The fair value of the Level 1 assets was based on quoted market prices in active markets for the identical assets. The fair value of the Level 2 assets was determined by management based on an assessment of valuations provided by asset management entities and was calculated by aggregating market prices for all underlying securities. | |||||||||||||||||||||||||
Investment objectives for our domestic plan assets are: | |||||||||||||||||||||||||
l | To optimize the long-term return on plan assets at an acceptable level of risk; | ||||||||||||||||||||||||
l | To maintain a broad diversification across asset classes; | ||||||||||||||||||||||||
l | To maintain careful control of the risk level within each asset class; and | ||||||||||||||||||||||||
l | To focus on a long-term return objective. | ||||||||||||||||||||||||
We believe that there are no significant concentrations of risk within our plan assets as of December 31, 2013. We comply with ERISA rules and regulations and we prohibit investments and investment strategies not allowed by ERISA. We do not permit direct purchases of our Company’s securities or the use of derivatives for the purpose of speculation. We invest the assets of non-domestic plans in compliance with laws and regulations applicable to those plans. | |||||||||||||||||||||||||
Cash Flows | |||||||||||||||||||||||||
Information about the expected cash flows for our pension and other post-retirement benefit plans is as follows: | |||||||||||||||||||||||||
Expected Benefit Payments | |||||||||||||||||||||||||
2014 | 2015 | 2016 | 2017 | 2018 | 2019-2023 | ||||||||||||||||||||
In thousands of dollars | |||||||||||||||||||||||||
Pension Benefits | $ | 67,617 | $ | 64,641 | $ | 69,085 | $ | 101,765 | $ | 83,559 | $ | 544,322 | |||||||||||||
Other Benefits | 25,491 | 24,690 | 23,796 | 22,411 | 20,843 | 85,699 | |||||||||||||||||||
Multiemployer Pension Plan | |||||||||||||||||||||||||
With the acquisition of Brookside Foods Ltd. in January 2012, we began participation in the Bakery and Confectionery Union and Industry Canadian Pension Fund, a trustee-managed multiemployer defined benefit pension plan. We currently have approximately 110 employees participating in the plan and contributions were not significant in 2013 and 2012. Our obligation during the term of the collective bargaining agreement is limited to remitting the required contributions to the plan. |
SAVINGS_PLANS
SAVINGS PLANS | 12 Months Ended |
Dec. 31, 2013 | |
Savings Plans [Abstract] | ' |
Savings Plans | ' |
SAVINGS PLANS | |
The Company sponsors several defined contribution plans to provide retirement benefits to employees. Contributions to The Hershey Company 401(k) Plan and similar plans for non-domestic employees are based on a portion of eligible pay up to a defined maximum. All matching contributions were made in cash. Expense associated with the defined contribution plans was $43.3 million in 2013, $39.8 million in 2012 and $35.8 million in 2011. |
CAPITAL_STOCK_AND_NET_INCOME_P
CAPITAL STOCK AND NET INCOME PER SHARE | 12 Months Ended | ||||||||||||
Dec. 31, 2013 | |||||||||||||
Capital Stock and Net Income Per Share [Abstract] | ' | ||||||||||||
Capital Stock and Net Income Per Share | ' | ||||||||||||
CAPITAL STOCK AND NET INCOME PER SHARE | |||||||||||||
We had 1,055,000,000 authorized shares of capital stock as of December 31, 2013. Of this total, 900,000,000 shares were designated as Common Stock, 150,000,000 shares as Class B Common Stock (“Class B Stock”) and 5,000,000 shares as Preferred Stock. Each class has a par value of one dollar per share. As of December 31, 2013, a combined total of 359,901,744 shares of both classes of common stock had been issued of which 223,894,721 shares were outstanding. No shares of the Preferred Stock were issued or outstanding during the 3-year period ended December 31, 2013. | |||||||||||||
Holders of the Common Stock and the Class B Stock generally vote together without regard to class on matters submitted to stockholders, including the election of directors. The holders of Common Stock have 1 vote per share and the holders of Class B Stock have 10 votes per share. However, the Common Stock holders, voting separately as a class, are entitled to elect one-sixth of the Board of Directors. With respect to dividend rights, the Common Stock holders are entitled to cash dividends 10% higher than those declared and paid on the Class B Stock. | |||||||||||||
Class B Stock can be converted into Common Stock on a share-for-share basis at any time. During 2013, 8,600 shares of Class B Stock were converted into Common Stock. During 2012, 3,225 shares were converted and during 2011, 74,377 shares were converted. | |||||||||||||
Milton Hershey School Trust | |||||||||||||
Hershey Trust Company, as trustee for the benefit of Milton Hershey School and as direct owner of investment shares, held 12,902,721 shares of our Common Stock as of December 31, 2013. As trustee for the benefit of Milton Hershey School, Hershey Trust Company held 60,612,012 shares of the Class B Stock as of December 31, 2013, and was entitled to cast approximately 80% of all of the votes entitled to be cast on matters requiring the vote of both classes of our common stock voting together. Hershey Trust Company, as Trustee for the benefit of Milton Hershey School, or any successor trustee, or Milton Hershey School, as appropriate, must approve any issuance of shares of Common Stock or other action that would result in it not continuing to have voting control of our Company. | |||||||||||||
Changes in outstanding Common Stock for the past 3 years were as follows: | |||||||||||||
For the years ended December 31, | 2013 | 2012 | 2011 | ||||||||||
Shares issued | 359,901,744 | 359,901,744 | 359,901,744 | ||||||||||
Treasury shares at beginning of year | (136,115,714 | ) | (134,695,826 | ) | (132,871,512 | ) | |||||||
Stock repurchases: | |||||||||||||
Repurchase programs | — | (2,054,354 | ) | (1,902,753 | ) | ||||||||
Stock-based compensation programs | (3,655,830 | ) | (5,598,537 | ) | (5,179,028 | ) | |||||||
Stock issuances: | |||||||||||||
Stock-based compensation programs | 3,764,521 | 6,233,003 | 5,257,467 | ||||||||||
Treasury shares at end of year | (136,007,023 | ) | (136,115,714 | ) | (134,695,826 | ) | |||||||
Net shares outstanding at end of year | 223,894,721 | 223,786,030 | 225,205,918 | ||||||||||
Basic and Diluted Earnings Per Share were computed based on the weighted-average number of shares of the Common Stock and the Class B Stock outstanding as follows: | |||||||||||||
For the years ended December 31, | 2013 | 2012 | 2011 | ||||||||||
In thousands except per share amounts | |||||||||||||
Net income | $ | 820,470 | $ | 660,931 | $ | 628,962 | |||||||
Weighted-average shares—Basic | |||||||||||||
Common Stock | 163,549 | 164,406 | 165,929 | ||||||||||
Class B Stock | 60,627 | 60,630 | 60,645 | ||||||||||
Total weighted-average shares—Basic | 224,176 | 225,036 | 226,574 | ||||||||||
Effect of dilutive securities: | |||||||||||||
Employee stock options | 2,476 | 2,608 | 2,565 | ||||||||||
Performance and restricted stock units | 551 | 693 | 780 | ||||||||||
Weighted-average shares—Diluted | 227,203 | 228,337 | 229,919 | ||||||||||
Earnings Per Share—Basic | |||||||||||||
Common Stock | $3.76 | $3.01 | $2.85 | ||||||||||
Class B Stock | $3.39 | $2.73 | $2.58 | ||||||||||
Earnings Per Share—Diluted | |||||||||||||
Common Stock | $3.61 | $2.89 | $2.74 | ||||||||||
Class B Stock | $3.37 | $2.71 | $2.56 | ||||||||||
For the year ended December 31, 2013, approximately 1.8 million stock options were not included in the diluted earnings per share calculation because the exercise price was higher than the average market price of the Common Stock for the year. Therefore, the effect would have been antidilutive. In 2012, 3.5 million stock options were not included and, in 2011, 6.9 million stock options were not included in the diluted earnings per share calculation because the effect would have been antidilutive. |
STOCK_COMPENSATION_PLAN
STOCK COMPENSATION PLAN | 12 Months Ended | ||||||||||||||||||
Dec. 31, 2013 | |||||||||||||||||||
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | ' | ||||||||||||||||||
STOCK COMPENSATION PLANS | ' | ||||||||||||||||||
STOCK COMPENSATION PLANS | |||||||||||||||||||
The Equity and Incentive Compensation Plan (“EICP”) is the plan under which grants using shares for compensation and incentive purposes are made. The EICP provides for grants of one or more of the following stock-based compensation awards to employees, non-employee directors and certain service providers upon whom the successful conduct of our business is dependent: | |||||||||||||||||||
l | Non-qualified stock options (“stock options”); | ||||||||||||||||||
l | Performance stock units (“PSUs”) and performance stock; | ||||||||||||||||||
l | Stock appreciation rights; | ||||||||||||||||||
l | Restricted stock units (“RSUs”) and restricted stock; and | ||||||||||||||||||
l | Other stock-based awards. | ||||||||||||||||||
The EICP also provides for the deferral of stock-based compensation awards by participants if approved by the Compensation and Executive Organization Committee of our Board and if in accordance with an applicable deferred compensation plan of the Company. Currently, the Compensation and Executive Organization Committee has authorized the deferral of performance stock unit and restricted stock unit awards by certain eligible employees under the Company’s Deferred Compensation Plan. Our Board has authorized our non-employee directors to defer any portion of their cash retainer, committee chair fees and restricted stock units awarded after 2007 that they elect to convert into deferred stock units under our Directors’ Compensation Plan. As of December 31, 2013, 68.5 million shares were authorized and approved by our stockholders for grants under the EICP. | |||||||||||||||||||
In July 2004, we announced a worldwide stock option grant under the Broad Based Stock Option Plan. This grant provided over 13,000 eligible employees with 100 non-qualified stock options. The stock options were granted at a price of $46.44 per share, have a term of 10 years and vested on July 19, 2009. | |||||||||||||||||||
The following table summarizes our compensation costs: | |||||||||||||||||||
For the years ended December 31, | 2013 | 2012 | 2011 | ||||||||||||||||
In millions of dollars | |||||||||||||||||||
Total compensation amount charged against income for stock compensation plans, including stock options, performance stock units and restricted stock units | $ | 54 | $ | 50.5 | $ | 43.5 | |||||||||||||
Total income tax benefit recognized in Consolidated Statements of Income for share-based compensation | $ | 18.5 | $ | 17.5 | $ | 15.1 | |||||||||||||
Compensation costs for stock compensation plans are primarily included in selling, marketing and administrative expense. | |||||||||||||||||||
The increase in share-based compensation expense from 2012 to 2013 resulted primarily from an increase in the compensation amount upon which the number of stock-based awards was based. The increase in share-based compensation expense from 2011 to 2012 was due to certain adjustments associated with accounting for PSUs and the impact of the forfeiture of unvested awards due to participant changes which reduced expense in 2011. | |||||||||||||||||||
Stock Options | |||||||||||||||||||
The exercise price of each option awarded under the EICP equals the closing price of our Common Stock on the New York Stock Exchange on the date of grant. Prior to the initial approval by our stockholders of the EICP on April 17, 2007, the exercise price of stock options granted under the former Key Employee Incentive Plan was determined as the closing price of our Common Stock on the New York Stock Exchange on the trading day immediately preceding the date the stock options were granted. Each option has a maximum term of 10 years. Grants of stock options provide for pro-rated vesting primarily over four years. We recognize expense for stock options based on the straight-line method as of the grant date fair value. | |||||||||||||||||||
The following table summarizes our compensation costs for stock options: | |||||||||||||||||||
For the years ended December 31, | 2013 | 2012 | 2011 | ||||||||||||||||
In millions of dollars | |||||||||||||||||||
Compensation amount charged against income for stock options | $ | 21.4 | $ | 19.3 | $ | 22.5 | |||||||||||||
The increase in compensation cost from 2012 to 2013 was driven by an increase in the compensation amount upon which the number of stock options granted in 2013 was based. The decrease in compensation cost from 2011 to 2012 was primarily driven by the impact of the forfeitures of unvested awards due to participant changes during 2012 and 2011. | |||||||||||||||||||
A summary of the status of our Company’s stock options and changes during the last three years follows: | |||||||||||||||||||
2013 | 2012 | 2011 | |||||||||||||||||
Stock Options | Shares | Weighted- | Shares | Weighted- | Shares | Weighted- | |||||||||||||
Average | Average | Average | |||||||||||||||||
Exercise | Exercise | Exercise | |||||||||||||||||
Price | Price | Price | |||||||||||||||||
Outstanding at beginning of year | 10,553,914 | $48.08 | 14,540,442 | $44.86 | 17,997,082 | $42.21 | |||||||||||||
Granted | 1,779,109 | $81.95 | 2,110,945 | $60.89 | 2,191,627 | $51.62 | |||||||||||||
Exercised | (3,315,990 | ) | $45.25 | (5,870,607 | ) | $44.55 | (4,875,122 | ) | $38.30 | ||||||||||
Forfeited | (356,697 | ) | $64.38 | (226,866 | ) | $52.02 | (773,145 | ) | $43.90 | ||||||||||
Outstanding at end of year | 8,660,336 | $55.47 | 10,553,914 | $48.08 | 14,540,442 | $44.86 | |||||||||||||
Options exercisable at year-end | 4,290,416 | $46.45 | 5,320,775 | $45.74 | 8,453,362 | $46.95 | |||||||||||||
Weighted-average fair value of options granted during the year (per share) | $ | 14.51 | $ | 10.6 | $ | 9.97 | |||||||||||||
The following table sets forth information about the weighted-average fair value of options granted to employees during each year using the Black-Scholes option-pricing model and the weighted-average assumptions used for such grants: | |||||||||||||||||||
For the years ended December 31, | 2013 | 2012 | 2011 | ||||||||||||||||
Dividend yields | 2.2 | % | 2.4 | % | 2.7 | % | |||||||||||||
Expected volatility | 22.2 | % | 22.4 | % | 22.5 | % | |||||||||||||
Risk-free interest rates | 1.4 | % | 1.5 | % | 2.8 | % | |||||||||||||
Expected lives in years | 6.6 | 6.6 | 6.5 | ||||||||||||||||
l | “Dividend yields” means the sum of dividends declared for the four most recent quarterly periods, divided by the average price of our Common Stock for the comparable periods; | ||||||||||||||||||
l | “Expected volatility” means the historical volatility of our Common Stock over the expected term of each grant; | ||||||||||||||||||
l | “Risk-free interest rates” means the U.S. Treasury yield curve rate in effect at the time of grant for periods within the contractual life of the option; and | ||||||||||||||||||
l | “Expected lives” means the period of time that options granted are expected to be outstanding based primarily on historical data. | ||||||||||||||||||
The following table summarizes the intrinsic value of our stock options: | |||||||||||||||||||
For the years ended December 31, | 2013 | 2012 | 2011 | ||||||||||||||||
In millions of dollars | |||||||||||||||||||
Intrinsic value of options exercised | $ | 135.4 | $ | 130.2 | $ | 81.3 | |||||||||||||
The aggregate intrinsic value of options outstanding as of December 31, 2013 was $352.7 million. The aggregate intrinsic value of exercisable options as of December 31, 2013 was $213.4 million. | |||||||||||||||||||
As of December 31, 2013, there was $20.5 million of total unrecognized compensation cost related to non-vested stock option compensation arrangements granted under the EICP. We expect to recognize that cost over a weighted-average period of 2.4 years. | |||||||||||||||||||
The following table summarizes information about stock options outstanding as of December 31, 2013: | |||||||||||||||||||
Options Outstanding | Options Exercisable | ||||||||||||||||||
Range of Exercise Prices | Number | Weighted- | Weighted- | Number | Weighted- | ||||||||||||||
Outstanding as | Average | Average | Exercisable as of | Average | |||||||||||||||
of 12/31/13 | Remaining | Exercise Price | 12/31/13 | Exercise Price | |||||||||||||||
Contractual | |||||||||||||||||||
Life in Years | |||||||||||||||||||
$33.40 - $39.26 | 2,514,127 | 5 | $ | 37.19 | 2,000,140 | $ | 36.66 | ||||||||||||
$39.57 - $60.10 | 2,503,703 | 5.1 | $ | 51.94 | 1,595,372 | $ | 52.14 | ||||||||||||
$60.68 - $91.65 | 3,642,506 | 7.9 | $ | 70.51 | 694,904 | $ | 61.58 | ||||||||||||
$33.40 - $91.65 | 8,660,336 | 6.3 | $ | 55.47 | 4,290,416 | $ | 46.45 | ||||||||||||
Performance Stock Units and Restricted Stock Units | |||||||||||||||||||
Under the EICP, we grant PSUs to selected executives and other key employees. Vesting is contingent upon the achievement of certain performance objectives. We grant PSUs over 3-year performance cycles. If we meet targets for financial measures at the end of the applicable 3-year performance cycle, we award the full number of shares to the participants. For each PSU granted from 2011 through 2013, 50% of the target award was a market-based total shareholder return component and 50% of the target award was comprised of performance-based components. The performance scores for 2011 through 2013 grants of PSUs can range from 0% to 250% of the targeted amounts. | |||||||||||||||||||
We recognize the compensation cost associated with PSUs ratably over the 3-year term. Compensation cost is based on the grant date fair value because the grants can only be settled in shares of our Common Stock. The grant date fair value of PSUs is determined based on the Monte Carlo simulation model for the market-based total shareholder return component and the closing market price of the Company’s shares on the date of grant for performance-based components. | |||||||||||||||||||
In 2013, 2012 and 2011, we awarded RSUs to certain executive officers and other key employees under the EICP. We also awarded restricted stock units quarterly to non-employee directors. | |||||||||||||||||||
We recognize the compensation cost associated with employee RSUs over a specified restriction period based on the grant date fair value or year-end market value of the stock. We recognize expense for employee RSUs based on the straight-line method. We recognize the compensation cost associated with non-employee director RSUs ratably over the vesting period. | |||||||||||||||||||
For the years ended December 31, | 2013 | 2012 | 2011 | ||||||||||||||||
In millions of dollars | |||||||||||||||||||
Compensation amount charged against income for performance and restricted stock units | $ | 32.6 | $ | 31.2 | $ | 21 | |||||||||||||
Compensation expense for performance and restricted stock units was lower in 2011 resulting primarily from certain adjustments associated with the accounting for PSUs. In addition, the decrease in compensation expense in 2011 resulted from the impact of the forfeiture of unvested awards due to participant changes during 2011. | |||||||||||||||||||
The following table sets forth information about the fair value of the PSUs and RSUs granted for potential future distribution to employees and directors during the year. In addition, the table provides assumptions used to determine fair value of the market-based total shareholder return component using the Monte Carlo simulation model on the date of grant. | |||||||||||||||||||
For the years ended December 31, | 2013 | 2012 | 2011 | ||||||||||||||||
Units granted | 395,862 | 503,761 | 543,596 | ||||||||||||||||
Weighted-average fair value at date of grant | $ | 88.49 | $ | 64.99 | $ | 58.28 | |||||||||||||
Monte Carlo simulation assumptions: | |||||||||||||||||||
Estimated values | $ | 55.49 | $ | 35.62 | $ | 37.79 | |||||||||||||
Dividend yields | 2 | % | 2.5 | % | 2.7 | % | |||||||||||||
Expected volatility | 17.1 | % | 20 | % | 28.8 | % | |||||||||||||
l | “Estimated values” means the fair value for the market-based total shareholder return component of each performance stock unit at the date of grant using a Monte Carlo simulation model; | ||||||||||||||||||
l | “Dividend yields” means the sum of dividends declared for the four most recent quarterly periods, divided by the average price of our Common Stock for the comparable periods; | ||||||||||||||||||
l | “Expected volatility” means the historical volatility of our Common Stock over the expected term of each grant. | ||||||||||||||||||
A summary of the status of our Company’s performance stock units and restricted stock units as of December 31, 2013 and the change during 2013 follows: | |||||||||||||||||||
Performance Stock Units and Restricted Stock Units | 2013 | Weighted-average grant date fair value | |||||||||||||||||
for equity awards or market value for | |||||||||||||||||||
liability awards | |||||||||||||||||||
Outstanding at beginning of year | 1,720,577 | $56.71 | |||||||||||||||||
Granted | 395,862 | $88.49 | |||||||||||||||||
Performance assumption change | 176,534 | $84.27 | |||||||||||||||||
Vested | (754,991 | ) | $50.33 | ||||||||||||||||
Forfeited | (126,583 | ) | $71.80 | ||||||||||||||||
Outstanding at end of year | 1,411,399 | $72.43 | |||||||||||||||||
The table above excludes PSU awards for 29,596 units as of December 31, 2013 and 40,812 units as of December 31, 2012 for which the measurement date has not yet occurred for accounting purposes. | |||||||||||||||||||
As of December 31, 2013, there was $39.1 million of unrecognized compensation cost relating to non-vested PSUs and RSUs. We expect to recognize that cost over a weighted-average period of 2.1 years. | |||||||||||||||||||
For the years ended December 31, | 2013 | 2012 | 2011 | ||||||||||||||||
In millions of dollars | |||||||||||||||||||
Intrinsic value of share-based liabilities paid, combined with the fair value of shares vested | $ | 62.6 | $ | 37.3 | $ | 36.6 | |||||||||||||
The higher amount in 2013 was primarily due to the higher stock price at distribution in 2013 as compared with 2012 and 2011. | |||||||||||||||||||
