DOCUMENT AND ENTITY INFORMATION
DOCUMENT AND ENTITY INFORMATION - shares | 9 Months Ended | |
Oct. 03, 2021 | Oct. 22, 2021 | |
Entity Information [Line Items] | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Period End Date | Oct. 3, 2021 | |
Document Transition Report | false | |
Entity File Number | 1-183 | |
Entity Registrant Name | HERSHEY CO | |
Entity Incorporation, State or Country Code | DE | |
Entity Tax Identification Number | 23-0691590 | |
Entity Address, Address Line One | 19 East Chocolate Avenue | |
Entity Address, City or Town | Hershey | |
Entity Address, State or Province | PA | |
Entity Address, Postal Zip Code | 17033 | |
City Area Code | 717 | |
Local Phone Number | 534-4200 | |
Title of 12(b) Security | Common Stock, one dollar par value | |
Trading Symbol | HSY | |
Security Exchange Name | NYSE | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Large Accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Central Index Key | 0000047111 | |
Document Fiscal Year Focus | 2021 | |
Current Fiscal Year End Date | --12-31 | |
Document Fiscal Period Focus | Q3 | |
Amendment Flag | false | |
Common stock | ||
Entity Information [Line Items] | ||
Entity Common Stock, Shares Outstanding | 145,389,951 | |
Class B common stock | ||
Entity Information [Line Items] | ||
Entity Common Stock, Shares Outstanding | 60,613,777 |
CONSOLIDATED STATEMENTS OF INCO
CONSOLIDATED STATEMENTS OF INCOME - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Oct. 03, 2021 | Sep. 27, 2020 | Oct. 03, 2021 | Sep. 27, 2020 | |
Net sales | $ 2,359,839 | $ 2,219,829 | $ 6,645,209 | $ 5,964,475 |
Cost of sales | 1,298,504 | 1,139,805 | 3,609,478 | 3,225,277 |
Gross profit | 1,061,335 | 1,080,024 | 3,035,731 | 2,739,198 |
Selling, marketing and administrative expense | 486,139 | 468,614 | 1,448,433 | 1,352,947 |
Long-lived asset impairment charges | 0 | 0 | 0 | 9,143 |
Business realignment costs (benefits) | 365 | 0 | 2,748 | (475) |
Operating profit | 574,831 | 611,410 | 1,584,550 | 1,377,583 |
Interest expense, net | 30,154 | 37,258 | 97,655 | 111,592 |
Other (income) expense, net | 23,004 | 11,644 | 32,612 | 34,394 |
Income before income taxes | 521,673 | 562,508 | 1,454,283 | 1,231,597 |
Provision for income taxes | 76,746 | 115,250 | 311,255 | 247,514 |
Net income including noncontrolling interest | 444,927 | 447,258 | 1,143,028 | 984,083 |
Less: Net (loss) gain attributable to noncontrolling interest | 0 | (25) | 1,072 | (3,238) |
Net income attributable to The Hershey Company | $ 444,927 | $ 447,283 | $ 1,141,956 | $ 987,321 |
Common stock | ||||
Net income per share—basic: | ||||
Net income per share - basic (USD per share) | $ 2.22 | $ 2.21 | $ 5.67 | $ 4.87 |
Net income per share—diluted: | ||||
Net income per share - diluted (USD per share) | 2.14 | 2.14 | 5.49 | 4.71 |
Dividends paid per share: | ||||
Dividends paid per share (USD per share) | 0.901 | 0.804 | 2.509 | 2.350 |
Class B common stock | ||||
Net income per share—basic: | ||||
Net income per share - basic (USD per share) | 2.01 | 2 | 5.16 | 4.42 |
Net income per share—diluted: | ||||
Net income per share - diluted (USD per share) | 2.01 | 2 | 5.14 | 4.40 |
Dividends paid per share: | ||||
Dividends paid per share (USD per share) | $ 0.819 | $ 0.731 | $ 2.281 | $ 2.135 |
CONSOLIDATED STATEMENTS OF COMP
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Oct. 03, 2021 | Sep. 27, 2020 | Oct. 03, 2021 | Sep. 27, 2020 | |
Statement of Comprehensive Income [Abstract] | ||||
Net income including noncontrolling interest | $ 444,927 | $ 447,258 | $ 1,143,028 | $ 984,083 |