Deferred PSUs, deferred RSUs, deferred directors’ fees and accumulated dividend amounts totaled 608,457 units as of December 31, 2013. | |||||||||||||||||||
We did not have any stock appreciation rights that were outstanding as of December 31, 2013. |
SUPPLEMENTAL_BALANCE_SHEET_INF
SUPPLEMENTAL BALANCE SHEET INFORMATION | 12 Months Ended | ||||||||||||||||||||
Dec. 31, 2013 | |||||||||||||||||||||
SUPPLEMENTAL BALANCE SHEET INFORMATION [Abstract] | ' | ||||||||||||||||||||
Supplemental Balance Sheet Information | ' | ||||||||||||||||||||
SUPPLEMENTAL BALANCE SHEET INFORMATION | |||||||||||||||||||||
Accounts Receivable—Trade | |||||||||||||||||||||
In the normal course of business, we extend credit to customers that satisfy pre-defined credit criteria, based upon the results of our recurring financial account reviews and our evaluation of current and projected economic conditions. Our primary concentrations of credit risk are associated with Wal-Mart Stores, Inc. and McLane Company, Inc. McLane Company, Inc. is one of the largest wholesale distributors in the United States to convenience stores, drug stores, wholesale clubs and mass merchandisers. As of December 31, 2013, McLane Company, Inc. accounted for approximately 17.3% of our total accounts receivable. Wal-Mart Stores, Inc. accounted for approximately 14.5% of our total accounts receivable as of December 31, 2013. No other customer accounted for more than 10% of our year-end accounts receivable. We believe that we have little concentration of credit risk associated with the remainder of our customer base. Accounts Receivable-Trade, as shown on the Consolidated Balance Sheets, were net of allowances and anticipated discounts of $14.3 million as of December 31, 2013 and $15.2 million as of December 31, 2012. | |||||||||||||||||||||
Inventories | |||||||||||||||||||||
We value the majority of our inventories in the U.S. under the last-in, first-out (“LIFO”) method. The remainder of our inventories in the U.S. and inventories for our international businesses are valued at the lower of first-in, first-out (“FIFO”) cost or market. Inventories include material, labor and overhead. LIFO cost of inventories valued using the LIFO method was $314.9 million as of December 31, 2013 and $331.7 million as of December 31, 2012. The net impact of LIFO acquisitions and liquidations during 2013 was not material. We stated inventories at amounts that did not exceed realizable values. Total inventories were as follows: | |||||||||||||||||||||
December 31, | 2013 | 2012 | |||||||||||||||||||
In thousands of dollars | |||||||||||||||||||||
Raw materials | $ | 226,978 | $ | 256,969 | |||||||||||||||||
Goods in process | 79,861 | 78,292 | |||||||||||||||||||
Finished goods | 517,968 | 496,981 | |||||||||||||||||||
Inventories at FIFO | 824,807 | 832,242 | |||||||||||||||||||
Adjustment to LIFO | (165,266 | ) | (198,980 | ) | |||||||||||||||||
Total inventories | $ | 659,541 | $ | 633,262 | |||||||||||||||||
Property, Plant and Equipment | |||||||||||||||||||||
The property, plant and equipment balance included construction in progress of $273.1 million as of December 31, 2013 and $217.5 million as of December 31, 2012. As of December 31, 2012, construction in progress included $41.1 million associated with payments made by Ferrero under an agreement for the construction of a warehouse and distribution facility of which the Company has been deemed to be the owner for accounting purposes. Major classes of property, plant and equipment were as follows: | |||||||||||||||||||||
December 31, | 2013 | 2012 | |||||||||||||||||||
In thousands of dollars | |||||||||||||||||||||
Land | $ | 96,334 | $ | 92,916 | |||||||||||||||||
Buildings | 956,890 | 878,527 | |||||||||||||||||||
Machinery and equipment | 2,726,170 | 2,589,183 | |||||||||||||||||||
Property, plant and equipment, gross | 3,779,394 | 3,560,626 | |||||||||||||||||||
Accumulated depreciation | (1,974,049 | ) | (1,886,555 | ) | |||||||||||||||||
Property, plant and equipment, net | $ | 1,805,345 | $ | 1,674,071 | |||||||||||||||||
During 2012, we recorded accelerated depreciation of property, plant and equipment of $15.3 million associated with the Next Century program. | |||||||||||||||||||||
Goodwill and Other Intangible Assets | |||||||||||||||||||||
Goodwill and intangible assets were as follows: | |||||||||||||||||||||
December 31, | 2013 | 2012 | |||||||||||||||||||
In thousands of dollars | |||||||||||||||||||||
Unamortized intangible assets: | |||||||||||||||||||||
Goodwill balance at beginning of year | $ | 588,003 | $ | 516,745 | |||||||||||||||||
Effect of foreign currency translation | (11,442 | ) | 3,284 | ||||||||||||||||||
Acquisitions | — | 67,974 | |||||||||||||||||||
Goodwill balance at end of year | $ | 576,561 | $ | 588,003 | |||||||||||||||||
Trademarks with indefinite lives | $ | 81,465 | $ | 81,465 | |||||||||||||||||
Amortized intangible assets, gross: | |||||||||||||||||||||
Trademarks | 64,436 | 68,490 | |||||||||||||||||||
Customer-related | 72,094 | 74,790 | |||||||||||||||||||
Intangible asset associated with cooperative agreement with Bauducco | 13,683 | 13,683 | |||||||||||||||||||
Patents | 19,278 | 20,018 | |||||||||||||||||||
Effect of foreign currency translation | (9,256 | ) | (6,470 | ) | |||||||||||||||||
Total other intangible assets, gross | 241,700 | 251,976 | |||||||||||||||||||
Accumulated amortization: | |||||||||||||||||||||
Trademarks | (5,190 | ) | (2,250 | ) | |||||||||||||||||
Customer-related | (26,853 | ) | (22,990 | ) | |||||||||||||||||
Intangible asset associated with cooperative agreement with Bauducco | (7,379 | ) | (6,294 | ) | |||||||||||||||||
Patents | (9,737 | ) | (7,411 | ) | |||||||||||||||||
Effect of foreign currency translation | 2,703 | 1,682 | |||||||||||||||||||
Total accumulated amortization | (46,456 | ) | (37,263 | ) | |||||||||||||||||
Other intangibles | $ | 195,244 | $ | 214,713 | |||||||||||||||||
In January 2012, we acquired all of the outstanding stock of Brookside, a privately held confectionery company based in Abbotsford, British Columbia, Canada. For more information, see Note 2, Business Acquisitions. | |||||||||||||||||||||
Accumulated impairment losses associated with goodwill were $70.1 million as of December 31, 2013, and 2012. Accumulated impairment losses associated with trademarks were $46.7 million as of December 31, 2013, and 2012. | |||||||||||||||||||||
The useful lives of certain trademarks were determined to be indefinite and, therefore, we are not amortizing these assets. We amortize customer-related intangible assets over their estimated useful lives of approximately 15 years. We amortize trademarks with finite lives over their estimated useful lives of 25 years. We amortize patents over their remaining legal lives of approximately 5 years. Total amortization expense for other intangible assets was $10.8 million in 2013, $10.6 million in 2012 and $4.6 million in 2011. | |||||||||||||||||||||
Estimated annual amortization expense for other intangible assets over the next five years is as follows: | |||||||||||||||||||||
Annual Amortization Expense | 2014 | 2015 | 2016 | 2017 | 2018 | ||||||||||||||||
In thousands of dollars | |||||||||||||||||||||
Estimated amortization expense | $ | 10,452 | $ | 9,916 | $ | 9,913 | $ | 9,245 | $ | 8,151 | |||||||||||
Accrued Liabilities | |||||||||||||||||||||
Accrued liabilities were as follows: | |||||||||||||||||||||
December 31, | 2013 | 2012 | |||||||||||||||||||
In thousands of dollars | |||||||||||||||||||||
Payroll, compensation and benefits | $ | 245,641 | $ | 236,598 | |||||||||||||||||
Advertising and promotion | 348,966 | 289,221 | |||||||||||||||||||
Other | 105,115 | 125,087 | |||||||||||||||||||
Total accrued liabilities | $ | 699,722 | $ | 650,906 | |||||||||||||||||
Other Long-term Liabilities | |||||||||||||||||||||
Other long-term liabilities were as follows: | |||||||||||||||||||||
December 31, | 2013 | 2012 | |||||||||||||||||||
In thousands of dollars | |||||||||||||||||||||
Post-retirement benefits liabilities | $ | 245,460 | $ | 292,234 | |||||||||||||||||
Pension benefits liabilities | 50,842 | 240,215 | |||||||||||||||||||
Other | 137,766 | 136,283 | |||||||||||||||||||
Total other long-term liabilities | $ | 434,068 | $ | 668,732 | |||||||||||||||||
SEGMENT_INFORMATION
SEGMENT INFORMATION | 12 Months Ended |
Dec. 31, 2013 | |
Segment Reporting [Abstract] | ' |
Segment Information | ' |
SEGMENT INFORMATION | |
We operate as a single reportable segment in manufacturing, marketing, selling and distributing our products under more than 80 brand names. Our two operating segments comprise geographic regions including North America, including the United States and Canada, and International which includes Latin America, Asia, Europe, Africa and exports to these regions. We market our products in approximately 70 countries worldwide. | |
For segment reporting purposes, we aggregate the operations of North America and International to form one reportable segment. We base this aggregation on similar economic characteristics, products and services; production processes; types or classes of customers; distribution methods; and the similar nature of the regulatory environment in each location. | |
The percentage of total consolidated net sales for businesses outside of the United States was 16.6% for 2013, 16.2% for 2012 and 15.7% for 2011. The percentage of total consolidated assets outside of the United States as of December 31, 2013 was 19.4%, and 20.5% as of December 31, 2012. | |
Sales to McLane Company, Inc., one of the largest wholesale distributors in the United States to convenience stores, drug stores, wholesale clubs and mass merchandisers, exceeded 10% of total net sales in each of the last three years, totaling $1.8 billion in 2013, $1.5 billion in 2012 and $1.4 billion in 2011. McLane Company, Inc. is the primary distributor of our products to Wal-Mart Stores, Inc. |
QUARTERLY_DATA
QUARTERLY DATA | 12 Months Ended | ||||||||||||||||
Dec. 31, 2013 | |||||||||||||||||
Quarterly Data [Abstract] | ' | ||||||||||||||||
Quarterly Data | ' | ||||||||||||||||
QUARTERLY DATA (Unaudited) | |||||||||||||||||
Summary quarterly results were as follows: | |||||||||||||||||
Year 2013 | First | Second | Third | Fourth | |||||||||||||
In thousands of dollars except per share amounts | |||||||||||||||||
Net sales | $ | 1,827,426 | $ | 1,508,514 | $ | 1,853,886 | $ | 1,956,253 | |||||||||
Gross profit | 849,337 | 718,574 | 855,551 | 857,386 | |||||||||||||
Net income | 241,906 | 159,504 | 232,985 | 186,075 | |||||||||||||
Class B Common Stock: | |||||||||||||||||
Net income per share—Basic | 1 | 0.66 | 0.96 | 0.77 | |||||||||||||
Net income per share—Diluted(a) | 0.99 | 0.66 | 0.95 | 0.76 | |||||||||||||
Dividends paid per share | 0.38 | 0.38 | 0.435 | 0.435 | |||||||||||||
Common Stock: | |||||||||||||||||
Net income per share—Basic | 1.11 | 0.73 | 1.07 | 0.85 | |||||||||||||
Net income per share—Diluted | 1.06 | 0.7 | 1.03 | 0.82 | |||||||||||||
Dividends paid per share | 0.42 | 0.42 | 0.485 | 0.485 | |||||||||||||
Market Price | |||||||||||||||||
High | 87.53 | 91.25 | 97.69 | 100.9 | |||||||||||||
Low | 73.51 | 85.25 | 89.17 | 91.04 | |||||||||||||
Year 2012 | First | Second | Third | Fourth | |||||||||||||
In thousands of dollars except per share amounts | |||||||||||||||||
Net sales | $ | 1,732,064 | $ | 1,414,444 | $ | 1,746,709 | $ | 1,751,035 | |||||||||
Gross profit | 743,396 | 618,521 | 742,757 | 755,208 | |||||||||||||
Net income | 198,651 | 135,685 | 176,716 | 149,879 | |||||||||||||
Class B Common Stock: | |||||||||||||||||
Net income per share—Basic | 0.82 | 0.56 | 0.73 | 0.62 | |||||||||||||
Net income per share—Diluted | 0.81 | 0.55 | 0.73 | 0.62 | |||||||||||||
Dividends paid per share | 0.344 | 0.344 | 0.344 | 0.38 | |||||||||||||
Common Stock: | |||||||||||||||||
Net income per share—Basic(a) | 0.91 | 0.62 | 0.8 | 0.69 | |||||||||||||
Net income per share—Diluted | 0.87 | 0.59 | 0.77 | 0.66 | |||||||||||||
Dividends paid per share | 0.38 | 0.38 | 0.38 | 0.42 | |||||||||||||
Market Price | |||||||||||||||||
High | 61.94 | 72.03 | 73.16 | 74.64 | |||||||||||||
Low | 59.49 | 59.81 | 70.09 | 68.85 | |||||||||||||
(a) | Quarterly income per share amounts do not total to the annual amount due to changes in weighted-average shares outstanding during the year. |
SCHEDULE_II_VALUATION_AND_QUAL
SCHEDULE II - VALUATION AND QUALIFYING ACCOUNTS | 12 Months Ended | ||||||||||||||||||||
Dec. 31, 2013 | |||||||||||||||||||||
Valuation and Qualifying Accounts [Abstract] | ' | ||||||||||||||||||||
Schedule of Valuation and Qualifying Accounts Disclosure | ' | ||||||||||||||||||||
THE HERSHEY COMPANY AND SUBSIDIARIES | |||||||||||||||||||||
SCHEDULE II—VALUATION AND QUALIFYING ACCOUNTS | |||||||||||||||||||||
For the Years Ended December 31, 2013, 2012 and 2011 | |||||||||||||||||||||
Additions | |||||||||||||||||||||
Description | Balance at | Charged to | Charged | Deductions | Balance | ||||||||||||||||
Beginning | Costs and | to Other Accounts | from | at End | |||||||||||||||||
of Period | Expenses | Reserves | of Period | ||||||||||||||||||
In thousands of dollars | |||||||||||||||||||||
Year Ended December 31, 2013: | |||||||||||||||||||||
Reserves deducted in the consolidated balance sheet from the assets to which they apply (a) | |||||||||||||||||||||
Accounts Receivable—Trade, Net | $ | 10,435 | $ | 154,092 | $ | — | $ | (154,283 | ) | $ | 10,244 | ||||||||||
Year Ended December 31, 2012: | |||||||||||||||||||||
Reserves deducted in the consolidated balance sheet from the assets to which they apply (a) | |||||||||||||||||||||
Accounts Receivable—Trade, Net | $ | 14,977 | $ | 134,972 | $ | — | $ | (139,514 | ) | $ | 10,435 | ||||||||||
Year Ended December 31, 2011: | |||||||||||||||||||||
Reserves deducted in the consolidated balance sheet from the assets to which they apply (a) | |||||||||||||||||||||
Accounts Receivable—Trade, Net | $ | 15,190 | $ | 135,147 | $ | — | $ | (135,360 | ) | $ | 14,977 | ||||||||||
(a) Includes allowances for doubtful accounts and anticipated discounts. |
SUMMARY_OF_SIGNIFICANT_ACCOUNT1
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 12 Months Ended | |
Dec. 31, 2013 | ||
Accounting Policies [Abstract] | ' | |
Principles of Consolidation | ' | |
Principles of Consolidation | ||
Our consolidated financial statements include the accounts of the Company and our majority-owned subsidiaries and entities in which we have a controlling financial interest after the elimination of intercompany accounts and transactions. We have a controlling financial interest if we own a majority of the outstanding voting common stock and minority shareholders do not have substantive participating rights, we have significant control over an entity through contractual or economic interests in which we are the primary beneficiary or we have the power to direct the activities that most significantly impact the entity's economic performance. For information on our noncontrolling interests see Note 4, Noncontrolling Interests in Subsidiaries. | ||
Equity Method Investments | ' | |
Equity Investments | ||
We use the equity method of accounting when we have a 20% to 50% interest in other companies and exercise significant influence. Under the equity method, original investments are recorded at cost and adjusted by our share of undistributed earnings or losses of these companies. Total equity investments were $39.9 million as of December 31, 2013, and $39.2 million as of December 31, 2012. Equity investments are included in other assets in the Consolidated Balance Sheets. Equity investments are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of the investments may not be recoverable. In May 2007, we entered into a manufacturing agreement in China with Lotte Confectionery Company, LTD. to produce Hershey products and certain Lotte products for the markets in Asia, particularly China. We own a 44% interest in this entity. We made loans to this affiliate of the Company of $16.0 million in 2013, $23.0 million in 2012 and $7.0 million in 2011 to finance the expansion of manufacturing capacity. | ||
Use of Estimates | ' | |
Use of Estimates | ||
The preparation of financial statements in conformity with U.S. generally accepted accounting principles (“GAAP”) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements, and revenues and expenses during the reporting period. Critical accounting estimates involved in applying our accounting policies are those that require management to make assumptions about matters that are highly uncertain at the time the accounting estimate was made and those for which different estimates reasonably could have been used for the current period. Critical accounting estimates are also those which are reasonably likely to change from period to period and would have a material impact on the presentation of our financial condition, changes in financial condition or results of operations. Our most critical accounting estimates pertain to accounting policies for accrued liabilities, pension and other post-retirement benefit plans, goodwill and other intangible assets, commodities futures and options contracts, and income taxes. | ||
These estimates and assumptions are based on management’s best judgment. Management evaluates its estimates and assumptions on an ongoing basis using historical experience and other factors, including the current economic environment, which management believes to be reasonable under the circumstances. We adjust such estimates and assumptions when facts and circumstances dictate. Volatile credit, equity, foreign currency, commodity and energy markets, and changing macroeconomic conditions have combined to increase the uncertainty inherent in such estimates and assumptions. As future events and their effects cannot be determined with precision, actual results could differ significantly from these estimates. Changes in these estimates resulting from continuing changes in the economic environment will be reflected in the financial statements in future periods. | ||
Revenue Recognition | ' | |
Revenue Recognition | ||
We record sales when all of the following criteria have been met: | ||
l | A valid customer order with a fixed price has been received; | |
l | The product has been delivered to the customer; | |
l | There is no further significant obligation to assist in the resale of the product; and | |
l | Collectability is reasonably assured. | |
Net sales include revenue from the sale of finished goods and royalty income, net of allowances for trade promotions, consumer coupon programs and other sales incentives, and allowances and discounts associated with aged or potentially unsaleable products. Trade promotions and sales incentives primarily include reduced price features, merchandising displays, sales growth incentives, new item allowances and cooperative advertising. | ||
Cost of Sales | ' | |
Cost of Sales | ||
Cost of sales represents costs directly related to the manufacture and distribution of our products. Primary costs include raw materials, packaging, direct labor, overhead, shipping and handling, warehousing and the depreciation of manufacturing, warehousing and distribution facilities. Manufacturing overhead and related expenses include salaries, wages, employee benefits, utilities, maintenance and property taxes. | ||
Selling, General and Administrative Expenses | ' | |
Selling, Marketing and Administrative | ||
Selling, marketing and administrative expenses represent costs incurred in generating revenues and in managing our business. Such costs include advertising and other marketing expenses, salaries, employee benefits, incentive compensation, research and development, travel, office expenses, amortization of capitalized software and depreciation of administrative facilities. | ||
Cash Equivalents | ' | |
Cash Equivalents | ||
Cash equivalents consist of highly liquid debt instruments, time deposits and money market funds with original maturities of 3 months or less. The fair value of cash and cash equivalents approximates the carrying amount. | ||
Derivative Contracts | ' | |
Interest Rate Swaps | ||
In order to manage interest rate exposure, from time to time, we enter into interest rate swap agreements. Interest rate swap agreements are designated as cash flow hedging derivatives and the fair value of such agreements is recorded on the Consolidated Balance Sheets as either an asset or a liability. Additional information with regard to accounting policies associated with derivative instruments is contained in Note 6, Derivative Instruments and Hedging Activities. | ||
Commodities Futures and Options Contracts | ||
We enter into commodities futures and options contracts and other commodity derivative instruments to reduce the effect of price fluctuations associated with the purchase of raw materials, energy requirements and transportation services. We report the effective portion of the gain or loss on a derivative instrument designated and qualifying as a cash flow hedging instrument as a component of other comprehensive income and reclassify such gains or losses into earnings in the same period or periods during which the hedged transactions affect earnings. The remaining gain or loss on the derivative instrument, if any, must be recognized currently in earnings. | ||
For a derivative designated as hedging the exposure to changes in the fair value of a recognized asset or liability or a firm commitment (referred to as a fair value hedge), the gain or loss must be recognized in earnings in the period of change together with the offsetting loss or gain on the hedged item attributable to the risk being hedged. The effect of that accounting is to reflect in earnings the extent to which the hedge is not effective in achieving offsetting changes in fair value. | ||
All derivative instruments which we are currently utilizing are designated and accounted for as cash flow hedges, except for out of the money options contracts on certain commodities. These include commodities futures and options contracts and other commodity derivative instruments. Additional information with regard to accounting policies associated with derivative instruments is contained in Note 6, Derivative Instruments and Hedging Activities. | ||
Property, Plant and Equipment | ' | |
Property, Plant and Equipment | ||
Property, plant and equipment are stated at cost and depreciated on a straight-line basis over the estimated useful lives of the assets, as follows: 3 to 15 years for machinery and equipment; and 25 to 40 years for buildings and related improvements. Maintenance and repairs are expensed as incurred. We capitalize applicable interest charges incurred during the construction of new facilities and production lines and amortize these costs over the assets’ estimated useful lives. | ||
We review long-lived assets for impairment whenever events or changes in circumstances indicate that the carrying amount of such assets may not be recoverable. We measure the recoverability of assets to be held and used by a comparison of the carrying amount of long-lived assets to future undiscounted net cash flows expected to be generated. If these assets are considered to be impaired, we measure impairment as the amount by which the carrying amount of the assets exceeds the fair value of the assets. We report assets held for sale or disposal at the lower of the carrying amount or fair value less cost to sell. | ||
Asset Retirement Obligations | ' | |
Asset Retirement Obligations | ||
Asset retirement obligations generally apply to legal obligations associated with the retirement of a tangible long-lived asset that result from the acquisition, construction or development and normal operation of a long-lived asset. We assess asset retirement obligations on a periodic basis. We recognize the fair value of a liability for an asset retirement obligation in the period in which it is incurred if a reasonable estimate of fair value can be made. We capitalize associated asset retirement costs as part of the carrying amount of the long-lived asset. | ||
Goodwill and Intangible Assets | ' | |
Goodwill and Other Intangible Assets | ||
We classify intangible assets into 3 categories: (1) intangible assets with finite lives subject to amortization; (2) intangible assets with indefinite lives not subject to amortization; and (3) goodwill. | ||
Our intangible assets with finite lives consist primarily of certain trademarks, customer-related intangible assets and patents obtained through business acquisitions. We are amortizing trademarks with finite lives over their estimated useful lives of approximately 25 years. We are amortizing customer-related intangible assets over their estimated useful lives of approximately 15 years. We are amortizing patents over their remaining legal lives of approximately 5 years. We conduct impairment tests when events or changes in circumstances indicate that the carrying value of these assets may not be recoverable. Undiscounted cash flow analyses are used to determine if an impairment exists. If an impairment is determined to exist, the loss is calculated based on the estimated fair value of the assets. | ||
Our intangible assets with indefinite lives consist of trademarks obtained through business acquisitions. We do not amortize existing trademarks whose useful lives were determined to be indefinite. We conduct impairment tests for other intangible assets with indefinite lives and goodwill at the beginning of the fourth quarter of each year, or when circumstances arise that indicate a possible impairment might exist. | ||
We evaluate our trademarks with indefinite lives for impairment by comparing their carrying amount to their estimated fair value. The fair value of trademarks is calculated using a “relief from royalty payments” methodology. This approach involves a two-step process. In the first step, we estimate reasonable royalty rates for each trademark. In the second step, we apply these royalty rates to a net sales stream and discount the resulting cash flows to determine fair value. This fair value is then compared with the carrying value of each trademark. If the estimated fair value is less than the carrying amount, we record an impairment charge to reduce the asset to its estimated fair value. The estimates of future cash flows are generally based on past performance of the brands and reflect net sales projections and assumptions for the brands that we use in current operating plans. We also consider assumptions that market participants may use. Such assumptions are subject to change due to changing economic and competitive conditions. | ||
We use a two-step process to evaluate goodwill for impairment. In the first step, we compare the fair value of each reporting unit with the carrying amount of the reporting unit, including goodwill. We estimate the fair value of the reporting unit based on discounted future cash flows. If the estimated fair value of the reporting unit is less than the carrying amount of the reporting unit, we complete a second step to determine the amount of the goodwill impairment that we should record. In the second step, we determine an implied fair value of the reporting unit’s goodwill by allocating the reporting unit’s fair value to all of its assets and liabilities other than goodwill (including any unrecognized intangible assets). We compare the resulting implied fair value of the goodwill to the carrying amount and record an impairment charge for the difference. | ||
The assumptions we use to estimate fair value are based on the past performance of each reporting unit and reflect the projections and assumptions that we use in current operating plans. We also adjust the assumptions, if necessary, to estimates that we believe market participants would use. Such assumptions are subject to change due to changing economic and competitive conditions. | ||
We provide more information on intangible assets in Note 18, Supplemental Balance Sheet Information. | ||
Comprehensive Income | ' | |
Comprehensive Income | ||
We report comprehensive income (loss) on the Consolidated Statements of Comprehensive Income and accumulated other comprehensive income (loss) on the Consolidated Balance Sheets. Additional information regarding comprehensive income is contained in Note 9, Comprehensive Income. | ||
We translate results of operations for foreign entities using the average exchange rates during the period. For foreign entities, assets and liabilities are translated to U.S. dollars using the exchange rates in effect at the balance sheet date. Resulting translation adjustments are recorded as a component of other comprehensive income (loss), “Foreign Currency Translation Adjustments.” | ||
Changes to the balances of the unrecognized prior service cost and the unrecognized net actuarial loss, net of income taxes, associated with our pension and post-retirement benefit plans are recorded as a component of other comprehensive income (loss), “Pension and Post-retirement Benefit Plans.” Additional information regarding accounting policies associated with benefit plans is contained in Note 14, Pension and Other Post-Retirement Benefit Plans. | ||
Gains and losses on cash flow hedging derivatives, to the extent effective, are included in other comprehensive income (loss), net of related tax effects. Reclassification adjustments reflecting such gains and losses are recorded in income in the same period during which the hedged transactions affect earnings. Additional information with regard to accounting policies associated with derivative instruments is contained in Note 6, Derivative Instruments and Hedging Activities. | ||
Foreign Exchange Forward Contracts and Options | 'Foreign Exchange Forward Contracts and OptionsWe enter into foreign exchange forward contracts and options to hedge transactions denominated in foreign currencies. These transactions are primarily related to firm commitments or forecasted purchases associated with the construction of a manufacturing facility, equipment, certain raw materials and finished goods. We also hedge payment of forecasted intercompany transactions with our subsidiaries outside of the United States. These contracts reduce currency risk from exchange rate movements. Foreign exchange forward contracts and options are designated as cash flow hedging derivatives and the fair value of such contracts is recorded on the Consolidated Balance Sheets as either an asset or a liability. Additional information with regard to accounting policies for derivative instruments, including foreign exchange forward contracts and options, is contained in Note 6, Derivative Instruments and Hedging Activities. | |
License Agreements | ' | |
License Agreements | ||
We own various registered and unregistered trademarks and service marks, and have rights under licenses to use various trademarks that are of material importance to our business. We also grant trademark licenses to third parties to produce and sell pantry items, flavored milks and various other products primarily under the HERSHEY’S and REESE’S brand names. | ||
Research and Development | ' | |
Research and Development | ||
We expense research and development costs as incurred. Research and development expense was $47.6 million in 2013, $39.0 million in 2012 and $33.2 million in 2011. The increase in research and development expenses in 2013 was primarily related to the Asia Innovation Center which opened in May 2013. Research and development expense is included in selling, marketing and administrative expenses | ||
Advertising | ' | |
Advertising | ||
We expense advertising costs as incurred. Advertising expense, which is included in selling, marketing and administrative expenses, was $582.4 million in 2013, $480.0 million in 2012 and $414.2 million in 2011. Prepaid advertising expense as of December 31, 2013 was $8.4 million and as of December 31, 2012 was $9.5 million. | ||
Computer Software | ' | |
Computer Software | ||
We capitalize costs associated with software developed or obtained for internal use when both the preliminary project stage is completed and it is probable that computer software being developed will be completed and placed in service. Capitalized costs include only (i) external direct costs of materials and services consumed in developing or obtaining internal-use software, (ii) payroll and other related costs for employees who are directly associated with and who devote time to the internal-use software project and (iii) interest costs incurred, when material, while developing internal-use software. We cease capitalization of such costs no later than the point at which the project is substantially complete and ready for its intended purpose. | ||
The unamortized amount of capitalized software was $56.5 million as of December 31, 2013 and was $50.5 million as of December 31, 2012. We amortize software costs using the straight-line method over the expected life of the software, generally 3 to 5 years. Accumulated amortization of capitalized software was $277.9 million as of December 31, 2013 and $256.1 million as of December 31, 2012. | ||
We review the carrying value of software and development costs for impairment in accordance with our policy pertaining to the impairment of long-lived assets. Generally, we measure impairment under the following circumstances: | ||
l | When internal-use computer software is not expected to provide substantive service potential; | |
l | A significant change occurs in the extent or manner in which the software is used or is expected to be used; | |
l | A significant change is made or will be made to the software program; and | |
l | Costs of developing or modifying internal-use computer software significantly exceed the amount originally expected to develop or modify the software. | |
Recent Accounting Pronouncements | ' | |
Recent Accounting Pronouncements | ||
In July 2013, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update No. 2013-11–Income Taxes (Topic 740): Presentation of an Unrecognized Tax Benefit When a Net Operating Loss Carryforward, a Similar Tax Loss, or a Tax Credit Carryforward Exists (a consensus of the FASB Emerging Issues Task Force) (“ASU No. 2013-11”). ASU No. 2013-11 provides guidance on the financial statement presentation of an unrecognized tax benefit when a net operating loss carryforward, a similar tax loss, or a tax credit carryforward exists. ASU No. 2013-11 is effective for fiscal years, and interim periods within those years, beginning after December 15, 2013. The adoption of ASU No. 2013-11 will not have a significant impact on our consolidated financial statements. |
BUSINESS_ACQUISITIONS_AND_DIVE1
BUSINESS ACQUISITIONS AND DIVESTITURES (Tables) | 12 Months Ended | |||||||
Dec. 31, 2013 | ||||||||
Business Combinations [Abstract] | ' | |||||||
Schedule of Business Acquisitions, Purchase Price Allocation | ' | |||||||
The purchase price allocation of the Brookside acquisition is as follows: | ||||||||
In thousands of dollars | Purchase Price | Estimated | ||||||
Allocation | Useful Life | |||||||
in Years | ||||||||
Goodwill | $ | 67,974 | Indefinite | |||||
Trademarks | 60,253 | 25 | ||||||
Other intangibles(1) | 51,057 | 6 | to | 17 | ||||
Other assets, net of liabilities assumed of $18.7 million | 21,673 | |||||||
Non-current deferred tax liabilities | (28,101 | ) | ||||||
Purchase price | $ | 172,856 | ||||||
(1) Includes customer relationships, patents and covenants not to compete. |
BUSINESS_REALIGNMENT_AND_IMPAI1
BUSINESS REALIGNMENT AND IMPAIRMENT CHARGES (Tables) | 12 Months Ended | ||||||||||||
Dec. 31, 2013 | |||||||||||||
Restructuring and Related Activities [Abstract] | ' | ||||||||||||
Business Realignment And Impairment Charges | ' | ||||||||||||
. | |||||||||||||
Charges (credits) associated with business realignment initiatives and impairment recorded during 2013, 2012 and 2011 were as follows: | |||||||||||||
For the years ended December 31, | 2013 | 2012 | 2011 | ||||||||||
In thousands of dollars | |||||||||||||
Cost of sales | |||||||||||||
Next Century program | $ | 402 | $ | 36,383 | $ | 39,280 | |||||||
Global supply chain transformation program | — | — | 5,816 | ||||||||||
Total cost of sales | 402 | 36,383 | 45,096 | ||||||||||
Selling, marketing and administrative - Next Century program | 18 | 2,446 | 4,961 | ||||||||||
Business realignment and impairment charges, net | |||||||||||||
Next Century program: | |||||||||||||
Pension settlement loss | — | 15,787 | — | ||||||||||
Plant closure expenses | 16,387 | 20,780 | 8,620 | ||||||||||
Employee separation costs (credits) | — | 914 | (9,506 | ) | |||||||||
India voluntary retirement program | 2,278 | — | — | ||||||||||
Tri-US, Inc. asset impairment charges | — | 7,457 | — | ||||||||||
Total business realignment and impairment charges (credits), net | 18,665 | 44,938 | (886 | ) | |||||||||
Total net charges associated with business realignment initiatives and impairment | $ | 19,085 | $ | 83,767 | $ | 49,171 | |||||||
COMMITMENTS_AND_CONTINGENCIES_
COMMITMENTS AND CONTINGENCIES (Tables) | 12 Months Ended | ||||||||||||||||||
Dec. 31, 2013 | |||||||||||||||||||
Commitments and Contingencies Disclosure [Abstract] | ' | ||||||||||||||||||
Purchase Obligations Covered by Purchase Agreements with Various Suppliers | ' | ||||||||||||||||||
As of December 31, 2013, we had entered into purchase agreements with various suppliers. Subject to meeting our quality standards, the purchase obligations covered by these agreements were as follows as of December 31, 2013: | |||||||||||||||||||
Purchase Obligations | 2014 | 2015 | 2016 | 2017 | |||||||||||||||
In millions of dollars | |||||||||||||||||||
Purchase obligations | $ | 1,381.60 | $ | 651.9 | $ | 48.3 | $ | 6.4 | |||||||||||
Future Minimum Payments under Non-Cancelable Operating Leases | ' | ||||||||||||||||||
We have commitments under various lease obligations. Future minimum payments under lease obligations with a remaining term in excess of one year were as follows as of December 31, 2013: | |||||||||||||||||||
Lease Obligations | 2014 | 2015 | 2016 | 2017 | 2018 | Thereafter | |||||||||||||
In millions of dollars | |||||||||||||||||||
Future minimum rental payments | $ | 36.7 | $ | 11.5 | $ | 10.8 | $ | 7.6 | $ | 2.2 | $ | 1.6 | |||||||
DERIVATIVE_INSTRUMENTS_AND_HED1
DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES (Tables) | 12 Months Ended | ||||||||||||
Dec. 31, 2013 | |||||||||||||
Derivative Instruments and Hedging Activities Disclosure [Abstract] | ' | ||||||||||||
The fair value of derivative instruments | ' | ||||||||||||
The fair value of derivative instruments in the Consolidated Balance Sheet as of December 31, 2013 was as follows: | |||||||||||||
Balance Sheet Caption | Interest Rate Swap | Foreign | Commodities Futures and Options Contracts | ||||||||||
Agreements | Exchange | ||||||||||||
Forward | |||||||||||||
Contracts | |||||||||||||
and Options | |||||||||||||
In thousands of dollars | |||||||||||||
Prepaid expense and other current assets | $ | — | $ | 2,672 | $ | 4,306 | |||||||
Other assets | $ | 22,745 | $ | 751 | $ | — | |||||||
Accrued liabilities | $ | — | $ | — | $ | 129 | |||||||
Other long-term liabilities | $ | — | $ | 198 | $ | — | |||||||
The fair value of derivative instruments in the Consolidated Balance Sheet as of December 31, 2012 was as follows: | |||||||||||||
Balance Sheet Caption | Interest Rate Swap | Foreign | Commodities Futures and Options Contracts | ||||||||||
Agreements | Exchange | ||||||||||||
Forward | |||||||||||||
Contracts | |||||||||||||
and Options | |||||||||||||
In thousands of dollars | |||||||||||||
Prepaid expense and other current assets | $ | — | $ | 2,119 | $ | — | |||||||
Accrued liabilities | $ | 12,502 | $ | 917 | $ | 2,010 | |||||||
Other long-term liabilities | $ | 922 | $ | — | $ | — | |||||||
Effect of derivatives instruments on the Consolidated Statements of Income | ' | ||||||||||||
The effect of derivative instruments on the Consolidated Statements of Income for the year ended December 31, 2013 was as follows: | |||||||||||||
Cash Flow Hedging Derivatives | Interest Rate | Foreign Exchange | Commodities | ||||||||||
Swap | Forward | Futures and | |||||||||||
Agreements | Contracts | Options | |||||||||||
and Options | Contracts | ||||||||||||
In thousands of dollars | |||||||||||||
Gains (losses) recognized in other comprehensive income (“OCI”) (effective portion) | $ | 27,534 | $ | 4,049 | $ | 84,746 | |||||||
Gains (losses) reclassified from accumulated OCI into income (effective portion) (a) | $ | (3,606 | ) | $ | 2,641 | $ | (8,400 | ) | |||||
Gains recognized in income (ineffective portion) (b) | $ | — | $ | — | $ | 3,241 | |||||||
The effect of derivative instruments on the Consolidated Statements of Income for the year ended December 31, 2012 was as follows: | |||||||||||||
Cash Flow Hedging Derivatives | Interest Rate | Foreign Exchange | Commodities | ||||||||||
Swap | Forward | Futures and | |||||||||||
Agreements | Contracts | Options | |||||||||||
and Options | Contracts | ||||||||||||
In thousands of dollars | |||||||||||||
Gains (losses) recognized in other comprehensive income (“OCI”) (effective portion) | $ | (13,424 | ) | $ | 47 | $ | 12,834 | ||||||
Gains (losses) reclassified from accumulated OCI into income (effective portion) (a) | $ | (3,605 | ) | $ | (2,488 | ) | $ | (90,900 | ) | ||||
Gains recognized in income (ineffective portion) (b) | $ | — | $ | — | $ | 670 | |||||||
FINANCIAL_INSTRUMENTS_Tables
FINANCIAL INSTRUMENTS (Tables) | 12 Months Ended | ||||||||||||
Dec. 31, 2013 | |||||||||||||
Financial Instruments Disclosure [Abstract] | ' | ||||||||||||
Schedule Of Foreign Exchange Forward Contracts | ' | ||||||||||||
: | |||||||||||||
December 31, | 2013 | 2012 | |||||||||||
Contract | Primary | Contract | Primary | ||||||||||
Amount | Currencies | Amount | Currencies | ||||||||||
In millions of dollars | |||||||||||||
Foreign exchange forward contracts to purchase foreign currencies | $ | 158.4 | Malaysian ringgits | $ | 17.1 | Euros | |||||||
Swiss francs | British pound sterling | ||||||||||||
Euros | |||||||||||||
Foreign exchange forward contracts to sell foreign currencies | $ | 2.8 | Japanese Yen | $ | 57.8 | Canadian dollars | |||||||
Fair Value, by Balance Sheet Grouping | ' | ||||||||||||
The combined fair value of our foreign exchange forward contracts included in prepaid expenses and other current assets, other non-current assets, accrued liabilities or other long-term liabilities on the Consolidated Balance Sheets was as follows: | |||||||||||||
December 31, | 2013 | 2012 | |||||||||||
In millions of dollars | |||||||||||||
Fair value of foreign exchange forward contracts, net — asset | $ | 3.2 | $ | 1.2 | |||||||||
FAIR_VALUE_ACCOUNTING_Tables
FAIR VALUE ACCOUNTING (Tables) | 12 Months Ended | ||||||||||||||||
Dec. 31, 2013 | |||||||||||||||||
Fair Value Disclosures [Abstract] | ' | ||||||||||||||||
Cash Flow Hedging Derivative Assets and Liabilities | ' | ||||||||||||||||
A summary of our derivative assets and liabilities measured at fair value on a recurring basis as of December 31, 2013, is as follows: | |||||||||||||||||
Description | Fair Value as of December 31, 2013 | Quoted Prices in | Significant | Significant Unobservable Inputs | |||||||||||||
Active Markets | Other | (Level 3) | |||||||||||||||
of Identical | Observable | ||||||||||||||||
Assets (Level 1) | Inputs (Level 2) | ||||||||||||||||
In thousands of dollars | |||||||||||||||||
Derivative assets | $ | 54,254 | $ | 28,086 | $ | 26,168 | $ | — | |||||||||
Derivative liabilities | $ | 24,107 | $ | 23,909 | $ | 198 | $ | — | |||||||||
As of December 31, 2013, Level 1 derivative assets were related to the fair value of options contracts for certain commodities and cash transfers receivable on commodities futures contracts with gains resulting from the change in quoted market prices on the last trading day for the period. As of December 31, 2013, Level 1 derivative liabilities were related to cash transfers payable on commodities futures contracts with losses resulting from the change in quoted market prices on the last trading day for the period. | |||||||||||||||||