Other comprehensive (loss) income, net of tax: | ||||
Foreign currency translation gains (losses) during period, pre-tax amount | (11,571) | 7,050 | 2,623 | (41,242) |
Foreign currency translation gains (losses) during period, tax (expense) benefit | 0 | 0 | 0 | 0 |
Foreign currency translation gains (losses) during period, after-tax amount | (11,571) | 7,050 | 2,623 | (41,242) |
Reclassification to earnings due to the sale of businesses, pre-tax amount | 0 | 0 | 5,210 | 0 |
Reclassification to earnings due to the sale of businesses, tax (expense) benefit | 0 | 0 | 0 | 0 |
Reclassification to earnings due to the sale of businesses, after tax | 0 | 0 | 5,210 | 0 |
Pension and post-retirement benefit plans: | ||||
Net actuarial (loss) gain and service cost, pre-tax amount | (8,793) | 3,204 | 11,912 | (13,481) |
Net actuarial (loss) gain and service cost, tax (expense) benefit | 2,093 | (758) | (2,835) | 3,195 |
Net actuarial (loss) gain and service cost, after tax | (6,700) | 2,446 | 9,077 | (10,286) |
Reclassification to earnings, pre-tax amount | 8,457 | 4,945 | 24,246 | 18,242 |
Reclassification to earnings, tax (expense) benefit | (671) | (452) | (4,739) | (3,183) |
Reclassification to earnings, after-tax amount | 7,786 | 4,493 | 19,507 | 15,059 |
Cash flow hedges: | ||||
Gains (losses) on cash flow hedging derivatives, pre-tax amount | 5,779 | (807) | (2,200) | 5,249 |
Gains (losses) on cash flow hedging derivatives, tax (expense) benefit | (2,153) | 441 | (2,312) | 174 |
Gains (losses) on cash flow hedging derivatives, after-tax amount | 3,626 | (366) | (4,512) | 5,423 |
Reclassification to earnings, pre-tax amount | 4,709 | 2,341 | 13,527 | 5,638 |
Reclassification to earnings, tax (expense) benefit | (119) | (578) | (501) | (2,508) |
Reclassification to earnings, after-tax amount | 4,590 | 1,763 | 13,026 | 3,130 |
Total other comprehensive (loss) income, pre-tax amount | (1,419) | 16,733 | 55,318 | (25,594) |
Total other comprehensive (loss) income, tax (expense) benefit | (850) | (1,347) | (10,387) | (2,322) |
Total other comprehensive (loss) income, after-tax amount | (2,269) | 15,386 | 44,931 | (27,916) |
Total comprehensive income including noncontrolling interest | 442,658 | 462,644 | 1,187,959 | 956,167 |
Comprehensive (loss) income attributable to noncontrolling interest | (5) | 475 | 6,321 | (2,813) |
Comprehensive income attributable to The Hershey Company | $ 442,663 | $ 462,169 | $ 1,181,638 | $ 958,980 |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Oct. 03, 2021 | Dec. 31, 2020 |
Current assets: | ||
Cash and cash equivalents | $ 675,516 | $ 1,143,987 |
Accounts receivable—trade, net | 841,227 | 615,233 |
Inventories | 1,026,541 | 964,207 |
Prepaid expenses and other | 198,660 | 254,478 |
Total current assets | 2,741,944 | 2,977,905 |
Property, plant and equipment, net | 2,370,193 | 2,285,255 |
Goodwill | 2,164,580 | 1,988,215 |
Other intangibles | 1,494,106 | 1,295,214 |
Other non-current assets | 628,686 | 555,887 |
Deferred income taxes | 39,674 | 29,369 |
Total assets | 9,439,183 | 9,131,845 |
Current liabilities: | ||
Accounts payable | 671,855 | 580,058 |
Accrued liabilities | 751,972 | 781,766 |
Accrued income taxes | 69,482 | 17,051 |
Short-term debt | 410,374 | 74,041 |
Current portion of long-term debt | 2,812 | 438,829 |
Total current liabilities | 1,906,495 | 1,891,745 |
Long-term debt | 4,095,159 | 4,089,755 |
Other long-term liabilities | 639,896 | 683,434 |
Deferred income taxes | 260,500 | 229,028 |
Total liabilities | 6,902,050 | 6,893,962 |
Stockholders’ equity: | ||