As of December 31, 2013, Level 2 derivative assets were related to the fair value of interest rate swap agreements and foreign exchange forward contracts and options with gains. Level 2 derivative liabilities were related to the fair value of foreign exchange forward contracts and options with losses. The fair value of the interest rate swap agreements represents the difference in the present values of cash flows calculated at the contracted interest rates and at current market interest rates at the end of the period. We calculate the fair value of interest rate swap agreements quarterly based on inputs derived from observable market data. The fair value of foreign exchange forward contracts and options is the amount of the difference between the contracted and current market foreign currency exchange rates at the end of the period. We estimate the fair value of foreign exchange forward contracts and options on a quarterly basis by obtaining market quotes of spot and forward rates for contracts with similar terms, adjusted where necessary for maturity differences. | |||||||||||||||||
A summary of our derivative assets and liabilities measured at fair value on a recurring basis as of December 31, 2012, is as follows: | |||||||||||||||||
Description | Fair Value as of December 31, 2012 | Quoted Prices in | Significant | Significant Unobservable Inputs | |||||||||||||
Active Markets | Other | (Level 3) | |||||||||||||||
of Identical | Observable | ||||||||||||||||
Assets (Level 1) | Inputs (Level 2) | ||||||||||||||||
In thousands of dollars | |||||||||||||||||
Derivative assets | $ | 39,175 | $ | 37,056 | $ | 2,119 | $ | — | |||||||||
Derivative liabilities | $ | 53,407 | $ | 39,066 | $ | 14,341 | $ | — | |||||||||
As of December 31, 2012, Level 1 derivative assets were related to cash transfers receivable on commodities futures contracts with gains resulting from the change in quoted market prices on the last trading day for the period. As of December 31, 2012, Level 1 derivative liabilities were related to cash transfers payable on commodities futures contracts with losses resulting from the change in quoted market prices on the last trading day for the period. | |||||||||||||||||
As of December 31, 2012, Level 2 derivative assets were related to the fair value of foreign exchange forward contracts and options with gains. Level 2 derivative liabilities were related to the fair value of interest rate swap agreements and foreign exchange forward contracts and options with losses. |
COMPREHENSIVE_INCOME_Tables
COMPREHENSIVE INCOME (Tables) | 12 Months Ended | ||||||||||||
Dec. 31, 2013 | |||||||||||||
Comprehensive Income Disclosure [Abstract] | ' | ||||||||||||
Comprehensive Income (Loss) | ' | ||||||||||||
A summary of the components of comprehensive income is as follows: | |||||||||||||
For the year ended December 31, 2013 | Pre-Tax | Tax | After-Tax | ||||||||||
Amount | (Expense) | Amount | |||||||||||
Benefit | |||||||||||||
In thousands of dollars | |||||||||||||
Net income | $ | 820,470 | |||||||||||
Other comprehensive income (loss): | |||||||||||||
Foreign currency translation adjustments | $ | (26,003 | ) | $ | — | (26,003 | ) | ||||||
Pension and post-retirement benefit plans | 265,015 | (98,612 | ) | 166,403 | |||||||||
Cash flow hedges: | |||||||||||||
Gains on cash flow hedging derivatives | 116,329 | (43,995 | ) | 72,334 | |||||||||
Reclassification adjustments | 9,365 | (3,590 | ) | 5,775 | |||||||||
Total other comprehensive income | $ | 364,706 | $ | (146,197 | ) | 218,509 | |||||||
Comprehensive income | $ | 1,038,979 | |||||||||||
For the year ended December 31, 2012 | Pre-Tax | Tax | After-Tax | ||||||||||
Amount | (Expense) | Amount | |||||||||||
Benefit | |||||||||||||
In thousands of dollars | |||||||||||||
Net income | $ | 660,931 | |||||||||||
Other comprehensive income (loss): | |||||||||||||
Foreign currency translation adjustments | $ | 7,714 | $ | — | 7,714 | ||||||||
Pension and post-retirement benefit plans | (15,159 | ) | 5,525 | (9,634 | ) | ||||||||
Cash flow hedges: | |||||||||||||
Losses on cash flow hedging derivatives | (543 | ) | (325 | ) | (868 | ) | |||||||
Reclassification adjustments | 96,993 | (36,950 | ) | 60,043 | |||||||||
Total other comprehensive income | $ | 89,005 | $ | (31,750 | ) | 57,255 | |||||||
Comprehensive income | $ | 718,186 | |||||||||||
For the year ended December 31, 2011 | Pre-Tax | Tax | After-Tax | ||||||||||
Amount | (Expense) | Amount | |||||||||||
Benefit | |||||||||||||
In thousands of dollars | |||||||||||||
Net income | $ | 628,962 | |||||||||||
Other comprehensive income (loss): | |||||||||||||
Foreign currency translation adjustments | $ | (21,213 | ) | $ | — | (21,213 | ) | ||||||
Pension and post-retirement benefit plans | (137,918 | ) | 52,095 | (85,823 | ) | ||||||||
Cash flow hedges: | |||||||||||||
Losses on cash flow hedging derivatives | (175,011 | ) | 67,298 | (107,713 | ) | ||||||||
Reclassification adjustments | (20,282 | ) | 7,767 | (12,515 | ) | ||||||||
Total other comprehensive loss | $ | (354,424 | ) | $ | 127,160 | (227,264 | ) | ||||||
Comprehensive income | $ | 401,698 | |||||||||||
Components of Accumulated Other Comprehensive Income (Loss) | ' | ||||||||||||
The components of accumulated other comprehensive loss, as shown on the Consolidated Balance Sheets, are as follows: | |||||||||||||
December 31, | 2013 | 2012 | |||||||||||
In thousands of dollars | |||||||||||||
Foreign currency translation adjustments | $ | (16,830 | ) | $ | 9,173 | ||||||||
Pension and post-retirement benefit plans, net of tax | (199,634 | ) | (366,037 | ) | |||||||||
Cash flow hedges, net of tax | 49,897 | (28,212 | ) | ||||||||||
Total accumulated other comprehensive loss | $ | (166,567 | ) | $ | (385,076 | ) |
INTEREST_EXPENSE_Tables
INTEREST EXPENSE (Tables) | 12 Months Ended | ||||||||||||
Dec. 31, 2013 | |||||||||||||
Interest Expense [Abstract] | ' | ||||||||||||
Net Interest Expense | ' | ||||||||||||
Net interest expense consisted of the following: | |||||||||||||
For the years ended December 31, | 2013 | 2012 | 2011 | ||||||||||
In thousands of dollars | |||||||||||||
Long-term debt and lease obligations | $ | 84,604 | $ | 81,203 | $ | 85,543 | |||||||
Short-term debt | 8,654 | 23,084 | 17,051 | ||||||||||
Capitalized interest | (1,744 | ) | (5,778 | ) | (7,814 | ) | |||||||
Interest expense, gross | 91,514 | 98,509 | 94,780 | ||||||||||
Interest income | (3,158 | ) | (2,940 | ) | (2,597 | ) | |||||||
Interest expense, net | $ | 88,356 | $ | 95,569 | $ | 92,183 | |||||||
LONGTERM_DEBT_Tables
LONG-TERM DEBT (Tables) | 12 Months Ended | ||||||||
Dec. 31, 2013 | |||||||||
Maturities of Long-term Debt [Abstract] | ' | ||||||||
Long-term Debt | ' | ||||||||
Long-term debt consisted of the following: | |||||||||
December 31, | 2013 | 2012 | |||||||
In thousands of dollars | |||||||||
5.00% Notes due 2013 | $ | — | $ | 250,000 | |||||
4.85% Notes due 2015 | 250,000 | 250,000 | |||||||
5.45% Notes due 2016 | 250,000 | 250,000 | |||||||
1.50% Notes due 2016 | 250,000 | 250,000 | |||||||
4.125% Notes due 2020 | 350,000 | 350,000 | |||||||
8.8% Debentures due 2021 | 100,000 | 100,000 | |||||||
2.625% Notes due 2023 | 250,000 | — | |||||||
7.2% Debentures due 2027 | 250,000 | 250,000 | |||||||
Other obligations, net of unamortized debt discount | 96,056 | 88,701 | |||||||
Total long-term debt | 1,796,056 | 1,788,701 | |||||||
Less—current portion | 914 | 257,734 | |||||||
Long-term portion | $ | 1,795,142 | $ | 1,530,967 | |||||
Maturities of Long-term Debt | ' | ||||||||
Aggregate annual maturities during the next five years are as follows: | |||||||||
l | 2014 | — | $0.9 million | ||||||
l | 2015 | — | $251.4 million | ||||||
l | 2016 | — | $501.3 million | ||||||
l | 2017 | — | $0.9 million | ||||||
l | 2018 | — | $0.4 million |
INCOME_TAXES_INCOME_TAXES_Tabl
INCOME TAXES INCOME TAXES (Tables) | 12 Months Ended | ||||||||||||
Dec. 31, 2013 | |||||||||||||
Income Tax Disclosure [Abstract] | ' | ||||||||||||
Schedule of Income/(Loss) before Income Taxes | ' | ||||||||||||
For the years ended December 31, | 2013 | 2012 | 2011 | ||||||||||
In thousands of dollars | |||||||||||||
Domestic | $ | 1,252,208 | $ | 980,176 | $ | 904,418 | |||||||
Foreign | (889 | ) | 35,403 | 58,427 | |||||||||
Income before income taxes | $ | 1,251,319 | $ | 1,015,579 | $ | 962,845 | |||||||
Schedule of Components of Income Tax Expense (Benefit) | ' | ||||||||||||
For the years ended December 31, | 2013 | 2012 | 2011 | ||||||||||
In thousands of dollars | |||||||||||||
Current: | |||||||||||||
Federal | $ | 372,649 | $ | 299,122 | $ | 254,732 | |||||||
State | 47,980 | 36,187 | 32,174 | ||||||||||
Foreign | 2,763 | 5,554 | 13,366 | ||||||||||
Current provision for income taxes | 423,392 | 340,863 | 300,272 | ||||||||||
Deferred: | |||||||||||||
Federal | 11,334 | 5,174 | 37,160 | ||||||||||
State | 2,212 | 1,897 | (1,005 | ) | |||||||||
Foreign | (6,089 | ) | 6,714 | (2,544 | ) | ||||||||
Deferred income tax provision | 7,457 | 13,785 | 33,611 | ||||||||||
Total provision for income taxes | $ | 430,849 | $ | 354,648 | $ | 333,883 | |||||||
Schedule of Deferred Tax Asset and Liabilities | ' | ||||||||||||
December 31, | 2013 | 2012 | |||||||||||
In thousands of dollars | |||||||||||||
Deferred tax assets: | |||||||||||||
Post-retirement benefit obligations | $ | 101,674 | $ | 119,140 | |||||||||
Accrued expenses and other reserves | 119,387 | 112,760 | |||||||||||
Stock-based compensation | 47,324 | 51,388 | |||||||||||
Derivative instruments | — | 23,822 | |||||||||||
Pension | — | 72,374 | |||||||||||
Lease financing obligation | 19,065 | 19,035 | |||||||||||
Accrued trade promotion reserves | 39,234 | 30,594 | |||||||||||
Net operating loss carryforwards | 39,606 | 48,455 | |||||||||||
Other | 11,754 | 3,643 | |||||||||||
Gross deferred tax assets | 378,044 | 481,211 | |||||||||||
Valuation allowance | (87,159 | ) | (74,021 | ) | |||||||||
Total deferred tax assets | 290,885 | 407,190 | |||||||||||
Deferred tax liabilities: | |||||||||||||
Property, plant and equipment, net | 201,224 | 210,406 | |||||||||||
Acquired intangibles | 64,249 | 63,585 | |||||||||||
Inventories | 33,885 | 23,335 | |||||||||||
Derivative instruments | 33,779 | — | |||||||||||
Pension | 8,037 | — | |||||||||||
Other | 1,404 | 10,849 | |||||||||||
Total deferred tax liabilities | 342,578 | 308,175 | |||||||||||
Net deferred tax (liabilities) assets | $ | (51,693 | ) | $ | 99,015 | ||||||||
Included in: | |||||||||||||
Current deferred tax assets, net | $ | 52,511 | $ | 122,224 | |||||||||
Non-current deferred tax assets, net | — | 12,448 | |||||||||||
Non-current deferred tax liabilities, net | (104,204 | ) | (35,657 | ) | |||||||||
Net deferred tax (liabilities) assets | $ | (51,693 | ) | $ | 99,015 | ||||||||
Schedule of Effective Income Tax Rate Reconciliation | ' | ||||||||||||
For the years ended December 31, | 2013 | 2012 | 2011 | ||||||||||
Federal statutory income tax rate | 35 | % | 35 | % | 35 | % | |||||||
Increase (reduction) resulting from: | |||||||||||||
State income taxes, net of Federal income tax benefits | 2.8 | 3.2 | 2.4 | ||||||||||
Qualified production income deduction | (2.6 | ) | (2.5 | ) | (2.2 | ) | |||||||
Business realignment and impairment charges and gain on sale of trademark licensing rights | 0.1 | 0.2 | (0.1 | ) | |||||||||
International operations | (0.4 | ) | (0.1 | ) | (0.6 | ) | |||||||
Other, net | (0.5 | ) | (0.9 | ) | 0.2 | ||||||||
Effective income tax rate | 34.4 | % | 34.9 | % | 34.7 | % | |||||||
Schedule of Unrecognized Tax Benefits Roll Forward | ' | ||||||||||||
December 31, | 2013 | 2012 | |||||||||||
In thousands of dollars | |||||||||||||
Balance at beginning of year | $ | 51,520 | $ | 53,553 | |||||||||
Additions for tax positions taken during prior years | 58,246 | 11,335 | |||||||||||
Reductions for tax positions taken during prior years | (5,776 | ) | (5,478 | ) | |||||||||
Additions for tax positions taken during the current year | 5,523 | 5,750 | |||||||||||
Settlements | — | (5,234 | ) | ||||||||||
Expiration of statutes of limitations | (5,550 | ) | (8,406 | ) | |||||||||
Balance at end of year | $ | 103,963 | $ | 51,520 | |||||||||
PENSION_AND_OTHER_POSTRETIREME1
PENSION AND OTHER POST-RETIREMENT BENEFIT PLANS (Tables) | 12 Months Ended | ||||||||||||||||||||||||
Dec. 31, 2013 | |||||||||||||||||||||||||
Compensation and Retirement Disclosure [Abstract] | ' | ||||||||||||||||||||||||
Schedule of Defined Benefit Plans | ' | ||||||||||||||||||||||||
A summary of the changes in benefit obligations and plan assets is as follows: | |||||||||||||||||||||||||
Pension Benefits | Other Benefits | ||||||||||||||||||||||||
December 31, | 2013 | 2012 | 2013 | 2012 | |||||||||||||||||||||
In thousands of dollars | |||||||||||||||||||||||||
Change in benefit obligation | |||||||||||||||||||||||||
Projected benefits obligation at beginning of year | $ | 1,237,778 | $ | 1,156,756 | $ | 318,415 | $ | 318,536 | |||||||||||||||||
Service cost | 31,339 | 30,823 | 1,094 | 1,172 | |||||||||||||||||||||
Interest cost | 43,962 | 49,909 | 10,747 | 13,258 | |||||||||||||||||||||
Plan amendments | 55 | 2 | — | — | |||||||||||||||||||||
Actuarial (gain) loss | (100,872 | ) | 112,700 | (33,412 | ) | 7,916 | |||||||||||||||||||
Curtailment | (8,833 | ) | — | — | — | ||||||||||||||||||||
Settlement | (319 | ) | (49,876 | ) | — | — | |||||||||||||||||||
Currency translation and other | (5,976 | ) | 1,903 | (1,030 | ) | 370 | |||||||||||||||||||
Benefits paid | (76,642 | ) | (64,439 | ) | (24,877 | ) | (22,837 | ) | |||||||||||||||||
Projected benefits obligation at end of year | 1,120,492 | 1,237,778 | 270,937 | 318,415 | |||||||||||||||||||||
Change in plan assets | |||||||||||||||||||||||||
Fair value of plan assets at beginning of year | 988,167 | 961,421 | — | — | |||||||||||||||||||||
Actual return on plan assets | 152,976 | 118,073 | — | — | |||||||||||||||||||||
Employer contribution | 32,336 | 21,371 | 24,877 | 22,837 | |||||||||||||||||||||
Settlement | (319 | ) | (49,876 | ) | — | — | |||||||||||||||||||
Currency translation and other | (4,533 | ) | 1,617 | — | — | ||||||||||||||||||||
Benefits paid | (76,642 | ) | (64,439 | ) | (24,877 | ) | (22,837 | ) | |||||||||||||||||
Fair value of plan assets at end of year | 1,091,985 | 988,167 | — | — | |||||||||||||||||||||
Funded status at end of year | $ | (28,507 | ) | $ | (249,611 | ) | $ | (270,937 | ) | $ | (318,415 | ) | |||||||||||||
Schedule of Amounts Recognized in Balance Sheet | ' | ||||||||||||||||||||||||
Amounts recognized in the Consolidated Balance Sheets consisted of the following: | |||||||||||||||||||||||||
Pension Benefits | Other Benefits | ||||||||||||||||||||||||
December 31, | 2013 | 2012 | 2013 | 2012 | |||||||||||||||||||||
In thousands of dollars | |||||||||||||||||||||||||
Other assets | $ | 32,533 | $ | — | $ | — | $ | — | |||||||||||||||||
Accrued liabilities | (10,198 | ) | (9,396 | ) | (25,477 | ) | (26,181 | ) | |||||||||||||||||
Other long-term liabilities | (50,842 | ) | (240,215 | ) | (245,460 | ) | (292,234 | ) | |||||||||||||||||
Total | $ | (28,507 | ) | $ | (249,611 | ) | $ | (270,937 | ) | $ | (318,415 | ) | |||||||||||||
Schedule of Amounts Recognized in Other Comprehensive Income (Loss) | ' | ||||||||||||||||||||||||
Amounts recognized in accumulated other comprehensive loss, net of tax, consisted of the following: | |||||||||||||||||||||||||
Pension Benefits | Other Benefits | ||||||||||||||||||||||||
December 31, | 2013 | 2012 | 2013 | 2012 | |||||||||||||||||||||
In thousands of dollars | |||||||||||||||||||||||||
Actuarial net (loss) gain | $ | (215,702 | ) | $ | (362,039 | ) | $ | 13,107 | $ | (6,320 | ) | ||||||||||||||
Net prior service credit (cost) | 5,698 | 5,539 | (2,737 | ) | (3,217 | ) | |||||||||||||||||||
Total | $ | (210,004 | ) | $ | (356,500 | ) | $ | 10,370 | $ | (9,537 | ) | ||||||||||||||
Schedule of Accumulated Benefit Obligations in Excess of Fair Value of Plan Assets | ' | ||||||||||||||||||||||||
Plans with accumulated benefit obligations in excess of plan assets were as follows: | |||||||||||||||||||||||||
December 31, | 2013 | 2012 | |||||||||||||||||||||||
In thousands of dollars | |||||||||||||||||||||||||
Projected benefit obligation | $ | 76,801 | $ | 1,237,238 | |||||||||||||||||||||
Accumulated benefit obligation | 64,340 | 1,185,214 | |||||||||||||||||||||||
Fair value of plan assets | 15,760 | 987,643 | |||||||||||||||||||||||
Schedule of Net Periodic Benefit Cost Not yet Recognized | ' | ||||||||||||||||||||||||
Net periodic benefit cost for our pension and other post-retirement plans consisted of the following: | |||||||||||||||||||||||||
Pension Benefits | Other Benefits | ||||||||||||||||||||||||
For the years ended December 31, | 2013 | 2012 | 2011 | 2013 | 2012 | 2011 | |||||||||||||||||||
In thousands of dollars | |||||||||||||||||||||||||
Service cost | $ | 31,339 | $ | 30,823 | $ | 30,059 | $ | 1,094 | $ | 1,172 | $ | 1,333 | |||||||||||||
Interest cost | 43,962 | 49,909 | 52,960 | 10,747 | 13,258 | 14,967 | |||||||||||||||||||
Expected return on plan assets | (73,128 | ) | (72,949 | ) | (78,161 | ) | — | — | — | ||||||||||||||||
Amortization of prior service cost (credit) | 422 | 731 | 1,002 | 618 | 619 | (255 | ) | ||||||||||||||||||
Amortization of net loss (gain) | 40,397 | 39,723 | 28,004 | (73 | ) | (101 | ) | (71 | ) | ||||||||||||||||
Administrative expenses | 692 | 545 | 653 | 75 | 120 | 244 | |||||||||||||||||||
Net periodic benefit cost | 43,684 | 48,782 | 34,517 | 12,461 | 15,068 | 16,218 | |||||||||||||||||||
Curtailment (credit) loss | (364 | ) | — | 1,826 | — | — | (174 | ) | |||||||||||||||||
Settlement loss | 18 | 19,676 | 46 | — | — | — | |||||||||||||||||||
Total amount reflected in earnings | $ | 43,338 | $ | 68,458 | $ | 36,389 | $ | 12,461 | $ | 15,068 | $ | 16,044 | |||||||||||||
Schedule of Defined Benefit Plan Amounts Recognized in Other Comprehensive Income (Loss) | ' | ||||||||||||||||||||||||
Amounts recognized in other comprehensive loss (income) and net periodic benefit cost before tax for our pension and other post-retirement plans consisted of the following: | |||||||||||||||||||||||||
Pension Benefits | Other Benefits | ||||||||||||||||||||||||
For the years ended December 31, | 2013 | 2012 | 2011 | 2013 | 2012 | 2011 | |||||||||||||||||||
In thousands of dollars | |||||||||||||||||||||||||
Actuarial net (gain) loss | $ | (230,605 | ) | $ | 8,536 | $ | 120,401 | $ | (33,165 | ) | $ | 7,952 | $ | 11,216 | |||||||||||
Prior service (credit) cost | (613 | ) | (716 | ) | (1,313 | ) | (632 | ) | (613 | ) | 7,614 | ||||||||||||||
Total recognized in other comprehensive (income) loss | $ | (231,218 | ) | $ | 7,820 | $ | 119,088 | $ | (33,797 | ) | $ | 7,339 | $ | 18,830 | |||||||||||
Total recognized in net periodic benefit cost and other comprehensive (income) loss | $ | (187,534 | ) | $ | 56,602 | $ | 153,605 | $ | (21,336 | ) | $ | 22,407 | $ | 35,048 | |||||||||||
Schedule of Amounts in Accumulated Other Comprehensive Income (Loss) to be Recognized over Next Fiscal Year | ' | ||||||||||||||||||||||||
The estimated amounts for the defined benefit pension plans and the post-retirement benefit plans that will be amortized from accumulated other comprehensive income (loss) into net periodic benefit cost over the next fiscal year are as follows (in thousands): | |||||||||||||||||||||||||
Pension Plans | Post-Retirement | ||||||||||||||||||||||||
Benefit Plans | |||||||||||||||||||||||||
Amortization of net actuarial loss (gain) | $ | 22,952 | $ | (109 | ) | ||||||||||||||||||||
Amortization of prior service (credit) cost | $ | (668 | ) | $ | 618 | ||||||||||||||||||||
Schedule of Assumptions Used | ' | ||||||||||||||||||||||||
Certain weighted-average assumptions used in computing the benefit obligations as of December 31, 2013 and 2012 were as follows: | |||||||||||||||||||||||||
Pension Benefits | Other Benefits | ||||||||||||||||||||||||
2013 | 2012 | 2013 | 2012 | ||||||||||||||||||||||
Discount rate | 4.5 | % | 3.7 | % | 4.5 | % | 3.7 | % | |||||||||||||||||
Rate of increase in compensation levels | 4 | % | 4 | % | N/A | N/A | |||||||||||||||||||
For measurement purposes as of December 31, 2013, we assumed an 8.5% annual rate of increase in the per capita cost of covered health care benefits for 2014, grading down to 5.0% by 2019. | |||||||||||||||||||||||||
For measurement purposes as of December 31, 2012, we assumed a 9.1% annual rate of increase in the per capita cost of covered health care benefits for 2013, grading down to 5.0% by 2019. | |||||||||||||||||||||||||
Certain weighted-average assumptions used in computing net periodic benefit cost were as follows: | |||||||||||||||||||||||||
Pension Benefits | Other Benefits | ||||||||||||||||||||||||
For the years ended December 31, | 2013 | 2012 | 2011 | 2013 | 2012 | 2011 | |||||||||||||||||||
Discount rate | 3.7 | % | 4.5 | % | 5.2 | % | 3.7 | % | 4.5 | % | 5.2 | % | |||||||||||||
Expected long-term return on plan assets | 7.75 | % | 8 | % | 8 | % | N/A | N/A | N/A | ||||||||||||||||
Rate of compensation increase | 4 | % | 4.1 | % | 4.1 | % | N/A | N/A | N/A | ||||||||||||||||
Schedule of Effect of One-Percentage-Point Change in Assumed Health Care Cost Trend Rates | ' | ||||||||||||||||||||||||
A one-percentage point change in assumed health care cost trend rates would have the following effects: | |||||||||||||||||||||||||
Impact of assumed health care cost trend rates | One-Percentage | One-Percentage | |||||||||||||||||||||||
Point Increase | Point (Decrease) | ||||||||||||||||||||||||
In thousands of dollars | |||||||||||||||||||||||||
Effect on total service and interest cost components | $ | 172 | $ | (152 | ) | ||||||||||||||||||||
Effect on post-retirement benefit obligation | 4,132 | (3,697 | ) | ||||||||||||||||||||||
Schedule of Allocation of Plan Assets | ' | ||||||||||||||||||||||||
The ranges for the domestic pension plans were as follows: | |||||||||||||||||||||||||
Asset Class | Target Allocation 2013 | ||||||||||||||||||||||||
Equity securities | 55 | % | - | 75% | |||||||||||||||||||||
Debt securities | 25 | % | - | 45% | |||||||||||||||||||||
Cash and certain other investments | 0 | % | - | 5% | |||||||||||||||||||||
As of December 31, 2013, actual allocations were within the specified ranges. We expect the level of volatility in pension plan asset returns to be in line with the overall volatility of the markets within each asset class. | |||||||||||||||||||||||||