Preferred stock, shares issued: none in 2021 and 2020 | 0 | 0 |
Additional paid-in capital | 1,240,012 | 1,191,200 |
Retained earnings | 2,565,538 | 1,928,673 |
Treasury—common stock shares, at cost: 15,564,962 at October 3, 2021 and 13,325,898 at December 31, 2020 | (1,200,409) | (768,992) |
Accumulated other comprehensive loss | (298,400) | (338,082) |
Total—The Hershey Company stockholders’ equity | 2,528,294 | 2,234,352 |
Noncontrolling interest in subsidiary | 8,839 | 3,531 |
Total stockholders’ equity | 2,537,133 | 2,237,883 |
Total liabilities and stockholders’ equity | 9,439,183 | 9,131,845 |
Common stock | ||
Stockholders’ equity: | ||
Common stock | 160,939 | 160,939 |
Class B common stock | ||
Stockholders’ equity: | ||
Common stock | $ 60,614 | $ 60,614 |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) - shares | Oct. 03, 2021 | Dec. 31, 2020 |
Preferred stock, shares issued (shares) | 0 | 0 |
Treasury stock, shares (shares) | 15,564,962 | 13,325,898 |
Common stock | ||
Common stock, shares issued (shares) | 160,939,248 | 160,939,248 |
Class B common stock | ||
Common stock, shares issued (shares) | 60,613,777 | 60,613,777 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 9 Months Ended | |
Oct. 03, 2021 | Sep. 27, 2020 | |
Operating Activities | ||
Net income including noncontrolling interest | $ 1,143,028 | $ 984,083 |
Adjustments to reconcile net income to net cash provided by operating activities: | ||
Depreciation and amortization | 231,953 | 217,689 |
Stock-based compensation expense | 51,009 | 37,897 |
Deferred income taxes | 762 | 7,237 |
Impairment of long-lived assets | 0 | 9,143 |
Write-down of equity investments | 28,734 | 29,257 |
Other | 77,548 | 42,623 |
Changes in assets and liabilities, net of business acquisitions and divestitures: | ||
Accounts receivable—trade, net | (222,864) | (275,649) |
Inventories | (38,864) | (151,919) |
Prepaid expenses and other current assets | 11,908 | 7,629 |
Accounts payable and accrued liabilities | 76,446 | 132,265 |
Accrued income taxes | 92,236 | 77,970 |
Contributions to pension and other benefit plans | (38,576) | (12,238) |
Other assets and liabilities | (9,603) | (10,721) |
Net cash provided by operating activities | 1,403,717 | 1,095,266 |
Investing Activities | ||
Capital additions (including software) | (347,450) | (292,051) |
Equity investments in tax credit qualifying partnerships | (75,917) | (46,438) |
Business acquisitions, net of cash and cash equivalents acquired | (419,501) | 0 |
Other investing activities | 3,129 | (2,765) |
Net cash used in investing activities | (839,739) | (341,254) |
Financing Activities | ||
Net increase in short-term debt | 339,981 | 13,398 |
Long-term borrowings, net of debt issuance costs | 0 | 989,876 |
Repayment of long-term debt and finance leases | (438,029) | (353,136) |
Cash dividends paid | (505,194) | (478,018) |
Repurchase of common stock | (457,946) | (211,196) |
Exercise of stock options | 23,362 | 19,111 |
Net cash used in financing activities | (1,037,826) | (19,965) |
Effect of exchange rate changes on cash and cash equivalents | (6,057) | (10,737) |
(Decrease) increase in cash and cash equivalents, including cash classified as held for sale | (479,905) | 723,310 |
Less: Decrease (increase) in cash and cash equivalents classified as held for sale | 11,434 | (10,683) |
Net (decrease) increase in cash and cash equivalents | (468,471) | 712,627 |
Cash and cash equivalents, beginning of period | 1,143,987 | 493,262 |
Cash and cash equivalents, end of period | 675,516 | 1,205,889 |