The following table sets forth by level, within the fair value hierarchy, pension plan assets at their fair value as of December 31, 2013: | |||||||||||||||||||||||||
In thousands of dollars | Quoted prices in active markets of identical assets | Significant other observable inputs | Significant other unobservable | Total assets measured at fair value as of | |||||||||||||||||||||
(Level 1) | (Level 2) | inputs (Level 3) | December 31, 2013 | ||||||||||||||||||||||
Cash and cash equivalents | $ | 657 | $ | 22,998 | $ | — | $ | 23,655 | |||||||||||||||||
Equity securities: | |||||||||||||||||||||||||
U.S. all-cap (a) | 64,949 | 137,385 | — | 202,334 | |||||||||||||||||||||
U.S. large-cap (b) | 144,254 | — | — | 144,254 | |||||||||||||||||||||
U.S. small/mid-cap | 33,145 | — | — | 33,145 | |||||||||||||||||||||
International all-cap (c) | 136,892 | 3,062 | — | 139,954 | |||||||||||||||||||||
Global all-cap (d) | 181,702 | — | — | 181,702 | |||||||||||||||||||||
Fixed income securities: | |||||||||||||||||||||||||
U.S. government/agency | 109,995 | 34,907 | — | 144,902 | |||||||||||||||||||||
Corporate bonds (e) | 57,735 | 34,616 | — | 92,351 | |||||||||||||||||||||
Collateralized obligations (f) | 56,016 | 22,350 | — | 78,366 | |||||||||||||||||||||
International government/ corporate bonds (g) | 14,018 | 37,304 | — | 51,322 | |||||||||||||||||||||
Total Investments | $ | 799,363 | $ | 292,622 | $ | — | $ | 1,091,985 | |||||||||||||||||
The following table sets forth by level, within the fair value hierarchy, pension plan assets at their fair value as of December 31, 2012: | |||||||||||||||||||||||||
In thousands of dollars | Quoted prices in active markets of identical assets | Significant other observable inputs(Level 2) | Significant other unobservable | Total assets measured at fair value as of | |||||||||||||||||||||
(Level 1) | inputs (Level 3) | December 31, 2012 | |||||||||||||||||||||||
Cash and cash equivalents | $ | 933 | $ | 34,027 | $ | — | $ | 34,960 | |||||||||||||||||
Equity securities: | |||||||||||||||||||||||||
U.S. all-cap (a) | 50,596 | 104,102 | — | 154,698 | |||||||||||||||||||||
U.S. large-cap (b) | 107,934 | — | — | 107,934 | |||||||||||||||||||||
U.S. small/mid-cap | 24,816 | — | — | 24,816 | |||||||||||||||||||||
International all-cap (c) | 111,834 | 2,938 | — | 114,772 | |||||||||||||||||||||
Global all-cap (d) | 229,044 | — | — | 229,044 | |||||||||||||||||||||
Domestic real estate | 24,892 | — | — | 24,892 | |||||||||||||||||||||
Fixed income securities: | |||||||||||||||||||||||||
U.S. government/agency | 76,009 | 27,984 | — | 103,993 | |||||||||||||||||||||
Corporate bonds (e) | 38,001 | 19,691 | — | 57,692 | |||||||||||||||||||||
Collateralized obligations (f) | 61,853 | 27,012 | — | 88,865 | |||||||||||||||||||||
International government/corporate bonds (g) | 13,432 | 33,069 | — | 46,501 | |||||||||||||||||||||
Total Investments | $ | 739,344 | $ | 248,823 | $ | — | $ | 988,167 | |||||||||||||||||
(a) | This category comprises equity funds that track the Russell 3000 index. | ||||||||||||||||||||||||
(b) | This category comprises equity funds that track the S&P 500 and/or Russell 1000 indices. | ||||||||||||||||||||||||
(c) | This category comprises equity funds that track the MSCI World Ex-US index. | ||||||||||||||||||||||||
(d) | This category comprises equity funds that track the MSCI World index. | ||||||||||||||||||||||||
(e) | This category comprises fixed income funds primarily invested in investment grade bonds. | ||||||||||||||||||||||||
(f) | This category comprises fixed income funds primarily invested in high quality mortgage-backed securities and other asset-backed obligations. | ||||||||||||||||||||||||
(g) | This category comprises fixed income funds invested in Canadian and other international bonds. | ||||||||||||||||||||||||
Schedule of Expected Benefit Payments | ' | ||||||||||||||||||||||||
Information about the expected cash flows for our pension and other post-retirement benefit plans is as follows: | |||||||||||||||||||||||||
Expected Benefit Payments | |||||||||||||||||||||||||
2014 | 2015 | 2016 | 2017 | 2018 | 2019-2023 | ||||||||||||||||||||
In thousands of dollars | |||||||||||||||||||||||||
Pension Benefits | $ | 67,617 | $ | 64,641 | $ | 69,085 | $ | 101,765 | $ | 83,559 | $ | 544,322 | |||||||||||||
Other Benefits | 25,491 | 24,690 | 23,796 | 22,411 | 20,843 | 85,699 | |||||||||||||||||||
CAPITAL_STOCK_AND_NET_INCOME_P1
CAPITAL STOCK AND NET INCOME PER SHARE (Tables) | 12 Months Ended | ||||||||||||
Dec. 31, 2013 | |||||||||||||
Capital Stock and Net Income Per Share [Abstract] | ' | ||||||||||||
Changes in Outstanding Common Stock | ' | ||||||||||||
Changes in outstanding Common Stock for the past 3 years were as follows: | |||||||||||||
For the years ended December 31, | 2013 | 2012 | 2011 | ||||||||||
Shares issued | 359,901,744 | 359,901,744 | 359,901,744 | ||||||||||
Treasury shares at beginning of year | (136,115,714 | ) | (134,695,826 | ) | (132,871,512 | ) | |||||||
Stock repurchases: | |||||||||||||
Repurchase programs | — | (2,054,354 | ) | (1,902,753 | ) | ||||||||
Stock-based compensation programs | (3,655,830 | ) | (5,598,537 | ) | (5,179,028 | ) | |||||||
Stock issuances: | |||||||||||||
Stock-based compensation programs | 3,764,521 | 6,233,003 | 5,257,467 | ||||||||||
Treasury shares at end of year | (136,007,023 | ) | (136,115,714 | ) | (134,695,826 | ) | |||||||
Net shares outstanding at end of year | 223,894,721 | 223,786,030 | 225,205,918 | ||||||||||
Basic and Diluted Earnings Per Share | ' | ||||||||||||
Basic and Diluted Earnings Per Share were computed based on the weighted-average number of shares of the Common Stock and the Class B Stock outstanding as follows: | |||||||||||||
For the years ended December 31, | 2013 | 2012 | 2011 | ||||||||||
In thousands except per share amounts | |||||||||||||
Net income | $ | 820,470 | $ | 660,931 | $ | 628,962 | |||||||
Weighted-average shares—Basic | |||||||||||||
Common Stock | 163,549 | 164,406 | 165,929 | ||||||||||
Class B Stock | 60,627 | 60,630 | 60,645 | ||||||||||
Total weighted-average shares—Basic | 224,176 | 225,036 | 226,574 | ||||||||||
Effect of dilutive securities: | |||||||||||||
Employee stock options | 2,476 | 2,608 | 2,565 | ||||||||||
Performance and restricted stock units | 551 | 693 | 780 | ||||||||||
Weighted-average shares—Diluted | 227,203 | 228,337 | 229,919 | ||||||||||
Earnings Per Share—Basic | |||||||||||||
Common Stock | $3.76 | $3.01 | $2.85 | ||||||||||
Class B Stock | $3.39 | $2.73 | $2.58 | ||||||||||
Earnings Per Share—Diluted | |||||||||||||
Common Stock | $3.61 | $2.89 | $2.74 | ||||||||||
Class B Stock | $3.37 | $2.71 | $2.56 | ||||||||||
STOCK_COMPENSATION_PLAN_Tables
STOCK COMPENSATION PLAN (Tables) | 12 Months Ended | ||||||||||||||||||
Dec. 31, 2013 | |||||||||||||||||||
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | ' | ||||||||||||||||||
Stock Compensation Costs | ' | ||||||||||||||||||
The following table summarizes our compensation costs: | |||||||||||||||||||
For the years ended December 31, | 2013 | 2012 | 2011 | ||||||||||||||||
In millions of dollars | |||||||||||||||||||
Total compensation amount charged against income for stock compensation plans, including stock options, performance stock units and restricted stock units | $ | 54 | $ | 50.5 | $ | 43.5 | |||||||||||||
Total income tax benefit recognized in Consolidated Statements of Income for share-based compensation | $ | 18.5 | $ | 17.5 | $ | 15.1 | |||||||||||||
Compensation Amount Charged Against Income For Stock Options | ' | ||||||||||||||||||
The following table summarizes our compensation costs for stock options: | |||||||||||||||||||
For the years ended December 31, | 2013 | 2012 | 2011 | ||||||||||||||||
In millions of dollars | |||||||||||||||||||
Compensation amount charged against income for stock options | $ | 21.4 | $ | 19.3 | $ | 22.5 | |||||||||||||
Schedule of Share-based Compensation, Stock Options, Activity | ' | ||||||||||||||||||
A summary of the status of our Company’s stock options and changes during the last three years follows: | |||||||||||||||||||
2013 | 2012 | 2011 | |||||||||||||||||
Stock Options | Shares | Weighted- | Shares | Weighted- | Shares | Weighted- | |||||||||||||
Average | Average | Average | |||||||||||||||||
Exercise | Exercise | Exercise | |||||||||||||||||
Price | Price | Price | |||||||||||||||||
Outstanding at beginning of year | 10,553,914 | $48.08 | 14,540,442 | $44.86 | 17,997,082 | $42.21 | |||||||||||||
Granted | 1,779,109 | $81.95 | 2,110,945 | $60.89 | 2,191,627 | $51.62 | |||||||||||||
Exercised | (3,315,990 | ) | $45.25 | (5,870,607 | ) | $44.55 | (4,875,122 | ) | $38.30 | ||||||||||
Forfeited | (356,697 | ) | $64.38 | (226,866 | ) | $52.02 | (773,145 | ) | $43.90 | ||||||||||
Outstanding at end of year | 8,660,336 | $55.47 | 10,553,914 | $48.08 | 14,540,442 | $44.86 | |||||||||||||
Options exercisable at year-end | 4,290,416 | $46.45 | 5,320,775 | $45.74 | 8,453,362 | $46.95 | |||||||||||||
Weighted-average fair value of options granted during the year (per share) | $ | 14.51 | $ | 10.6 | $ | 9.97 | |||||||||||||
Fair Value of Each Stock Option Grant | ' | ||||||||||||||||||
The following table sets forth information about the weighted-average fair value of options granted to employees during each year using the Black-Scholes option-pricing model and the weighted-average assumptions used for such grants: | |||||||||||||||||||
For the years ended December 31, | 2013 | 2012 | 2011 | ||||||||||||||||
Dividend yields | 2.2 | % | 2.4 | % | 2.7 | % | |||||||||||||
Expected volatility | 22.2 | % | 22.4 | % | 22.5 | % | |||||||||||||
Risk-free interest rates | 1.4 | % | 1.5 | % | 2.8 | % | |||||||||||||
Expected lives in years | 6.6 | 6.6 | 6.5 | ||||||||||||||||
Intrinsic Value Of Options Exercised | ' | ||||||||||||||||||
The following table summarizes the intrinsic value of our stock options: | |||||||||||||||||||
For the years ended December 31, | 2013 | 2012 | 2011 | ||||||||||||||||
In millions of dollars | |||||||||||||||||||
Intrinsic value of options exercised | $ | 135.4 | $ | 130.2 | $ | 81.3 | |||||||||||||
Schedule of Share-based Compensation, Shares Authorized under Stock Option Plans, by Exercise Price Range | ' | ||||||||||||||||||
The following table summarizes information about stock options outstanding as of December 31, 2013: | |||||||||||||||||||
Options Outstanding | Options Exercisable | ||||||||||||||||||
Range of Exercise Prices | Number | Weighted- | Weighted- | Number | Weighted- | ||||||||||||||
Outstanding as | Average | Average | Exercisable as of | Average | |||||||||||||||
of 12/31/13 | Remaining | Exercise Price | 12/31/13 | Exercise Price | |||||||||||||||
Contractual | |||||||||||||||||||
Life in Years | |||||||||||||||||||
$33.40 - $39.26 | 2,514,127 | 5 | $ | 37.19 | 2,000,140 | $ | 36.66 | ||||||||||||
$39.57 - $60.10 | 2,503,703 | 5.1 | $ | 51.94 | 1,595,372 | $ | 52.14 | ||||||||||||
$60.68 - $91.65 | 3,642,506 | 7.9 | $ | 70.51 | 694,904 | $ | 61.58 | ||||||||||||
$33.40 - $91.65 | 8,660,336 | 6.3 | $ | 55.47 | 4,290,416 | $ | 46.45 | ||||||||||||
Compensation Amount Charged Against Income For Performance And Restricted Stock Units | ' | ||||||||||||||||||
For the years ended December 31, | 2013 | 2012 | 2011 | ||||||||||||||||
In millions of dollars | |||||||||||||||||||
Compensation amount charged against income for performance and restricted stock units | $ | 32.6 | $ | 31.2 | $ | 21 | |||||||||||||
Schedule Of Share Based Payment Award Market Based Total Shareholder Return Valuation Assumptions | ' | ||||||||||||||||||
The following table sets forth information about the fair value of the PSUs and RSUs granted for potential future distribution to employees and directors during the year. In addition, the table provides assumptions used to determine fair value of the market-based total shareholder return component using the Monte Carlo simulation model on the date of grant. | |||||||||||||||||||
For the years ended December 31, | 2013 | 2012 | 2011 | ||||||||||||||||
Units granted | 395,862 | 503,761 | 543,596 | ||||||||||||||||
Weighted-average fair value at date of grant | $ | 88.49 | $ | 64.99 | $ | 58.28 | |||||||||||||
Monte Carlo simulation assumptions: | |||||||||||||||||||
Estimated values | $ | 55.49 | $ | 35.62 | $ | 37.79 | |||||||||||||
Dividend yields | 2 | % | 2.5 | % | 2.7 | % | |||||||||||||
Expected volatility | 17.1 | % | 20 | % | 28.8 | % | |||||||||||||
Schedule of Share-based Compensation, Restricted Stock and Restricted Stock Units Activity | ' | ||||||||||||||||||
A summary of the status of our Company’s performance stock units and restricted stock units as of December 31, 2013 and the change during 2013 follows: | |||||||||||||||||||
Performance Stock Units and Restricted Stock Units | 2013 | Weighted-average grant date fair value | |||||||||||||||||
for equity awards or market value for | |||||||||||||||||||
liability awards | |||||||||||||||||||
Outstanding at beginning of year | 1,720,577 | $56.71 | |||||||||||||||||
Granted | 395,862 | $88.49 | |||||||||||||||||
Performance assumption change | 176,534 | $84.27 | |||||||||||||||||
Vested | (754,991 | ) | $50.33 | ||||||||||||||||
Forfeited | (126,583 | ) | $71.80 | ||||||||||||||||
Outstanding at end of year | 1,411,399 | $72.43 | |||||||||||||||||
Share Based Compensation Arrangement By Share Based Payment Award Intrinsic Value Of Share Based Liabilities Paid Combined With Fair Value Of Shares Vested | ' | ||||||||||||||||||
For the years ended December 31, | 2013 | 2012 | 2011 | ||||||||||||||||
In millions of dollars | |||||||||||||||||||
Intrinsic value of share-based liabilities paid, combined with the fair value of shares vested | $ | 62.6 | $ | 37.3 | $ | 36.6 | |||||||||||||
SUPPLEMENTAL_BALANCE_SHEET_INF1
SUPPLEMENTAL BALANCE SHEET INFORMATION (Tables) | 12 Months Ended | ||||||||||||||||||||
Dec. 31, 2013 | |||||||||||||||||||||
SUPPLEMENTAL BALANCE SHEET INFORMATION [Abstract] | ' | ||||||||||||||||||||
Inventory | ' | ||||||||||||||||||||
Total inventories were as follows: | |||||||||||||||||||||
December 31, | 2013 | 2012 | |||||||||||||||||||
In thousands of dollars | |||||||||||||||||||||
Raw materials | $ | 226,978 | $ | 256,969 | |||||||||||||||||
Goods in process | 79,861 | 78,292 | |||||||||||||||||||
Finished goods | 517,968 | 496,981 | |||||||||||||||||||
Inventories at FIFO | 824,807 | 832,242 | |||||||||||||||||||
Adjustment to LIFO | (165,266 | ) | (198,980 | ) | |||||||||||||||||
Total inventories | $ | 659,541 | $ | 633,262 | |||||||||||||||||
Property, Plant and Equipment | ' | ||||||||||||||||||||
Major classes of property, plant and equipment were as follows: | |||||||||||||||||||||
December 31, | 2013 | 2012 | |||||||||||||||||||
In thousands of dollars | |||||||||||||||||||||
Land | $ | 96,334 | $ | 92,916 | |||||||||||||||||
Buildings | 956,890 | 878,527 | |||||||||||||||||||
Machinery and equipment | 2,726,170 | 2,589,183 | |||||||||||||||||||
Property, plant and equipment, gross | 3,779,394 | 3,560,626 | |||||||||||||||||||
Accumulated depreciation | (1,974,049 | ) | (1,886,555 | ) | |||||||||||||||||
Property, plant and equipment, net | $ | 1,805,345 | $ | 1,674,071 | |||||||||||||||||
Goodwill and Other Intangibles Assets | ' | ||||||||||||||||||||
Goodwill and intangible assets were as follows: | |||||||||||||||||||||
December 31, | 2013 | 2012 | |||||||||||||||||||
In thousands of dollars | |||||||||||||||||||||
Unamortized intangible assets: | |||||||||||||||||||||
Goodwill balance at beginning of year | $ | 588,003 | $ | 516,745 | |||||||||||||||||
Effect of foreign currency translation | (11,442 | ) | 3,284 | ||||||||||||||||||
Acquisitions | — | 67,974 | |||||||||||||||||||
Goodwill balance at end of year | $ | 576,561 | $ | 588,003 | |||||||||||||||||
Trademarks with indefinite lives | $ | 81,465 | $ | 81,465 | |||||||||||||||||
Amortized intangible assets, gross: | |||||||||||||||||||||
Trademarks | 64,436 | 68,490 | |||||||||||||||||||
Customer-related | 72,094 | 74,790 | |||||||||||||||||||
Intangible asset associated with cooperative agreement with Bauducco | 13,683 | 13,683 | |||||||||||||||||||
Patents | 19,278 | 20,018 | |||||||||||||||||||
Effect of foreign currency translation | (9,256 | ) | (6,470 | ) | |||||||||||||||||
Total other intangible assets, gross | 241,700 | 251,976 | |||||||||||||||||||
Accumulated amortization: | |||||||||||||||||||||
Trademarks | (5,190 | ) | (2,250 | ) | |||||||||||||||||
Customer-related | (26,853 | ) | (22,990 | ) | |||||||||||||||||
Intangible asset associated with cooperative agreement with Bauducco | (7,379 | ) | (6,294 | ) | |||||||||||||||||
Patents | (9,737 | ) | (7,411 | ) | |||||||||||||||||
Effect of foreign currency translation | 2,703 | 1,682 | |||||||||||||||||||
Total accumulated amortization | (46,456 | ) | (37,263 | ) | |||||||||||||||||
Other intangibles | $ | 195,244 | $ | 214,713 | |||||||||||||||||
Finite-Lived Intangible Assets, Future Amortization Expense | ' | ||||||||||||||||||||
Estimated annual amortization expense for other intangible assets over the next five years is as follows: | |||||||||||||||||||||
Annual Amortization Expense | 2014 | 2015 | 2016 | 2017 | 2018 | ||||||||||||||||
In thousands of dollars | |||||||||||||||||||||
Estimated amortization expense | $ | 10,452 | $ | 9,916 | $ | 9,913 | $ | 9,245 | $ | 8,151 | |||||||||||
Accrued Liabilities | ' | ||||||||||||||||||||
Accrued liabilities were as follows: | |||||||||||||||||||||
December 31, | 2013 | 2012 | |||||||||||||||||||
In thousands of dollars | |||||||||||||||||||||
Payroll, compensation and benefits | $ | 245,641 | $ | 236,598 | |||||||||||||||||
Advertising and promotion | 348,966 | 289,221 | |||||||||||||||||||
Other | 105,115 | 125,087 | |||||||||||||||||||
Total accrued liabilities | $ | 699,722 | $ | 650,906 | |||||||||||||||||
Other Long-Term Liabilities | ' | ||||||||||||||||||||
Other long-term liabilities were as follows: | |||||||||||||||||||||
December 31, | 2013 | 2012 | |||||||||||||||||||
In thousands of dollars | |||||||||||||||||||||
Post-retirement benefits liabilities | $ | 245,460 | $ | 292,234 | |||||||||||||||||
Pension benefits liabilities | 50,842 | 240,215 | |||||||||||||||||||
Other | 137,766 | 136,283 | |||||||||||||||||||
Total other long-term liabilities | $ | 434,068 | $ | 668,732 | |||||||||||||||||
QUARTERLY_DATA_QUATERLY_DATA_T
QUARTERLY DATA QUATERLY DATA (Tables) | 12 Months Ended | ||||||||||||||||
Dec. 31, 2013 | |||||||||||||||||
Quarterly Data [Abstract] | ' | ||||||||||||||||
Schedule of Quarterly Financial Information | ' | ||||||||||||||||
Year 2013 | First | Second | Third | Fourth | |||||||||||||
In thousands of dollars except per share amounts | |||||||||||||||||
Net sales | $ | 1,827,426 | $ | 1,508,514 | $ | 1,853,886 | $ | 1,956,253 | |||||||||
Gross profit | 849,337 | 718,574 | 855,551 | 857,386 | |||||||||||||
Net income | 241,906 | 159,504 | 232,985 | 186,075 | |||||||||||||
Class B Common Stock: | |||||||||||||||||
Net income per share—Basic | 1 | 0.66 | 0.96 | 0.77 | |||||||||||||
Net income per share—Diluted(a) | 0.99 | 0.66 | 0.95 | 0.76 | |||||||||||||
Dividends paid per share | 0.38 | 0.38 | 0.435 | 0.435 | |||||||||||||
Common Stock: | |||||||||||||||||
Net income per share—Basic | 1.11 | 0.73 | 1.07 | 0.85 | |||||||||||||
Net income per share—Diluted | 1.06 | 0.7 | 1.03 | 0.82 | |||||||||||||
Dividends paid per share | 0.42 | 0.42 | 0.485 | 0.485 | |||||||||||||
Market Price | |||||||||||||||||
High | 87.53 | 91.25 | 97.69 | 100.9 | |||||||||||||
Low | 73.51 | 85.25 | 89.17 | 91.04 | |||||||||||||
Year 2012 | First | Second | Third | Fourth | |||||||||||||
In thousands of dollars except per share amounts | |||||||||||||||||
Net sales | $ | 1,732,064 | $ | 1,414,444 | $ | 1,746,709 | $ | 1,751,035 | |||||||||
Gross profit | 743,396 | 618,521 | 742,757 | 755,208 | |||||||||||||
Net income | 198,651 | 135,685 | 176,716 | 149,879 | |||||||||||||
Class B Common Stock: | |||||||||||||||||
Net income per share—Basic | 0.82 | 0.56 | 0.73 | 0.62 | |||||||||||||
Net income per share—Diluted | 0.81 | 0.55 | 0.73 | 0.62 | |||||||||||||
Dividends paid per share | 0.344 | 0.344 | 0.344 | 0.38 | |||||||||||||
Common Stock: | |||||||||||||||||
Net income per share—Basic(a) | 0.91 | 0.62 | 0.8 | 0.69 | |||||||||||||
Net income per share—Diluted | 0.87 | 0.59 | 0.77 | 0.66 | |||||||||||||
Dividends paid per share | 0.38 | 0.38 | 0.38 | 0.42 | |||||||||||||
Market Price | |||||||||||||||||
High | 61.94 | 72.03 | 73.16 | 74.64 | |||||||||||||
Low | 59.49 | 59.81 | 70.09 | 68.85 | |||||||||||||
(a) | Quarterly income per share amounts do not total to the annual amount due to changes in weighted-average shares outstanding during the year. |
SUMMARY_OF_SIGNIFICANT_ACCOUNT2
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details) (USD $) | 12 Months Ended | ||
Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | |
Summary of Significant Accounting Policies [Line Items] | ' | ' | ' |
Equity Method Investments | $39,900,000 | $39,200,000 | ' |
Equity Method Investment, Ownership Percentage | 44.00% | ' | ' |
Payments for Advance to Affiliate | 16,000,000 | 23,000,000 | 7,000,000 |
Advertising Expense | 582,400,000 | 480,000,000 | 414,200,000 |
Prepaid Advertising | 8,400,000 | 9,500,000 | ' |
Accumulated Amortization | 1,974,049,000 | 1,886,555,000 | ' |
Research and Development Expense | 47,600,000 | 39,000,000 | 33,200,000 |
Trademarks [Member] | ' | ' | ' |
Summary of Significant Accounting Policies [Line Items] | ' | ' | ' |
Finite-Lived Intangible Asset, Useful Life | '25 years | ' | ' |
Customer Relationships [Member] | ' | ' | ' |
Summary of Significant Accounting Policies [Line Items] | ' | ' | ' |
Finite-Lived Intangible Asset, Useful Life | '15 years | ' | ' |
Patents [Member] | ' | ' | ' |
Summary of Significant Accounting Policies [Line Items] | ' | ' | ' |
Finite-Lived Intangible Asset, Useful Life | '5 years | ' | ' |
Machinery and Equipment [Member] | Minimum [Member] | ' | ' | ' |
Summary of Significant Accounting Policies [Line Items] | ' | ' | ' |
Property, Plant and Equipment, Useful Life | '3 years | ' | ' |
Machinery and Equipment [Member] | Maximum [Member] | ' | ' | ' |