Interest Paid, Excluding Capitalized Interest, Operating Activities | 92,397 | 103,009 |
Supplemental Disclosure | ||
Income taxes paid | $ 199,735 | $ 165,214 |
CONSOLIDATED STATEMENTS OF STOC
CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY - USD ($) $ in Thousands | Total | Common stock | Class B common stock | Preferred Stock | Common stockCommon stock | Common stockClass B common stock | Additional Paid-in Capital | Retained Earnings | Retained EarningsCommon stock | Retained EarningsClass B common stock | Treasury Common Stock | Accumulated Other Comprehensive (Loss) Income | Noncontrolling Interests in Subsidiaries |
Beginning balance, stockholders' equity at Dec. 31, 2019 | $ 1,744,994 | $ 0 | $ 160,939 | $ 60,614 | $ 1,142,210 | $ 1,290,461 | $ (591,036) | $ (323,966) | $ 5,772 | ||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||||||||
Net income (loss) | 984,083 | 987,321 | (3,238) | ||||||||||
Other comprehensive (loss) income | (27,916) | (28,341) | 425 | ||||||||||
Dividends (including dividend equivalents): | |||||||||||||
Common Stock | $ (348,186) | $ (129,410) | $ (348,186) | $ (129,410) | |||||||||
Stock-based compensation | 37,333 | 37,333 | |||||||||||
Exercise of stock options and incentive-based transactions | 19,111 | (9,960) | 29,071 | ||||||||||
Repurchase of common stock | (211,196) | (211,196) | |||||||||||
Ending balance, stockholders' equity at Sep. 27, 2020 | 2,068,813 | 0 | 160,939 | 60,614 | 1,169,583 | 1,800,186 | (773,161) | (352,307) | 2,959 | ||||
Dividends (including dividend equivalents): | |||||||||||||
Dividends paid per share (USD per share) | $ 2.350 | $ 2.135 | |||||||||||
Beginning balance, stockholders' equity at Jun. 28, 2020 | 1,756,089 | 0 | 160,939 | 60,614 | 1,161,878 | 1,516,543 | (779,176) | (367,193) | 2,484 | ||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||||||||
Net income (loss) | 447,258 | 447,283 | (25) | ||||||||||
Other comprehensive (loss) income | 15,386 | 14,886 | 500 | ||||||||||
Dividends (including dividend equivalents): | |||||||||||||
Common Stock | $ (119,332) | $ (44,308) | (119,332) | (44,308) | |||||||||
Stock-based compensation | 12,153 | 12,153 | |||||||||||
Exercise of stock options and incentive-based transactions | 1,567 | (4,448) | 6,015 | ||||||||||
Ending balance, stockholders' equity at Sep. 27, 2020 | 2,068,813 | 0 | 160,939 | 60,614 | 1,169,583 | 1,800,186 | (773,161) | (352,307) | 2,959 | ||||
Dividends (including dividend equivalents): | |||||||||||||
Dividends paid per share (USD per share) | $ 0.804 | $ 0.731 | |||||||||||
Beginning balance, stockholders' equity at Dec. 31, 2020 | 2,237,883 | 0 | 160,939 | 60,614 | 1,191,200 | 1,928,673 | (768,992) | (338,082) | 3,531 | ||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||||||||
Net income (loss) | 1,143,028 | 1,141,956 | 1,072 | ||||||||||
Other comprehensive (loss) income | 44,931 | 39,682 | 5,249 | ||||||||||
Dividends (including dividend equivalents): | |||||||||||||
Common Stock | $ (366,831) | $ (138,260) | (366,831) | (138,260) | |||||||||
Stock-based compensation | 51,979 | 51,979 | |||||||||||
Exercise of stock options and incentive-based transactions | 23,362 | (3,167) | 26,529 | ||||||||||
Repurchase of common stock | (457,946) | (457,946) | |||||||||||
Divestiture of noncontrolling interest | (1,013) | (1,013) | |||||||||||
Ending balance, stockholders' equity at Oct. 03, 2021 | 2,537,133 | 0 | 160,939 | 60,614 | 1,240,012 | 2,565,538 | (1,200,409) | (298,400) | 8,839 | ||||
Dividends (including dividend equivalents): | |||||||||||||