Summary of Significant Accounting Policies [Line Items] | ' | ' | ' |
Property, Plant and Equipment, Useful Life | '15 years | ' | ' |
Building and Building Improvements [Member] | Minimum [Member] | ' | ' | ' |
Summary of Significant Accounting Policies [Line Items] | ' | ' | ' |
Property, Plant and Equipment, Useful Life | '25 years | ' | ' |
Building and Building Improvements [Member] | Maximum [Member] | ' | ' | ' |
Summary of Significant Accounting Policies [Line Items] | ' | ' | ' |
Property, Plant and Equipment, Useful Life | '40 years | ' | ' |
Software and Software Development Costs [Member] | ' | ' | ' |
Summary of Significant Accounting Policies [Line Items] | ' | ' | ' |
Accumulated Amortization | 277,900,000 | 256,100,000 | ' |
Capitalized Computer Software, Net | $56,500,000 | $50,500,000 | ' |
Software and Software Development Costs [Member] | Minimum [Member] | ' | ' | ' |
Summary of Significant Accounting Policies [Line Items] | ' | ' | ' |
Property, Plant and Equipment, Useful Life | '3 years | ' | ' |
Software and Software Development Costs [Member] | Maximum [Member] | ' | ' | ' |
Summary of Significant Accounting Policies [Line Items] | ' | ' | ' |
Property, Plant and Equipment, Useful Life | '5 years | ' | ' |
BUSINESS_ACQUISITIONS_AND_DIVE2
BUSINESS ACQUISITIONS AND DIVESTITURES (Details) (USD $) | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Dec. 31, 2012 | Dec. 31, 2012 | Dec. 31, 2013 |
Brookside [Member] | Brookside [Member] | Shanghai Golden Monkey [Member] | ||||
Trademarks [Member] | ||||||
Business Acquisition [Line Items] | ' | ' | ' | ' | ' | ' |
Business Acquisition, Name of Acquired Entity | ' | ' | ' | 'Brookside Foods Ltd. | ' | 'Shanghai Golden Monkey Food Joint Stock Co., Ltd. |
Estimated purchase price | ' | ' | ' | ' | ' | $584,000,000 |
Estimated cash payment to acquire business | ' | ' | ' | ' | ' | 498,000,000 |
Estimated liabilities to be assumed | ' | ' | ' | ' | ' | 86,000,000 |
Goodwill | 576,561,000 | 588,003,000 | 516,745,000 | 67,974,000 | ' | ' |
Finite-Lived Acquired Intangibles | ' | ' | ' | 51,057,000 | 60,253,000 | ' |
Other assets, net of liabilities assumed | ' | ' | ' | 21,673,000 | ' | ' |
Non-current deferred tax liabilities | ' | ' | ' | -28,101,000 | ' | ' |
Purchase price | ' | ' | ' | 172,856,000 | ' | ' |
Finite-Lived Trademark, Useful Life | ' | ' | ' | '25 years | ' | ' |
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Liabilities | ' | ' | ' | $18,700,000 | ' | ' |
Other Acquired Intangibles Useful Life, Minimum | ' | ' | ' | '6 years | ' | ' |
Other Acquired Intangible Assets Useful Life, Maximum | ' | ' | ' | '17 years | ' | ' |
BUSINESS_REALIGNMENT_AND_IMPAI2
BUSINESS REALIGNMENT AND IMPAIRMENT CHARGES (Details) (USD $) | 12 Months Ended | |||
Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Dec. 31, 2010 | |
Business Realignment And Impairment Charges [Line Items] | ' | ' | ' | ' |
Total Restructuring Costs Recorded in Cost of Sales | $402,000 | $36,383,000 | $45,096,000 | ' |
Total Business Realignment And Impairment Charges (Credits), Net | 18,665,000 | 44,938,000 | -886,000 | ' |
Total net charges associated with business realignment initiatives and impairment | 19,085,000 | 83,767,000 | 49,171,000 | ' |
Equity Method Investment, Ownership Percentage | 44.00% | ' | ' | ' |
Payments to Acquire Additional Interest in Subsidiaries | 0 | 15,791,000 | 0 | ' |
Next Century Program [Member] | ' | ' | ' | ' |
Business Realignment And Impairment Charges [Line Items] | ' | ' | ' | ' |
Next Century Program Other Restructuring Costs recorded in cost of sales | 402,000 | 36,383,000 | 39,280,000 | ' |
Next Century Program Other Restructuring Costs recorded in selling, marketing and administrative expense | 18,000 | 2,446,000 | 4,961,000 | ' |
Pension settlement loss | 0 | 15,787,000 | 0 | ' |
Plant Closure Expenses | 16,387,000 | 20,780,000 | 8,620,000 | ' |
Employee separation costs (credits) | 0 | 914,000 | -9,506,000 | ' |
Restructuring and Related Cost, Cost Incurred to Date | 190,400,000 | ' | ' | ' |
Total costs recorded during the period for this program | 16,800,000 | 76,300,000 | 43,400,000 | 53,900,000 |
Severance Costs Credits | ' | ' | 11,200,000 | ' |
Curtailment Loss | ' | ' | 1,700,000 | ' |
Restructuring and Related Cost, Incurred Cost | 7,600,000 | 12,800,000 | ' | ' |
Next Century Program [Member] | Maximum [Member] | ' | ' | ' | ' |
Business Realignment And Impairment Charges [Line Items] | ' | ' | ' | ' |
Estimated Next Century pretax and nonrecurring project implementation costs, maximum | 200,000,000 | ' | ' | ' |
Next Century Program [Member] | Minimum [Member] | ' | ' | ' | ' |
Business Realignment And Impairment Charges [Line Items] | ' | ' | ' | ' |
Estimated Next Century pretax and nonrecurring project implementation costs, minimum | 190,000,000 | ' | ' | ' |
Tri-US, Inc. [Member] | ' | ' | ' | ' |
Business Realignment And Impairment Charges [Line Items] | ' | ' | ' | ' |
Asset Impairment Charges | 0 | 7,457,000 | 0 | ' |
Equity Method Investment, Ownership Percentage | ' | ' | 49.00% | ' |
Payments to Acquire Equity Method Investments | ' | ' | 5,800,000 | ' |
Payments to Acquire Additional Interest in Subsidiaries | ' | 6,000,000 | ' | ' |
Noncontrolling Interest, Ownership Percentage by Parent | ' | 69.00% | ' | ' |
Global Supply Chain Transformation Program [Member] | ' | ' | ' | ' |
Business Realignment And Impairment Charges [Line Items] | ' | ' | ' | ' |
Global Supply Chain Transformation Program Other Restructuring Costs Recorded In Cost of Sales | 0 | 0 | 5,816,000 | ' |
Godrej Hershey Ltd [Member] | ' | ' | ' | ' |
Business Realignment And Impairment Charges [Line Items] | ' | ' | ' | ' |
Employee separation costs (credits) | $2,278,000 | $0 | $0 | ' |
NONCONTROLLING_INTERESTS_IN_SU1
NONCONTROLLING INTERESTS IN SUBSIDIARIES (Details) (USD $) | 12 Months Ended | ||
Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | |
Noncontrolling Interest [Line Items] | ' | ' | ' |
Payments to Acquire Additional Interest in Subsidiaries | $0 | $15,791,000 | $0 |
Contributions from Noncontrolling Interests | 2,940,000 | 2,940,000 | 0 |
Noncontrolling interests in subsidiaries | 11,218,000 | 11,624,000 | ' |
Net Income (Loss) Attributable to Noncontrolling Interest | 1,700,000 | 9,600,000 | 7,400,000 |
Godrej Hershey Ltd Subsidiary | ' | ' | ' |
Noncontrolling Interest [Line Items] | ' | ' | ' |
Noncontrolling Interest, Ownership Percentage by Parent | 51.00% | ' | ' |
Acquisition of additional interest | 49.00% | ' | ' |
Payments to Acquire Additional Interest in Subsidiaries | 15,800,000 | ' | ' |
Noncontrolling interests in subsidiaries | 10,300,000 | ' | ' |
Hershey Do Brasil Subsidiary | ' | ' | ' |
Noncontrolling Interest [Line Items] | ' | ' | ' |
Noncontrolling Interest, Ownership Percentage by Parent | 51.00% | ' | ' |
Investments in and Advances to Affiliates, at Fair Value, Gross Additions | 3,100,000 | ' | ' |
Contributions from Noncontrolling Interests | $2,900,000 | ' | ' |
COMMITMENTS_AND_CONTINGENCIES_1
COMMITMENTS AND CONTINGENCIES (Details) (USD $) | 12 Months Ended |
In Millions, unless otherwise specified | Dec. 31, 2013 |
Loss Contingencies [Line Items] | ' |
Loss Contingency, Damages Paid, Value | $4 |
Expected construction costs | 240 |
Future minimum payments under non-cancelable operating leases [Abstract] | ' |
2014 | 36.7 |
2015 | 11.5 |
2016 | 10.8 |
2017 | 7.6 |
2018 | 2.2 |
Thereafter | 1.6 |
Leases, Operating [Abstract] | ' |
Operating lease payment | 24 |
Lessee Leasing Arrangements, Operating Leases, Term of Contract | '99 years |
Unrecorded Unconditional Purchase Obligation, Rolling Maturity [Abstract] | ' |
2014 | 1,381.60 |
2015 | 651.9 |
2016 | 48.3 |
2017 | $6.40 |
US [Member] | ' |
Loss Contingencies [Line Items] | ' |
Loss Contingency, Pending Claims, Number | 91 |
Canada [Member] | ' |
Loss Contingencies [Line Items] | ' |
Loss Contingency, Pending Claims, Number | 13 |
DERIVATIVE_INSTRUMENTS_AND_HED2
DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES (Details) (USD $) | 12 Months Ended | |
Dec. 31, 2013 | Dec. 31, 2012 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | ' | ' |
Cash Flow Hedge Gain (Loss) to be Reclassified within Twelve Months | $22,500,000 | ' |
Fair value of foreign exchange forward contracts and options with gains | 3,400,000 | ' |
Fair value of foreign exchange forward contracts and options with losses | 200,000 | ' |
Minimum Notional Amount Of Foreign Currency Derivative Purchase Contracts | 17,100,000 | ' |
Maximum Notional Amount Of Foreign Currency Derivative Purchase Contracts | 158,400,000 | ' |
Minimum Notional Amount Of Foreign Currency Derivative Sale Contracts | 2,800,000 | ' |
Maximum Notional Amount Of Foreign Currency Derivative Sale Contracts | 192,800,000 | ' |
Description of Derivative Activity Minimum Volume | 45,000 | ' |
Description of Derivative Activity Maximum Volume | 60,000 | ' |
Interest Rate Swap Agreements | ' | ' |
Balance Sheet Caption | ' | ' |
Prepaid expense and other current assets | 0 | 0 |
Other assets | 22,745,000 | ' |
Accrued liabilities | 0 | 12,502,000 |
Other long-term liabilities | 0 | 922,000 |
Cash Flow Hedging Derivatives | ' | ' |
Gains (losses) recognized in other comprehensive income (OCI)(effective portion) | 27,534,000 | -13,424,000 |
Gains (losses) reclassified from accumulated OCI into income (effective portion) | -3,606,000 | -3,605,000 |
Gains (losses) recognized in income (ineffective portion) | 0 | 0 |
Foreign Exchange Forward Contracts and Options | ' | ' |
Balance Sheet Caption | ' | ' |
Prepaid expense and other current assets | 2,672,000 | 2,119,000 |
Other assets | 751,000 | ' |
Accrued liabilities | 0 | 917,000 |
Other long-term liabilities | 198,000 | 0 |
Cash Flow Hedging Derivatives | ' | ' |
Gains (losses) recognized in other comprehensive income (OCI)(effective portion) | 4,049,000 | 47,000 |
Gains (losses) reclassified from accumulated OCI into income (effective portion) | 2,641,000 | -2,488,000 |
Gains (losses) recognized in income (ineffective portion) | 0 | 0 |
Commodities Futures and Options Contracts | ' | ' |
Balance Sheet Caption | ' | ' |
Prepaid expense and other current assets | 4,306,000 | 0 |
Other assets | 0 | ' |
Accrued liabilities | 129,000 | 2,010,000 |
Other long-term liabilities | 0 | 0 |
Cash Flow Hedging Derivatives | ' | ' |
Gains (losses) recognized in other comprehensive income (OCI)(effective portion) | 84,746,000 | 12,834,000 |
Gains (losses) reclassified from accumulated OCI into income (effective portion) | -8,400,000 | -90,900,000 |
Gains (losses) recognized in income (ineffective portion) | $3,241,000 | $670,000 |
FINANCIAL_INSTRUMENTS_Details
FINANCIAL INSTRUMENTS (Details) (USD $) | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2012 | Dec. 31, 2012 | Dec. 31, 2011 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2011 | Dec. 31, 2011 |
Notes Due 2013 [Member] | Notes Due 2015 [Member] | Notes Due 2016 [Member] | Notes Due 2023 [Member] | Interest Rate Swap Agreement April 2012 [Member] | Interest Rate Swap Agreement April 2012 [Member] | Interest Rate Swap Agreement May 2012 [Member] | Interest Rate Swap Agreement March 2013 [Member] | Interest Rate Swap Agreement March 2009 [Member] | Interest Rate Swap Agreement September 2011 [Member] | |||
Financial Instruments [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Carrying value of long-term debt | $1,796,056,000 | $1,788,701,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Fair value of long-term debt | 1,947,000,000 | 2,060,800,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Notional Amount of Interest Rate Swap Agreements | ' | ' | ' | ' | ' | ' | ' | 250,000,000 | 250,000,000 | ' | 250,000,000 | ' |
Weighted Average Interest Rate On Interest Rate Swap Agreements | ' | ' | ' | ' | ' | ' | ' | 2.40% | 2.70% | 2.10% | ' | ' |
Amount of Notes Issued | ' | ' | 250,000,000 | 250,000,000 | ' | ' | ' | ' | ' | ' | ' | ' |
Debt Instrument, Interest Rate, Stated Percentage | ' | ' | 5.00% | 4.85% | 1.50% | 2.63% | ' | ' | ' | ' | ' | ' |
Debt Instrument, Maturity Date | ' | ' | ' | ' | 1-Nov-16 | 1-May-23 | ' | ' | ' | ' | ' | ' |
Interest Rate Cash Flow Hedge Asset at Fair Value | 22,700,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Derivative, Gain (Loss) on Derivative, Net | ' | ' | ' | ' | ' | ' | 9,500,000 | ' | ' | 200,000 | 26,800,000 | 2,300,000 |
Notional Amount of Foreign Currency Derivative Purchase Contracts | 158,400,000 | 17,100,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Notional Amount of Foreign Currency Derivative Sale Contracts | 2,800,000 | 57,800,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Fair value of foreign exchange forward contracts, net b asset (liability) | $3,200,000 | $1,200,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
FAIR_VALUE_ACCOUNTING_Details
FAIR VALUE ACCOUNTING (Details) (USD $) | Dec. 31, 2013 | Dec. 31, 2012 |
In Thousands, unless otherwise specified | ||
Fair value [Member] | ' | ' |
Fair Value Assets And Liabilities Measured On Recurring Basis [Line Items] | ' | ' |
Cash flow hedging derivatives - Assets | $54,254 | $39,175 |
Cash flow hedging derivatives - Liabilities | 24,107 | 53,407 |
Quoted Prices in Active Markets of Identical Assets (Level 1) | ' | ' |
Fair Value Assets And Liabilities Measured On Recurring Basis [Line Items] | ' | ' |
Cash flow hedging derivatives - Assets | 28,086 | 37,056 |
Cash flow hedging derivatives - Liabilities | 23,909 | 39,066 |
Significant Other Observable Inputs (Level 2) | ' | ' |
Fair Value Assets And Liabilities Measured On Recurring Basis [Line Items] | ' | ' |
Cash flow hedging derivatives - Assets | 26,168 | 2,119 |
Cash flow hedging derivatives - Liabilities | 198 | 14,341 |
Significant Unobservable Inputs (Level 3) | ' | ' |
Fair Value Assets And Liabilities Measured On Recurring Basis [Line Items] | ' | ' |
Cash flow hedging derivatives - Assets | 0 | 0 |
Cash flow hedging derivatives - Liabilities | $0 | $0 |
COMPREHENSIVE_INCOME_Details
COMPREHENSIVE INCOME (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 |
Other comprehensive income (loss) Pre-Tax Amount: | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Foreign currency translation adjustments | ' | ' | ' | ' | ' | ' | ' | ' | ($26,003) | $7,714 | ($21,213) |
Pension and post-retirement benefit plans | ' | ' | ' | ' | ' | ' | ' | ' | 265,015 | -15,159 | -137,918 |
Cash Flow Hedges: | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Gains (Losses) on cash flow hedging derivatives | ' | ' | ' | ' | ' | ' | ' | ' | 116,329 | -543 | -175,011 |
Reclassification adjustments | ' | ' | ' | ' | ' | ' | ' | ' | 9,365 | 96,993 | -20,282 |
Total other comprehensive income (loss) | ' | ' | ' | ' | ' | ' | ' | ' | 364,706 | 89,005 | -354,424 |
Other comprehensive income (loss) Tax (Expense) Benefit: | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Foreign currency translation adjustments | ' | ' | ' | ' | ' | ' | ' | ' | 0 | 0 | 0 |
Pension and post-retirement benefit plans | ' | ' | ' | ' | ' | ' | ' | ' | -98,612 | 5,525 | 52,095 |
Cash Flow Hedges: | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Gains (Losses) on cash flow hedging derivatives | ' | ' | ' | ' | ' | ' | ' | ' | -43,995 | -325 | 67,298 |
Reclassification adjustments | ' | ' | ' | ' | ' | ' | ' | ' | -3,590 | -36,950 | 7,767 |
Total other comprehensive income (loss) | ' | ' | ' | ' | ' | ' | ' | ' | -146,197 | -31,750 | 127,160 |
Comprehensive income (loss) After-Tax Amount: | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Net Income | 186,075 | 232,985 | 159,504 | 241,906 | 149,879 | 176,716 | 135,685 | 198,651 | 820,470 | 660,931 | 628,962 |
Other Comprehensive Income (Loss) After-Tax Amount: | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Foreign currency translation adjustments | ' | ' | ' | ' | ' | ' | ' | ' | -26,003 | 7,714 | -21,213 |
Pension and postretirement benefit plans | ' | ' | ' | ' | ' | ' | ' | ' | 166,403 | -9,634 | -85,823 |
Cash Flow Hedges: | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Gains (Losses) on cash flow hedging derivatives | ' | ' | ' | ' | ' | ' | ' | ' | 72,334 | -868 | -107,713 |
Reclassification adjustments | ' | ' | ' | ' | ' | ' | ' | ' | 5,775 | 60,043 | -12,515 |
Total other comprehensive income (loss), net of tax | ' | ' | ' | ' | ' | ' | ' | ' | 218,509 | 57,255 | -227,264 |
Comprehensive income | ' | ' | ' | ' | ' | ' | ' | ' | 1,038,979 | 718,186 | 401,698 |
Components of Accumulated Other Comprehensive Income (Loss) Abstract | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Foreign currency translation adjustments | -16,830 | ' | ' | ' | 9,173 | ' | ' | ' | -16,830 | 9,173 | ' |
Pension and post-retirement benefit plans, net of tax | -199,634 | ' | ' | ' | -366,037 | ' | ' | ' | -199,634 | -366,037 | ' |
Cash flow hedges, net of tax | 49,897 | ' | ' | ' | -28,212 | ' | ' | ' | 49,897 | -28,212 | ' |
Total accumulated other comprehensive loss | ($166,567) | ' | ' | ' | ($385,076) | ' | ' | ' | ($166,567) | ($385,076) | ' |
INTEREST_EXPENSE_Details
INTEREST EXPENSE (Details) (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
Interest Expense [Abstract] | ' | ' | ' |
Long-term debt and lease obligations | $84,604 | $81,203 | $85,543 |
Short-term debt | 8,654 | 23,084 | 17,051 |
Capitalized interest | -1,744 | -5,778 | -7,814 |
Interest expense, gross | 91,514 | 98,509 | 94,780 |
Interest income | -3,158 | -2,940 | -2,597 |
Interest expense, net | $88,356 | $95,569 | $92,183 |
SHORTTERM_DEBT_Details
SHORT-TERM DEBT (Details) (USD $) | 12 Months Ended | |||||||
In Millions, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2011 | Dec. 31, 2013 | Dec. 31, 2012 |
Line of Credit [Member] | Line of Credit [Member] | Domestic Line of Credit [Member] | Domestic Line of Credit [Member] | Foreign Line of Credit [Member] | Foreign Line of Credit [Member] | |||
Short-term Debt [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' |
Line of Credit Facility, Maximum Borrowing Capacity | ' | ' | $290.30 | $176.70 | $1,000 | $1,100 | ' | ' |
Line Of Credit Facility Increase Additional Borrowing Capacity | ' | ' | ' | ' | 400 | ' | ' | ' |
Line of Credit Facility, Maximum Amount Outstanding During Period | 166 | ' | ' | ' | ' | ' | ' | ' |
Line of Credit Facility, Amount Outstanding | ' | ' | ' | ' | ' | ' | 166 | 118.2 |
Short-term Debt, Weighted Average Interest Rate | 1.90% | 3.50% | ' | ' | ' | ' | ' | ' |
Line of Credit Facility, Commitment Fee Percentage | 'less than 0.1% | ' | ' | ' | ' | ' | ' | ' |
Contractual Right To Offset Overdrafts | $3.70 | $2.80 | ' | ' | ' | ' | ' | ' |
LONGTERM_DEBT_Details
LONG-TERM DEBT (Details) (USD $) | 12 Months Ended | |
Dec. 31, 2013 | Dec. 31, 2012 | |
Long-term debt [Line Items] | ' | ' |
Long-term Debt | $1,796,056,000 | $1,788,701,000 |
Current portion of long-term debt | 914,000 | 257,734,000 |
Long-term Debt, Excluding Current Maturities | 1,795,142,000 | 1,530,967,000 |
Maturities of Long-term Debt [Abstract] | ' | ' |
Long-term Debt Maturities - 2014 | -914,000 | -257,734,000 |
Long-term Debt Maturities - 2015 | 251,400,000 | ' |
Long-term Debt Maturities - 2016 | 501,300,000 | ' |
Long-term Debt Maturities - 2017 | 900,000 | ' |
Long-term Debt Maturities - 2018 | 400,000 | ' |
5.0% Notes Due 2013 [Member] | ' | ' |
Long-term debt [Line Items] | ' | ' |
Long-term Debt | 0 | 250,000,000 |
Debt Instrument, Interest Rate, Stated Percentage | 5.00% | ' |
Repayments of Long-term Debt | 250,000,000 | ' |
4.85 % Notes Due 2015 [Member] | ' | ' |
Long-term debt [Line Items] | ' | ' |
Long-term Debt | 250,000,000 | 250,000,000 |
5.45 % Notes Due 2016 [Member] | ' | ' |
Long-term debt [Line Items] | ' | ' |
Long-term Debt | 250,000,000 | 250,000,000 |
1.5% Notes Due 2016 [Member] | ' | ' |
Long-term debt [Line Items] | ' | ' |
Long-term Debt | 250,000,000 | 250,000,000 |
4.125% Notes Due 2020 | ' | ' |
Long-term debt [Line Items] | ' | ' |
Long-term Debt | 350,000,000 | 350,000,000 |
8.8 % Debentures Due 2021 [Member] | ' | ' |
Long-term debt [Line Items] | ' | ' |
Long-term Debt | 100,000,000 | 100,000,000 |
2.625% Notes Due 2023 | ' | ' |
Long-term debt [Line Items] | ' | ' |
Long-term Debt | 250,000,000 | 0 |
Debt Instrument, Interest Rate, Stated Percentage | 2.63% | ' |
7.2% Debentures Due 2027 [Member] | ' | ' |
Long-term debt [Line Items] | ' | ' |
Long-term Debt | 250,000,000 | 250,000,000 |
Other Debt Obligations [Member] | ' | ' |
Long-term debt [Line Items] | ' | ' |
Long-term Debt | $96,056,000 | $88,701,000 |
INCOME_TAXES_Details
INCOME TAXES (Details) (USD $) | 12 Months Ended | ||
Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | |
Income Tax Disclosure [Abstract] | ' | ' | ' |
Domestic | $1,252,208,000 | $980,176,000 | $904,418,000 |
Foreign | -889,000 | 35,403,000 | 58,427,000 |
Income before Income Taxes | 1,251,319,000 | 1,015,579,000 | 962,845,000 |
Components of Income Tax Expense (Benefit), Continuing Operations [Abstract] | ' | ' | ' |
Current Federal | 372,649,000 | 299,122,000 | 254,732,000 |
Current State | 47,980,000 | 36,187,000 | 32,174,000 |
Current Foreign | 2,763,000 | 5,554,000 | 13,366,000 |
Current Provision for Income Taxes | 423,392,000 | 340,863,000 | 300,272,000 |
Deferred Federal | 11,334,000 | 5,174,000 | 37,160,000 |
Deferred State | 2,212,000 | 1,897,000 | -1,005,000 |
Deferred Foreign | -6,089,000 | 6,714,000 | -2,544,000 |
Deferred Income Tax Provision (Benefit) | 7,457,000 | 13,785,000 | 33,611,000 |
Total provision for income taxes | 430,849,000 | 354,648,000 | 333,883,000 |
Components of Deferred Tax Assets [Abstract] | ' | ' | ' |
Post-retirement benefit obligations | 101,674,000 | 119,140,000 | ' |
Accrued expenses and other reserves | 119,387,000 | 112,760,000 | ' |
Stock-based compensation | 47,324,000 | 51,388,000 | ' |
Derivative instruments | 0 | 23,822,000 | ' |
Pension | 0 | 72,374,000 | ' |
Lease financing obligation | 19,065,000 | 19,035,000 | ' |
Accrued trade promotion reserves | 39,234,000 | 30,594,000 | ' |
Net operating loss carryforwards | 39,606,000 | 48,455,000 | ' |
Other | 11,754,000 | 3,643,000 | ' |
Gross deferred tax assets | 378,044,000 | 481,211,000 | ' |
Valuation Allowance | -87,159,000 | -74,021,000 | ' |
Total deferred tax assets | 290,885,000 | 407,190,000 | ' |
Components of Deferred Tax Liabilities [Abstract] | ' | ' | ' |
Property, plant and equipment, net | 201,224,000 | 210,406,000 | ' |
Acquired intangibles | 64,249,000 | 63,585,000 | ' |
Inventories | 33,885,000 | 23,335,000 | ' |
Derivatives instruments | 33,779,000 | 0 | ' |
Pension | 8,037,000 | 0 | ' |
Other | 1,404,000 | 10,849,000 | ' |
Deferred Tax Liabilities, Gross | 342,578,000 | 308,175,000 | ' |
Components of Deferred Tax Assets and Liabilities [Abstract] | ' | ' | ' |
Current deferred tax assets, net | 52,511,000 | 122,224,000 | ' |
Non-current deferred tax assets, net | 0 | 12,448,000 | ' |
Non- current deferred tax liabilities, net | -104,204,000 | -35,657,000 | ' |
Net deferred tax (liabilities) assets | -51,693,000 | 99,015,000 | ' |
Effective Income Tax Rate, Continuing Operations, Tax Rate Reconciliation [Abstract] | ' | ' | ' |
Federal Statutory Income Tax Rate | 35.00% | 35.00% | 35.00% |
State income taxes, net of Federal income tax benefits | 2.80% | 3.20% | 2.40% |
Qualified production income deduction | -2.60% | -2.50% | -2.20% |
Business realignment and impairment charges and gain on sale of trademark licensing rights | 0.10% | 0.20% | -0.10% |
International operations | -0.40% | -0.10% | -0.60% |
Other, net | -0.50% | -0.90% | 0.20% |
Effective Income Tax Rate | 34.40% | 34.90% | 34.70% |
Reconciliation of Unrecognized Tax Benefits, Excluding Amounts Pertaining to Examined Tax Returns [Roll Forward] | ' | ' | ' |
Balance at the Beginning of the Year | 51,520,000 | 53,553,000 | ' |
Additions for tax positions taken during prior years | 58,246,000 | 11,335,000 | ' |
Reductions for tax positions taken during prior years | -5,776,000 | -5,478,000 | ' |
Additions for tax positions taken during the current year | 5,523,000 | 5,750,000 | ' |
Settlements | 0 | -5,234,000 | ' |
Expiration of Statute of Limitations | -5,550,000 | -8,406,000 | ' |
Balance at the End of the Year | 103,963,000 | 51,520,000 | 53,553,000 |
Gain on sale of trademark licensing rights, before tax | ' | 17,000,000 | ' |
Employee Service Share-based Compensation, Tax Benefit Realized from Exercise of Stock Options | 48,800,000 | 30,200,000 | ' |
Unrecognized Tax Benefits that Would Impact Effective Tax Rate | 31,700,000 | 30,800,000 | ' |
Unrecognized Tax Benefits, Income Tax Penalties and Interest Expense | 15,400,000 | 5,300,000 | 300,000 |
Unrecognized Tax Benefits, Income Tax Penalties and Interest Accrued | 23,700,000 | 8,400,000 | ' |
Accrued Income Taxes | 70,600,000 | ' | ' |
Income Taxes Receivable, Noncurrent | 63,900,000 | ' | ' |
Reduction in liability for unrecognized tax benefits | 81,200,000 | ' | ' |
Undistributed Earnings of Foreign Subsidiaries | $121,300,000 | ' | ' |
PENSION_AND_OTHER_POSTRETIREME2
PENSION AND OTHER POST-RETIREMENT BENEFIT PLANS (Details) (USD $) | 12 Months Ended | ||
Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | |
Defined Benefit Plan Disclosure [Line Items] | ' | ' | ' |
Defined Benefit Plan Historic Geometric Average Return On Plan Assets Over Prior 26 Years | 8.70% | ' | ' |
Settlement Loss Amount Associated to Business Realignment Initiatives | ' | '15.8 | ' |
Defined Benefit Plan, Accumulated Benefit Obligation | $1,100,000,000 | $1,200,000,000 | ' |
Defined Benefit Plan, Minimum Funding Requirement | 3,600,000 | ' | ' |
Defined Benefit Plan, Change in Fair Value of Plan Assets [Roll Forward] | ' | ' | ' |
Fair Value of Plan Assets at Beginning of Year | 988,167,000 | ' | ' |
Employer Contributions | 32,300,000 | 21,400,000 | ' |
Defined Benefit Plan, Voluntary Employer Contributions | ' | 25,000,000 | ' |
Fair Value of Plan Assets at End of Year | 1,091,985,000 | 988,167,000 | ' |
Defined Benefit Plan, Accumulated Other Comprehensive Income (Loss), after Tax [Abstract] | ' | ' | ' |
Total | 199,634,000 | 366,037,000 | ' |
Defined Benefit Plan, Pension Plans with Accumulated Benefit Obligations in Excess of Plan Assets [Abstract] | ' | ' | ' |
Projected Benefit Obligation | 76,801,000 | 1,237,238,000 | ' |
Accumulated Benefit Obligation | 64,340,000 | 1,185,214,000 | ' |
Fair Value of Plan Assets | 15,760,000 | 987,643,000 | ' |
Defined Benefit Plan, Weighted Average Assumptions Used in Calculating Benefit Obligation [Abstract] | ' | ' | ' |
Discount Rate | 4.50% | 3.70% | ' |
Defined Benefit Plan, Health Care Cost Trend Rate Assumed for Next Fiscal Year | 8.50% | 9.10% | ' |
Defined Benefit Plan, Ultimate Health Care Cost Trend Rate | 5.00% | 5.00% | ' |
Defined Benefit Plan, Weighted Average Assumptions Used in Calculating Net Periodic Benefit Cost [Abstract] | ' | ' | ' |
Expected Long-term Return on Assets | 7.75% | 8.00% | 8.00% |
Change in Expected Rate of Return on Plan Assets | 7.00% | ' | ' |
Defined Benefit Plan, Effect of One-Percentage Point Change in Assumed Health Care Cost Trend Rates [Abstract] | ' | ' | ' |
Defined Benefit Plan, Effect of One Percentage Point Increase on Service and Interest Cost Components | 172,000 | ' | ' |
Defined Benefit Plan, Effect of One Percentage Point Increase on Accumulated Postretirement Benefit Obligation | 4,132,000 | ' | ' |
Defined Benefit Plan, Effect of One Percentage Point Decrease on Accumulated Postretirement Benefit Obligation | -3,697,000 | ' | ' |
Defined Benefit Plan, Effect of One Percentage Point Decrease on Service and Interest Cost Components | -152,000 | ' | ' |
Pension and Other Postretirement Benefit Plans, Amounts that Will be Amortized from Accumulated Other Comprehensive Income (Loss) in Next Fiscal Year [Abstract] | ' | ' | ' |
Defined Benefit Plan, Amortization of Net Gains (Losses) | -109,000 | ' | ' |
Defined Benefit Plan, Amortization of Net Prior Service Cost (Credit) | 618,000 | ' | ' |
Multiemployer Plans [Abstract] | ' | ' | ' |
Multiemployer Pension Plan Number of Participants | 110 | ' | ' |
Defined Benefit Plan, Estimated Future Employer Contributions in Next Fiscal Year | 22,000,000 | ' | ' |
Fair Value, Inputs, Level 1 [Member] | ' | ' | ' |
Defined Benefit Plan, Change in Fair Value of Plan Assets [Roll Forward] | ' | ' | ' |
Fair Value of Plan Assets at End of Year | 799,363,000 | 739,344,000 | ' |
Fair Value, Inputs, Level 2 [Member] | ' | ' | ' |
Defined Benefit Plan, Change in Fair Value of Plan Assets [Roll Forward] | ' | ' | ' |
Fair Value of Plan Assets at End of Year | 292,622,000 | 248,823,000 | ' |
Fair Value, Inputs, Level 3 [Member] | ' | ' | ' |
Defined Benefit Plan, Change in Fair Value of Plan Assets [Roll Forward] | ' | ' | ' |
Fair Value of Plan Assets at End of Year | 0 | 0 | ' |
Cash and Cash Equivalents [Member] | ' | ' | ' |
Defined Benefit Plan, Change in Fair Value of Plan Assets [Roll Forward] | ' | ' | ' |
Fair Value of Plan Assets at Beginning of Year | 34,960,000 | ' | ' |
Fair Value of Plan Assets at End of Year | 23,655,000 | ' | ' |
Defined Benefit Plan, Assets, Target Allocations [Abstract] | ' | ' | ' |
Defined Benefit Plan, Target Plan Asset Allocations Range Maximum | 5.00% | ' | ' |
Defined Benefit Plan, Target Plan Asset Allocations Range Minimum | 0.00% | ' | ' |
Cash and Cash Equivalents [Member] | Fair Value, Inputs, Level 1 [Member] | ' | ' | ' |
Defined Benefit Plan, Change in Fair Value of Plan Assets [Roll Forward] | ' | ' | ' |
Fair Value of Plan Assets at End of Year | 657,000 | 933,000 | ' |
Cash and Cash Equivalents [Member] | Fair Value, Inputs, Level 2 [Member] | ' | ' | ' |
Defined Benefit Plan, Change in Fair Value of Plan Assets [Roll Forward] | ' | ' | ' |
Fair Value of Plan Assets at End of Year | 22,998,000 | 34,027,000 | ' |
Cash and Cash Equivalents [Member] | Fair Value, Inputs, Level 3 [Member] | ' | ' | ' |
Defined Benefit Plan, Change in Fair Value of Plan Assets [Roll Forward] | ' | ' | ' |
Fair Value of Plan Assets at End of Year | 0 | 0 | ' |
Equity Securities [Member] | ' | ' | ' |
Defined Benefit Plan, Assets, Target Allocations [Abstract] | ' | ' | ' |
Defined Benefit Plan, Target Plan Asset Allocations Range Maximum | 75.00% | ' | ' |
Defined Benefit Plan, Target Plan Asset Allocations Range Minimum | 55.00% | ' | ' |
U.S. all-cap [Member] | ' | ' | ' |
Defined Benefit Plan, Change in Fair Value of Plan Assets [Roll Forward] | ' | ' | ' |
Fair Value of Plan Assets at End of Year | 202,334,000 | 154,698,000 | ' |
U.S. all-cap [Member] | Fair Value, Inputs, Level 1 [Member] | ' | ' | ' |
Defined Benefit Plan, Change in Fair Value of Plan Assets [Roll Forward] | ' | ' | ' |
Fair Value of Plan Assets at End of Year | 64,949,000 | 50,596,000 | ' |
U.S. all-cap [Member] | Fair Value, Inputs, Level 2 [Member] | ' | ' | ' |
Defined Benefit Plan, Change in Fair Value of Plan Assets [Roll Forward] | ' | ' | ' |
Fair Value of Plan Assets at End of Year | 137,385,000 | 104,102,000 | ' |
U.S. all-cap [Member] | Fair Value, Inputs, Level 3 [Member] | ' | ' | ' |
Defined Benefit Plan, Change in Fair Value of Plan Assets [Roll Forward] | ' | ' | ' |
Fair Value of Plan Assets at End of Year | 0 | 0 | ' |
U.S. large-cap [Member] | ' | ' | ' |
Defined Benefit Plan, Change in Fair Value of Plan Assets [Roll Forward] | ' | ' | ' |
Fair Value of Plan Assets at End of Year | 144,254,000 | 107,934,000 | ' |
U.S. large-cap [Member] | Fair Value, Inputs, Level 1 [Member] | ' | ' | ' |
Defined Benefit Plan, Change in Fair Value of Plan Assets [Roll Forward] | ' | ' | ' |
Fair Value of Plan Assets at End of Year | 144,254,000 | 107,934,000 | ' |
U.S. large-cap [Member] | Fair Value, Inputs, Level 2 [Member] | ' | ' | ' |
Defined Benefit Plan, Change in Fair Value of Plan Assets [Roll Forward] | ' | ' | ' |
Fair Value of Plan Assets at End of Year | 0 | 0 | ' |
U.S. large-cap [Member] | Fair Value, Inputs, Level 3 [Member] | ' | ' | ' |
Defined Benefit Plan, Change in Fair Value of Plan Assets [Roll Forward] | ' | ' | ' |
Fair Value of Plan Assets at End of Year | 0 | 0 | ' |
U.S. small/mid cap [Member] | ' | ' | ' |
Defined Benefit Plan, Change in Fair Value of Plan Assets [Roll Forward] | ' | ' | ' |
Fair Value of Plan Assets at End of Year | 33,145,000 | 24,816,000 | ' |
U.S. small/mid cap [Member] | Fair Value, Inputs, Level 1 [Member] | ' | ' | ' |
Defined Benefit Plan, Change in Fair Value of Plan Assets [Roll Forward] | ' | ' | ' |
Fair Value of Plan Assets at End of Year | 33,145,000 | 24,816,000 | ' |
U.S. small/mid cap [Member] | Fair Value, Inputs, Level 2 [Member] | ' | ' | ' |
Defined Benefit Plan, Change in Fair Value of Plan Assets [Roll Forward] | ' | ' | ' |
Fair Value of Plan Assets at End of Year | 0 | 0 | ' |
U.S. small/mid cap [Member] | Fair Value, Inputs, Level 3 [Member] | ' | ' | ' |
Defined Benefit Plan, Change in Fair Value of Plan Assets [Roll Forward] | ' | ' | ' |
Fair Value of Plan Assets at End of Year | 0 | 0 | ' |
International all-cap [Member] | ' | ' | ' |
Defined Benefit Plan, Change in Fair Value of Plan Assets [Roll Forward] | ' | ' | ' |
Fair Value of Plan Assets at End of Year | 139,954,000 | 114,772,000 | ' |
International all-cap [Member] | Fair Value, Inputs, Level 1 [Member] | ' | ' | ' |
Defined Benefit Plan, Change in Fair Value of Plan Assets [Roll Forward] | ' | ' | ' |
Fair Value of Plan Assets at End of Year | 136,892,000 | 111,834,000 | ' |
International all-cap [Member] | Fair Value, Inputs, Level 2 [Member] | ' | ' | ' |
Defined Benefit Plan, Change in Fair Value of Plan Assets [Roll Forward] | ' | ' | ' |
Fair Value of Plan Assets at End of Year | 3,062,000 | 2,938,000 | ' |
International all-cap [Member] | Fair Value, Inputs, Level 3 [Member] | ' | ' | ' |
Defined Benefit Plan, Change in Fair Value of Plan Assets [Roll Forward] | ' | ' | ' |
Fair Value of Plan Assets at End of Year | 0 | 0 | ' |
Global all-cap [Member] | ' | ' | ' |
Defined Benefit Plan, Change in Fair Value of Plan Assets [Roll Forward] | ' | ' | ' |
Fair Value of Plan Assets at End of Year | 181,702,000 | 229,044,000 | ' |
Global all-cap [Member] | Fair Value, Inputs, Level 1 [Member] | ' | ' | ' |
Defined Benefit Plan, Change in Fair Value of Plan Assets [Roll Forward] | ' | ' | ' |
Fair Value of Plan Assets at End of Year | 181,702,000 | 229,044,000 | ' |
Global all-cap [Member] | Fair Value, Inputs, Level 2 [Member] | ' | ' | ' |
Defined Benefit Plan, Change in Fair Value of Plan Assets [Roll Forward] | ' | ' | ' |
Fair Value of Plan Assets at End of Year | 0 | 0 | ' |
Global all-cap [Member] | Fair Value, Inputs, Level 3 [Member] | ' | ' | ' |
Defined Benefit Plan, Change in Fair Value of Plan Assets [Roll Forward] | ' | ' | ' |
Fair Value of Plan Assets at End of Year | 0 | 0 | ' |
Domestic real estate [Member] | ' | ' | ' |
Defined Benefit Plan, Change in Fair Value of Plan Assets [Roll Forward] | ' | ' | ' |
Fair Value of Plan Assets at End of Year | ' | 24,892,000 | ' |
Domestic real estate [Member] | Fair Value, Inputs, Level 1 [Member] | ' | ' | ' |
Defined Benefit Plan, Change in Fair Value of Plan Assets [Roll Forward] | ' | ' | ' |
Fair Value of Plan Assets at End of Year | ' | 24,892,000 | ' |
Domestic real estate [Member] | Fair Value, Inputs, Level 2 [Member] | ' | ' | ' |
Defined Benefit Plan, Change in Fair Value of Plan Assets [Roll Forward] | ' | ' | ' |
Fair Value of Plan Assets at End of Year | ' | 0 | ' |
Domestic real estate [Member] | Fair Value, Inputs, Level 3 [Member] | ' | ' | ' |
Defined Benefit Plan, Change in Fair Value of Plan Assets [Roll Forward] | ' | ' | ' |
Fair Value of Plan Assets at End of Year | ' | 0 | ' |
Debt Securities [Member] | ' | ' | ' |
Defined Benefit Plan, Assets, Target Allocations [Abstract] | ' | ' | ' |
Defined Benefit Plan, Target Plan Asset Allocations Range Maximum | 45.00% | ' | ' |
Defined Benefit Plan, Target Plan Asset Allocations Range Minimum | 25.00% | ' | ' |
U.S. government/agency [Member] | ' | ' | ' |
Defined Benefit Plan, Change in Fair Value of Plan Assets [Roll Forward] | ' | ' | ' |
Fair Value of Plan Assets at End of Year | 144,902,000 | 103,993,000 | ' |
U.S. government/agency [Member] | Fair Value, Inputs, Level 1 [Member] | ' | ' | ' |
Defined Benefit Plan, Change in Fair Value of Plan Assets [Roll Forward] | ' | ' | ' |
Fair Value of Plan Assets at End of Year | 109,995,000 | 76,009,000 | ' |
U.S. government/agency [Member] | Fair Value, Inputs, Level 2 [Member] | ' | ' | ' |
Defined Benefit Plan, Change in Fair Value of Plan Assets [Roll Forward] | ' | ' | ' |
Fair Value of Plan Assets at End of Year | 34,907,000 | 27,984,000 | ' |
U.S. government/agency [Member] | Fair Value, Inputs, Level 3 [Member] | ' | ' | ' |
Defined Benefit Plan, Change in Fair Value of Plan Assets [Roll Forward] | ' | ' | ' |
Fair Value of Plan Assets at End of Year | 0 | 0 | ' |
Corporate bonds [Member] | ' | ' | ' |
Defined Benefit Plan, Change in Fair Value of Plan Assets [Roll Forward] | ' | ' | ' |
Fair Value of Plan Assets at End of Year | 92,351,000 | 57,692,000 | ' |
Corporate bonds [Member] | Fair Value, Inputs, Level 1 [Member] | ' | ' | ' |
Defined Benefit Plan, Change in Fair Value of Plan Assets [Roll Forward] | ' | ' | ' |
Fair Value of Plan Assets at End of Year | 57,735,000 | 38,001,000 | ' |
Corporate bonds [Member] | Fair Value, Inputs, Level 2 [Member] | ' | ' | ' |
Defined Benefit Plan, Change in Fair Value of Plan Assets [Roll Forward] | ' | ' | ' |
Fair Value of Plan Assets at End of Year | 34,616,000 | 19,691,000 | ' |
Corporate bonds [Member] | Fair Value, Inputs, Level 3 [Member] | ' | ' | ' |
Defined Benefit Plan, Change in Fair Value of Plan Assets [Roll Forward] | ' | ' | ' |
Fair Value of Plan Assets at End of Year | 0 | 0 | ' |
Collateralized obligations [Member] | ' | ' | ' |
Defined Benefit Plan, Change in Fair Value of Plan Assets [Roll Forward] | ' | ' | ' |
Fair Value of Plan Assets at End of Year | 78,366,000 | 88,865,000 | ' |
Collateralized obligations [Member] | Fair Value, Inputs, Level 1 [Member] | ' | ' | ' |
Defined Benefit Plan, Change in Fair Value of Plan Assets [Roll Forward] | ' | ' | ' |
Fair Value of Plan Assets at End of Year | 56,016,000 | 61,853,000 | ' |
Collateralized obligations [Member] | Fair Value, Inputs, Level 2 [Member] | ' | ' | ' |
Defined Benefit Plan, Change in Fair Value of Plan Assets [Roll Forward] | ' | ' | ' |
Fair Value of Plan Assets at End of Year | 22,350,000 | 27,012,000 | ' |
Collateralized obligations [Member] | Fair Value, Inputs, Level 3 [Member] | ' | ' | ' |
Defined Benefit Plan, Change in Fair Value of Plan Assets [Roll Forward] | ' | ' | ' |
Fair Value of Plan Assets at End of Year | 0 | 0 | ' |
International government/corporate bonds [Member] | ' | ' | ' |
Defined Benefit Plan, Change in Fair Value of Plan Assets [Roll Forward] | ' | ' | ' |
Fair Value of Plan Assets at End of Year | 51,322,000 | 46,501,000 | ' |
International government/corporate bonds [Member] | Fair Value, Inputs, Level 1 [Member] | ' | ' | ' |
Defined Benefit Plan, Change in Fair Value of Plan Assets [Roll Forward] | ' | ' | ' |
Fair Value of Plan Assets at End of Year | 14,018,000 | 13,432,000 | ' |
International government/corporate bonds [Member] | Fair Value, Inputs, Level 2 [Member] | ' | ' | ' |
Defined Benefit Plan, Change in Fair Value of Plan Assets [Roll Forward] | ' | ' | ' |
Fair Value of Plan Assets at End of Year | 37,304,000 | 33,069,000 | ' |
International government/corporate bonds [Member] | Fair Value, Inputs, Level 3 [Member] | ' | ' | ' |
Defined Benefit Plan, Change in Fair Value of Plan Assets [Roll Forward] | ' | ' | ' |
Fair Value of Plan Assets at End of Year | 0 | 0 | ' |
Pension Benefits | ' | ' | ' |
Defined Benefit Plan, Change in Fair Value of Plan Assets [Roll Forward] | ' | ' | ' |
Fair Value of Plan Assets at Beginning of Year | 988,167,000 | 961,421,000 | ' |
Actual Return on Plan Assets | 152,976,000 | 118,073,000 | ' |
Employer Contributions | 32,336,000 | 21,371,000 | ' |
Settlement | -319,000 | -49,876,000 | ' |
Currency Translation and Other | -4,533,000 | 1,617,000 | ' |
Fair Value of Plan Assets at End of Year | 1,091,985,000 | 988,167,000 | 961,421,000 |
Funded Status at End of Year | -28,507,000 | -249,611,000 | ' |
Defined Benefit Plan, Amounts Recognized in Balance Sheet [Abstract] | ' | ' | ' |
Defined Benefit Plan, Assets for Plan Benefits, Noncurrent | 32,533,000 | 0 | ' |
Accrued Liabilities | -10,198,000 | -9,396,000 | ' |
Other Long-Term Liabilities | -50,842,000 | -240,215,000 | ' |
Total | -28,507,000 | -249,611,000 | ' |
Defined Benefit Plan, Accumulated Other Comprehensive Income (Loss), after Tax [Abstract] | ' | ' | ' |
Actuarial Net (Loss) | -215,702,000 | -362,039,000 | ' |
Net Prior Service Credit (Cost) | 5,698,000 | 5,539,000 | ' |
Total | -210,004,000 | -356,500,000 | ' |
Defined Benefit Plan, Amounts Recognized in Other Comprehensive Income (Loss) [Abstract] | ' | ' | ' |
Actuarial Net Loss (Gain) | -230,605,000 | 8,536,000 | 120,401,000 |
Prior Service (Credit) Cost | -613,000 | -716,000 | -1,313,000 |
Total Recognized in Other Comprehensive Loss (Income) | -231,218,000 | 7,820,000 | 119,088,000 |
Total Recognized In Net Periodic Benefit Cost In Income And Other Comprehensive Income Loss | -187,534,000 | 56,602,000 | 153,605,000 |
Defined Benefit Plan, Change in Benefit Obligation [Roll Forward] | ' | ' | ' |
Projected Benefit Obligation at Beginning of Year | 1,237,778,000 | 1,156,756,000 | ' |
Service cost | 31,339,000 | 30,823,000 | 30,059,000 |
Interest cost | 43,962,000 | 49,909,000 | 52,960,000 |
Plan Amendments | 55,000 | 2,000 | ' |
Defined Benefit Plan, Actuarial Gain (Loss) | -100,872,000 | 112,700,000 | ' |
Curtailments | -8,833,000 | 0 | ' |
Settlement | -319,000 | -49,876,000 | ' |
Currency Translation and Other | -5,976,000 | 1,903,000 | ' |
Benefits Paid | -76,642,000 | -64,439,000 | ' |
Projected Benefit Obligation at End of Year | 1,120,492,000 | 1,237,778,000 | 1,156,756,000 |
Defined Benefit Plan, Weighted Average Assumptions Used in Calculating Benefit Obligation [Abstract] | ' | ' | ' |
Discount Rate | 4.50% | 3.70% | ' |
Rate of Compensation Increase | 4.00% | 4.00% | ' |
Defined Benefit Plan, Weighted Average Assumptions Used in Calculating Net Periodic Benefit Cost [Abstract] | ' | ' | ' |
Discount Rate | 3.70% | 4.50% | ' |
Expected Long-term Return on Assets | 7.75% | 8.00% | 8.00% |
Rate of Compensation Increase | 4.00% | 4.10% | 4.10% |
Defined Benefit Plan, Net Periodic Benefit Cost [Abstract] | ' | ' | ' |
Expected return on plan assets | -73,128,000 | -72,949,000 | -78,161,000 |
Amortization of prior service cost | 422,000 | 731,000 | 1,002,000 |
Defined Benefit Plan, Amortization of Gains (Losses) | -40,397,000 | -39,723,000 | -28,004,000 |
Administrative expenses | 692,000 | 545,000 | 653,000 |
Net periodic benefit cost (income) | 43,684,000 | 48,782,000 | 34,517,000 |
Curtailment loss (credit) | -364,000 | 0 | 1,826,000 |
Settlement loss | 18,000 | 19,676,000 | 46,000 |
Total amount reflected in earnings | 43,338,000 | 68,458,000 | 36,389,000 |
Defined Benefit Plan, Expected Future Benefit Payments, Fiscal Year Maturity [Abstract] | ' | ' | ' |
2014 | 67,617,000 | ' | ' |
2015 | 64,641,000 | ' | ' |
2016 | 69,085,000 | ' | ' |
2017 | 101,765,000 | ' | ' |
2018 | 83,559,000 | ' | ' |
2019-2023 | 544,322,000 | ' | ' |
Pension and Other Postretirement Benefit Plans, Amounts that Will be Amortized from Accumulated Other Comprehensive Income (Loss) in Next Fiscal Year [Abstract] | ' | ' | ' |
Defined Benefit Plan, Amortization of Net Gains (Losses) | -22,952,000 | ' | ' |
Defined Benefit Plan, Amortization of Net Prior Service Cost (Credit) | -668,000 | ' | ' |
Other Benefits | ' | ' | ' |
Defined Benefit Plan, Change in Fair Value of Plan Assets [Roll Forward] | ' | ' | ' |
Fair Value of Plan Assets at Beginning of Year | 0 | 0 | ' |
Actual Return on Plan Assets | 0 | 0 | ' |
Employer Contributions | 24,877,000 | 22,837,000 | ' |
Settlement | 0 | 0 | ' |
Currency Translation and Other | 0 | 0 | ' |
Fair Value of Plan Assets at End of Year | 0 | 0 | 0 |
Funded Status at End of Year | -270,937,000 | -318,415,000 | ' |
Defined Benefit Plan, Amounts Recognized in Balance Sheet [Abstract] | ' | ' | ' |
Defined Benefit Plan, Assets for Plan Benefits, Noncurrent | 0 | 0 | ' |
Accrued Liabilities | -25,477,000 | -26,181,000 | ' |
Other Long-Term Liabilities | -245,460,000 | -292,234,000 | ' |
Total | -270,937,000 | -318,415,000 | ' |
Defined Benefit Plan, Accumulated Other Comprehensive Income (Loss), after Tax [Abstract] | ' | ' | ' |
Actuarial Net (Loss) | 13,107,000 | -6,320,000 | ' |
Net Prior Service Credit (Cost) | -2,737,000 | -3,217,000 | ' |
Total | 10,370,000 | -9,537,000 | ' |
Defined Benefit Plan, Amounts Recognized in Other Comprehensive Income (Loss) [Abstract] | ' | ' | ' |
Actuarial Net Loss (Gain) | -33,165,000 | 7,952,000 | 11,216,000 |
Prior Service (Credit) Cost | -632,000 | -613,000 | 7,614,000 |
Total Recognized in Other Comprehensive Loss (Income) | -33,797,000 | 7,339,000 | 18,830,000 |
Total Recognized In Net Periodic Benefit Cost In Income And Other Comprehensive Income Loss | -21,336,000 | 22,407,000 | 35,048,000 |
Defined Benefit Plan, Change in Benefit Obligation [Roll Forward] | ' | ' | ' |
Projected Benefit Obligation at Beginning of Year | 318,415,000 | 318,536,000 | ' |
Service cost | 1,094,000 | 1,172,000 | 1,333,000 |
Interest cost | 10,747,000 | 13,258,000 | 14,967,000 |
Plan Amendments | 0 | 0 | ' |
Defined Benefit Plan, Actuarial Gain (Loss) | -33,412,000 | 7,916,000 | ' |
Curtailments | 0 | 0 | ' |
Settlement | 0 | 0 | ' |
Currency Translation and Other | -1,030,000 | 370,000 | ' |
Benefits Paid | -24,877,000 | -22,837,000 | ' |
Projected Benefit Obligation at End of Year | 270,937,000 | 318,415,000 | 318,536,000 |
Defined Benefit Plan, Weighted Average Assumptions Used in Calculating Net Periodic Benefit Cost [Abstract] | ' | ' | ' |
Discount Rate | 3.70% | 4.50% | 5.20% |
Defined Benefit Plan, Net Periodic Benefit Cost [Abstract] | ' | ' | ' |
Expected return on plan assets | 0 | 0 | 0 |
Amortization of prior service cost | 618,000 | 619,000 | -255,000 |
Defined Benefit Plan, Amortization of Gains (Losses) | 73,000 | 101,000 | 71,000 |
Administrative expenses | 75,000 | 120,000 | 244,000 |
Net periodic benefit cost (income) | 12,461,000 | 15,068,000 | 16,218,000 |
Curtailment loss (credit) | 0 | 0 | -174,000 |
Settlement loss | 0 | 0 | 0 |
Total amount reflected in earnings | 12,461,000 | 15,068,000 | 16,044,000 |
Defined Benefit Plan, Expected Future Benefit Payments, Fiscal Year Maturity [Abstract] | ' | ' | ' |
2014 | 25,491,000 | ' | ' |
2015 | 24,690,000 | ' | ' |
2016 | 23,796,000 | ' | ' |
2017 | 22,411,000 | ' | ' |
2018 | 20,843,000 | ' | ' |
2019-2023 | $85,699,000 | ' | ' |
SAVINGS_PLANS_SAVINGS_PLAN_Det
SAVINGS PLANS SAVINGS PLAN (Details) (USD $) | 12 Months Ended | ||
In Millions, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
Savings Plans [Abstract] | ' | ' | ' |
Defined Contribution Plan, Cost Recognized | $43.30 | $39.80 | $35.80 |
CAPITAL_STOCK_AND_NET_INCOME_P2
CAPITAL STOCK AND NET INCOME PER SHARE (Details) (USD $) | 3 Months Ended | 12 Months Ended | |||||||||
In Thousands, except 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 |
Capital Stock and Net Income Per Share [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Capital Stock, Shares Authorized | 1,055,000,000 | ' | ' | ' | ' | ' | ' | ' | 1,055,000,000 | ' | ' |
Preferred Stock, Shares Authorized | 5,000,000 | ' | ' | ' | ' | ' | ' | ' | 5,000,000 | ' | ' |
Common Stock, Shares, Outstanding | 223,894,721 | ' | ' | ' | 223,786,030 | ' | ' | ' | 223,894,721 | 223,786,030 | 225,205,918 |
Stock options excluded from diluted earnings per share calculation because the effect would have been antidilutive | ' | ' | ' | ' | ' | ' | ' | ' | 1,800,000 | 3,500,000 | 6,900,000 |
Approximate Percentage Of Total Votes Held By Trustee | 80.00% | ' | ' | ' | ' | ' | ' | ' | 80.00% | ' | ' |
Schedule Of Changes In Outstanding Common Stock [Abstract] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Common Stock, Shares, Issued | 359,901,744 | ' | ' | ' | 359,901,744 | ' | ' | ' | 359,901,744 | 359,901,744 | 359,901,744 |
Treasury Shares at Beginning of Year | ' | ' | ' | -136,115,714 | ' | ' | ' | -134,695,826 | -136,115,714 | -134,695,826 | -132,871,512 |
Repurchase Programs | 0 | ' | ' | ' | -2,054,354 | ' | ' | ' | 0 | -2,054,354 | -1,902,753 |
Stock-Based Compensation Programs, Shares Repurchased | ' | ' | ' | ' | ' | ' | ' | ' | -3,655,830 | -5,598,537 | -5,179,028 |
Stock-Based Compensation Programs, Shares Issued | ' | ' | ' | ' | ' | ' | ' | ' | 3,764,521 | 6,233,003 | 5,257,467 |
Treasury Shares at End of Year | -136,007,023 | ' | ' | ' | -136,115,714 | ' | ' | ' | -136,007,023 | -136,115,714 | -134,695,826 |
Common Stock, Shares, Outstanding | 223,894,721 | ' | ' | ' | 223,786,030 | ' | ' | ' | 223,894,721 | 223,786,030 | 225,205,918 |
Earnings Per Share, Basic and Diluted [Abstract] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Net Income | ' | ' | ' | ' | ' | ' | ' | ' | $820,470 | $660,931 | $628,962 |
Total weighted-average shares - Basic | ' | ' | ' | ' | ' | ' | ' | ' | 224,176,000 | 225,036,000 | 226,574,000 |
Weighted-average shares - Diluted | ' | ' | ' | ' | ' | ' | ' | ' | 227,203,000 | 228,337,000 | 229,919,000 |
Common Stock | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Capital Stock and Net Income Per Share [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Capital Stock, Shares Authorized | 900,000,000 | ' | ' | ' | ' | ' | ' | ' | 900,000,000 | ' | ' |
Number Of Shares Held By Hershey Trust Company | 12,902,721 | ' | ' | ' | ' | ' | ' | ' | 12,902,721 | ' | ' |
Schedule Of Changes In Outstanding Common Stock [Abstract] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Common Stock, Shares, Issued | 299,281,527 | ' | ' | ' | 299,272,927 | ' | ' | ' | 299,281,527 | 299,272,927 | ' |
Earnings Per Share, Basic and Diluted [Abstract] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Weighted Average Number Of Shares Outstanding - Basic | ' | ' | ' | ' | ' | ' | ' | ' | 163,549,000 | 164,406,000 | 165,929,000 |
Earnings Per Share - Basic | $0.85 | $1.07 | $0.73 | $1.11 | $0.69 | $0.80 | $0.62 | $0.91 | $3.76 | $3.01 | $2.85 |
Earnings Per Share - Diluted | $0.82 | $1.03 | $0.70 | $1.06 | $0.66 | $0.77 | $0.59 | $0.87 | $3.61 | $2.89 | $2.74 |
Common Class B | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Capital Stock and Net Income Per Share [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Capital Stock, Shares Authorized | 150,000,000 | ' | ' | ' | ' | ' | ' | ' | 150,000,000 | ' | ' |
Conversion of Stock, Shares Converted | ' | ' | ' | ' | ' | ' | ' | ' | 8,600 | 3,225 | 74,377 |
Number Of Shares Held By Hershey Trust Company | 60,612,012 | ' | ' | ' | ' | ' | ' | ' | 60,612,012 | ' | ' |
Schedule Of Changes In Outstanding Common Stock [Abstract] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Common Stock, Shares, Issued | 60,620,217 | ' | ' | ' | 60,628,817 | ' | ' | ' | 60,620,217 | 60,628,817 | ' |
Earnings Per Share, Basic and Diluted [Abstract] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Weighted Average Number Of Shares Outstanding - Basic | ' | ' | ' | ' | ' | ' | ' | ' | 60,627,000 | 60,630,000 | 60,645,000 |
Earnings Per Share - Basic | $0.77 | $0.96 | $0.66 | $1 | $0.62 | $0.73 | $0.56 | $0.82 | $3.39 | $2.73 | $2.58 |
Earnings Per Share - Diluted | $0.76 | $0.95 | $0.66 | $0.99 | $0.62 | $0.73 | $0.55 | $0.81 | $3.37 | $2.71 | $2.56 |
Employee stock options [Member] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Earnings Per Share, Basic and Diluted [Abstract] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Effect of dilutive securities - Stock Options | ' | ' | ' | ' | ' | ' | ' | ' | 2,476,000 | 2,608,000 | 2,565,000 |
Performance and restricted stock units [Member] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Earnings Per Share, Basic and Diluted [Abstract] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Effect of dilutive securities - Performance and restrictive stock units | ' | ' | ' | ' | ' | ' | ' | ' | 551,000 | 693,000 | 780,000 |
STOCK_COMPENSATION_PLAN_Detail
STOCK COMPENSATION PLAN (Details) (USD $) | 12 Months Ended | ||
Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | |
Stock Options: | ' | ' | ' |
Share-based Compensation Arrangement by Share-based Payment Award, Number of Shares Authorized | 68,500,000 | ' | ' |
Stock Option Price For Options Granted Under Broad Based Stock Option Plan | $46.44 | ' | ' |
Term In Years Of Stock Options Granted Under Broad Based Stock Option Plan | '10 years | ' | ' |
Total compensation amount charged against income for stock options, performance stock units (PSUs) and restricted stock units | $54,000,000 | $50,500,000 | $43,500,000 |
Total income tax benefit recognized in the Consolidated Statements of Income for share-based compensation | 18,500,000 | 17,500,000 | 15,100,000 |
Intrinsic value of options exercised (in millions of dollars) | 135,400,000 | 130,200,000 | 81,300,000 |
Aggregate intrinsic value of options outstanding | 352,700,000 | ' | ' |
Aggregate intrinsic value of options exercisable | ' | 213,400,000 | ' |
Unrecognized compensation cost | 20,500,000 | ' | ' |
Weighted Average Period In Years That Total Unrecognized Compensation Cost Is Expected To Be Recognized | '2 years 5 months | ' | ' |
Stock Compensation Costs: | ' | ' | ' |
Stock or Unit Option Plan Expense | 21,400,000 | 19,300,000 | 22,500,000 |
Status Of Stock Options: | ' | ' | ' |
Outstanding shares at beginning of year | 10,553,914 | 14,540,442 | 17,997,082 |
Shares Granted | 1,779,109 | 2,110,945 | 2,191,627 |
Shares Exercised | -3,315,990 | -5,870,607 | -4,875,122 |
Shares Forfeited | -356,697 | -226,866 | -773,145 |
Outstanding shares at end of year | 8,660,336 | 10,553,914 | 14,540,442 |
Options exercisable as of end of period | 4,290,416 | 5,320,775 | 8,453,362 |
Weighted-average fair value of options granted (per share) | $14.51 | $10.60 | $9.97 |
Options outstanding at beginning of year weighted average exercise price | $48.08 | $44.86 | $42.21 |
Share-based Compensation Arrangements by Share-based Payment Award, Options, Grants in Period, Weighted Average Exercise Price | $81.95 | $60.89 | $51.62 |
Share-based Compensation Arrangements by Share-based Payment Award, Options, Exercises in Period, Weighted Average Exercise Price | $45.25 | $44.55 | $38.30 |
Options forfeited weighted average exercise price | $64.38 | $52.02 | $43.90 |
Options outstanding at end of year weighted average exercise price | $55.47 | $48.08 | $44.86 |
Options exercisable as of end of period weighted average exercise price | $46.45 | $45.74 | $46.95 |
Fair Value Of Stock Option Grant: | ' | ' | ' |
Dividend yields | 2.20% | 2.40% | 2.70% |
Expected volatility | 22.20% | 22.40% | 22.50% |
Risk-free interest rates | 1.40% | 1.50% | 2.80% |
Expected lives in years | '6 years 7 months | '6 years 7 months | '6 years 6 months |
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | ' | ' | ' |
Number of Outstanding Options | 8,660,336 | ' | ' |
Weighted Average Remaining Contractual Life in Years | '6 years 3 months | ' | ' |
Weighted Average Exercise Price | $55.47 | ' | ' |
Number of Exercisable Options | 4,290,416 | ' | ' |
Weighted Average Exercise Price | $46.45 | ' | ' |
Performance Stock Units and Restricted Stock Units | ' | ' | ' |
Performance stock units for which measurement date has not yet occurred for accounting purposes | 29,596 | 40,812 | ' |
Employee Service Share Based Compensation Unrecognized Compensation Costs On Nonvested Stock Units And Restricted Stock Units | 39,100,000 | ' | ' |
Weighted-average period (in years) that total unrecognized compensation cost related to non-vested stock units and restricted stock units is expected to be recognized | '2 years 1 month | ' | ' |
Intrinsic value of share-based liabilities paid, combined with the fair value of shares vested (in millions of dollars) | 62,600,000 | 37,300,000 | 36,600,000 |
Deferred performance stock units, deferred restricted stock units, and directors' fees and accumulated dividend amounts representing deferred stock units outstanding | 608,457 | ' | ' |
PSU Fair Value Monte Carlo Simulation Estimated Value | 55.49 | 35.62 | 37.79 |
PSU Fair Value Monte Carlo Simulation Dividend Yields | 2.00% | 2.50% | 2.70% |
PSU Fair Value Monte Carlo Simulation Expected Volatility | 17.10% | 20.00% | 28.80% |
Compensation amounts charged against income for Performance and Restricted Stock units [Abstract] | ' | ' | ' |
Share Based Compensation Arrangement By Share Based Payment Award For Performance And Restricted Stock Units Compensation Cost | $32,600,000 | $31,200,000 | $21,000,000 |
Status of Performance Stock units and Restricted Stock Units: | ' | ' | ' |
Stock performance units and restricted stock units outstanding as of beginning of period | 1,720,577 | ' | ' |
Performance stock units and Restricted stock units, Granted | 395,862 | 503,761 | 543,596 |
Performance stock units and Restricted stock units Performance assumption change | 176,534 | ' | ' |
Performance stock units and Restricted stock units, Vested | -754,991 | ' | ' |
Performance stock units and Restricted stock units, Forfeited | -126,583 | ' | ' |
Stock performance units and restricted stock units outstanding as of end of period | 1,411,399 | 1,720,577 | ' |
Weighted-average grant date fair value for equity awards or market value for liability awards: | ' | ' | ' |
Outstanding at beginning of year | $56.71 | ' | ' |
Granted | $88.49 | $64.99 | $58.28 |
Performance assumption change | $84.27 | ' | ' |
Vested | $50.33 | ' | ' |
Forfeited | $71.80 | ' | ' |
Outstanding at end of year | $72.43 | $56.71 | ' |
Price Range $39.57 - $60.10 [Member] | ' | ' | ' |
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | ' | ' | ' |
Number of Outstanding Options | 2,503,703 | ' | ' |
Weighted Average Remaining Contractual Life in Years | '5 years 1 month | ' | ' |
Weighted Average Exercise Price | $51.94 | ' | ' |
Number of Exercisable Options | 1,595,372 | ' | ' |
Weighted Average Exercise Price | $52.14 | ' | ' |
Price Range $33.40 - $39.26 [Member] | ' | ' | ' |
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | ' | ' | ' |
Number of Outstanding Options | 2,514,127 | ' | ' |
Weighted Average Remaining Contractual Life in Years | '5 years | ' | ' |
Weighted Average Exercise Price | $37.19 | ' | ' |
Number of Exercisable Options | 2,000,140 | ' | ' |
Weighted Average Exercise Price | $36.66 | ' | ' |
Price Range $60.68 - $91.65 [Member] | ' | ' | ' |
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | ' | ' | ' |
Number of Outstanding Options | 3,642,506 | ' | ' |
Weighted Average Remaining Contractual Life in Years | '7 years 9 months 45 days | ' | ' |
Weighted Average Exercise Price | $70.51 | ' | ' |
Number of Exercisable Options | 694,904 | ' | ' |
Weighted Average Exercise Price | $61.58 | ' | ' |
SUPPLEMENTAL_BALANCE_SHEET_INF2
SUPPLEMENTAL BALANCE SHEET INFORMATION (Details) (USD $) | 12 Months Ended | ||
Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | |
Accounts Receivable Additional Disclosures [Abstract] | ' | ' | ' |
Percentage Of Total Accounts Receivable Accounted For By Wal-Mart | 14.50% | ' | ' |
Accounts Receivable Percentage Greater Than Other Individual Customer Accounts | 17.30% | ' | ' |
Allowance for Doubtful Accounts Receivable, Current | $14,300,000 | $15,200,000 | ' |
Accrued Liabilities, Current [Abstract] | ' | ' | ' |
Payroll, compensation and benefits | 245,641,000 | 236,598,000 | ' |
Advertising and Promotion | 348,966,000 | 289,221,000 | ' |
Other | 105,115,000 | 125,087,000 | ' |
Total accrued liabilities | 699,722,000 | 650,906,000 | ' |
Finite-Lived Intangible Assets, Net, Amortization Expense, Fiscal Year Maturity [Abstract] | ' | ' | ' |
Estimated Amortization Expense - 2014 | 10,452,000 | ' | ' |
Estimated Amortization Expense - 2015 | 9,916,000 | ' | ' |
Estimated Amortization Expense - 2016 | 9,913,000 | ' | ' |
Estimated Amortization Expense - 2017 | 9,245,000 | ' | ' |
Estimated Amortization Expense - 2018 | 8,151,000 | ' | ' |
Finite-Lived Intangible Assets [Line Items] | ' | ' | ' |
Trademarks | 64,436,000 | 68,490,000 | ' |
Customer-related | 72,094,000 | 74,790,000 | ' |
Intangible asset associated with cooperative agreement with Bauducco | 13,683,000 | 13,683,000 | ' |
Patents | 19,278,000 | 20,018,000 | ' |
Finite-Lived Intangible Assets, Translation Adjustments | -9,256,000 | -6,470,000 | ' |
Total other intangible assets, Gross | 241,700,000 | 251,976,000 | ' |
Finite-Lived Intangible Assets, Accumulated Amortization | -46,456,000 | -37,263,000 | ' |
Translation Adjustment, Amortization Expense | 2,703,000 | 1,682,000 | ' |
Other intangibles | 195,244,000 | 214,713,000 | ' |
Amortization of Intangible Assets | 10,800,000 | 10,600,000 | 4,600,000 |
Goodwill [Roll Forward] | ' | ' | ' |
Goodwill balance at beginning of year | 588,003,000 | 516,745,000 | ' |
Goodwill, Translation Adjustments | -11,442,000 | 3,284,000 | ' |
Goodwill, Acquired During Period | 0 | 67,974,000 | ' |
Goodwill balance at end of year | 576,561,000 | 588,003,000 | 516,745,000 |
Goodwill, Impaired, Accumulated Impairment Loss | 70,100,000 | ' | ' |
Indefinite-Lived Intangible Assets (Excluding Goodwill) [Abstract] | ' | ' | ' |
Indefinite-Lived Trademarks | 81,465,000 | 81,465,000 | ' |
Indefinite Lived Intangible Assets Accumulated Impairment Loss | 46,700,000 | ' | ' |
Inventory, Net [Abstract] | ' | ' | ' |
Raw Materials | 226,978,000 | 256,969,000 | ' |
Goods in Process | 79,861,000 | 78,292,000 | ' |
Finished Goods | 517,968,000 | 496,981,000 | ' |
Inventories at FIFO | 824,807,000 | 832,242,000 | ' |
Adjustments to LIFO | -165,266,000 | -198,980,000 | ' |
Total Inventories | 659,541,000 | 633,262,000 | ' |
LIFO Inventory Amount | 314,900,000 | 331,700,000 | ' |
Other Liabilities, Noncurrent [Abstract] | ' | ' | ' |
Post-retirement Benefits Liabilities | 245,460,000 | 292,234,000 | ' |
Pension Benefits Liabilities | 50,842,000 | 240,215,000 | ' |
Other | 137,766,000 | 136,283,000 | ' |
Total Other Long-Term Liabilities | 434,068,000 | 668,732,000 | ' |
Property, Plant and Equipment [Abstract] | ' | ' | ' |
Land | 96,334,000 | 92,916,000 | ' |
Buildings and Improvements, Gross | 956,890,000 | 878,527,000 | ' |
Machinery and Equipment, Gross | 2,726,170,000 | 2,589,183,000 | ' |
Property, Plant and Equipment, Gross | 3,779,394,000 | 3,560,626,000 | ' |
Accumulated Depreciation, Depletion and Amortization, Property, Plant, and Equipment | -1,974,049,000 | -1,886,555,000 | ' |
Property, Plant and Equipment, Net | 1,805,345,000 | 1,674,071,000 | ' |
Construction in Progress, Gross | 273,100,000 | 217,500,000 | ' |
Payments for Construction in Process | ' | 41,100,000 | ' |
Accelerated Depreciation Of Property Plant And Equipment | ' | 15,300,000 | ' |
Trademarks [Member] | ' | ' | ' |
Finite-Lived Intangible Assets [Line Items] | ' | ' | ' |
Finite-Lived Intangible Assets, Accumulated Amortization | -5,190,000 | -2,250,000 | ' |
Finite-Lived Intangible Asset, Useful Life | '25 years | ' | ' |
Customer Relationships [Member] | ' | ' | ' |
Finite-Lived Intangible Assets [Line Items] | ' | ' | ' |
Finite-Lived Intangible Assets, Accumulated Amortization | -26,853,000 | -22,990,000 | ' |
Finite-Lived Intangible Asset, Useful Life | '15 years | ' | ' |
Cooperative Agreement with Bauducco. [Member] | ' | ' | ' |
Finite-Lived Intangible Assets [Line Items] | ' | ' | ' |
Finite-Lived Intangible Assets, Accumulated Amortization | -7,379,000 | -6,294,000 | ' |
Patents [Member] | ' | ' | ' |
Finite-Lived Intangible Assets [Line Items] | ' | ' | ' |
Finite-Lived Intangible Assets, Accumulated Amortization | ($9,737,000) | ($7,411,000) | ' |
Finite-Lived Intangible Asset, Useful Life | '5 years | ' | ' |
SEGMENT_INFORMATION_Details
SEGMENT INFORMATION (Details) (USD $) | 12 Months Ended | ||
In Billions, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
Segment Reporting [Abstract] | ' | ' | ' |
Number Of Brand Names Under Which Products Are Sold | '80 | ' | ' |
Approximate Number Of Countries In Which Confectionary Products Are Marketed | '70 | ' | ' |
Percentage of Sales to Foreign Countries | 16.60% | 16.20% | 15.70% |
Percentage of Assets Outside the United States | 19.40% | 20.50% | ' |
Percentage of Total Sales to McLane, Inc. | 'exceeded 10% | ' | ' |
Total Net Sales to McLane, Inc. | $1.80 | $1.50 | $1.40 |
QUARTERLY_DATA_Details
QUARTERLY DATA (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 |
QUATERLY FINANCIAL DATA [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Net Sales | $1,956,253 | $1,853,886 | $1,508,514 | $1,827,426 | $1,751,035 | $1,746,709 | $1,414,444 | $1,732,064 | $7,146,079 | $6,644,252 | $6,080,788 |
Gross Profit | 857,386 | 855,551 | 718,574 | 849,337 | 755,208 | 742,757 | 618,521 | 743,396 | ' | ' | ' |
Net Income | $186,075 | $232,985 | $159,504 | $241,906 | $149,879 | $176,716 | $135,685 | $198,651 | $820,470 | $660,931 | $628,962 |
Market Price of Common Stock High | $100.90 | $97.69 | $91.25 | $87.53 | $74.64 | $73.16 | $72.03 | $61.94 | ' | ' | ' |
Market Price of Common Stock Low | $91.04 | $89.17 | $85.25 | $73.51 | $68.85 | $70.09 | $59.81 | $59.49 | ' | ' | ' |
Common Stock | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
QUATERLY FINANCIAL DATA [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Earnings Per Share - Basic | $0.85 | $1.07 | $0.73 | $1.11 | $0.69 | $0.80 | $0.62 | $0.91 | $3.76 | $3.01 | $2.85 |
Earnings Per Share - Diluted | $0.82 | $1.03 | $0.70 | $1.06 | $0.66 | $0.77 | $0.59 | $0.87 | $3.61 | $2.89 | $2.74 |
Common Stock | $0.49 | $0.49 | $0.42 | $0.42 | $0.42 | $0.38 | $0.38 | $0.38 | $1.81 | $1.56 | $1.38 |
Common Class B | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
QUATERLY FINANCIAL DATA [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Earnings Per Share - Basic | $0.77 | $0.96 | $0.66 | $1 | $0.62 | $0.73 | $0.56 | $0.82 | $3.39 | $2.73 | $2.58 |
Earnings Per Share - Diluted | $0.76 | $0.95 | $0.66 | $0.99 | $0.62 | $0.73 | $0.55 | $0.81 | $3.37 | $2.71 | $2.56 |
Common Stock | $0.44 | $0.44 | $0.38 | $0.38 | $0.38 | $0.34 | $0.34 | $0.34 | $1.63 | $1.41 | $1.25 |
SCHEDULE_II_VALUATION_AND_QUAL1
SCHEDULE II - VALUATION AND QUALIFYING ACCOUNTS (Details) (Allowance for Doubtful Accounts [Member], USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
Allowance for Doubtful Accounts [Member] | ' | ' | ' |
Valuation and Qualifying Accounts Disclosure [Line Items] | ' | ' | ' |
Balance at Beginning of Period | $10,435 | $14,977 | $15,190 |
Charged to Cost and Expense | 154,092 | 134,972 | 135,147 |
Charged to Other Accounts | 0 | 0 | 0 |
Deductions from Reserves | -154,283 | -139,514 | -135,360 |
Balance at End of Period | $10,244 | $10,435 | $14,977 |