Dividends paid per share (USD per share) | $ 2.509 | $ 2.281 | |||||||||||
Beginning balance, stockholders' equity at Jul. 04, 2021 | 2,273,893 | 0 | 160,939 | 60,614 | 1,218,708 | 2,301,805 | (1,180,881) | (296,136) | 8,844 | ||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||||||||
Net income (loss) | 444,927 | 444,927 | 0 | ||||||||||
Other comprehensive (loss) income | (2,269) | (2,264) | (5) | ||||||||||
Dividends (including dividend equivalents): | |||||||||||||
Common Stock | $ (131,551) | $ (49,643) | $ (131,551) | $ (49,643) | |||||||||
Stock-based compensation | 18,903 | 18,903 | |||||||||||
Exercise of stock options and incentive-based transactions | 6,473 | 2,401 | 4,072 | ||||||||||
Repurchase of common stock | (23,600) | (23,600) | |||||||||||
Ending balance, stockholders' equity at Oct. 03, 2021 | $ 2,537,133 | $ 0 | $ 160,939 | $ 60,614 | $ 1,240,012 | $ 2,565,538 | $ (1,200,409) | $ (298,400) | $ 8,839 | ||||
Dividends (including dividend equivalents): | |||||||||||||
Dividends paid per share (USD per share) | $ 0.901 | $ 0.819 |
CONSOLIDATED STATEMENTS OF ST_2
CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY (Parenthetical) - $ / shares | 3 Months Ended | 9 Months Ended | ||
Oct. 03, 2021 | Sep. 27, 2020 | Oct. 03, 2021 | Sep. 27, 2020 | |
Common stock | ||||
Dividends paid per share (USD per share) | $ 0.901 | $ 0.804 | $ 2.509 | $ 2.350 |
Class B common stock | ||||
Dividends paid per share (USD per share) | $ 0.819 | $ 0.731 | $ 2.281 | $ 2.135 |
SUMMARY OF SIGNIFICANT ACCOUNTI
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 9 Months Ended |
Oct. 03, 2021 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Basis of Presentation The unaudited consolidated financial statements provided in this report include the accounts of The Hershey Company (the “Company,” “Hershey,” “we” or “us”) 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 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. We use the equity method of accounting when we have a 20% to 50% interest in other companies and exercise significant influence. Other investments that are not controlled, and over which we do not have the ability to exercise significant influence, are accounted for under the cost method. Both equity and cost method investments are included as Other non-current assets in the Consolidated Balance Sheets. The financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) for interim financial reporting and with the rules and regulations for reporting on Form 10-Q. Accordingly, they do not contain certain information and disclosures required by GAAP for comprehensive financial statements. The financial statements reflect all adjustments (consisting of normal recurring adjustments) which are, in our opinion, necessary for a fair presentation of the results of operations, financial position, and cash flows for the indicated periods. Operating results for the quarter ended October 3, 2021 may not be indicative of the results that may be expected for the year ending December 31, 2021 because of seasonal effects on our business. These financial statements should be read in conjunction with our Annual Report on Form 10-K for the year ended December 31, 2020 (our “2020 Annual Report on Form 10-K”), which provides a more complete understanding of our accounting policies, financial position, operating results and other matters. COVID-19 On March 11, 2020, the World Health Organization designated coronavirus disease 2019 (“COVID-19”) as a global pandemic. We continue to actively monitor COVID-19 and its potential impact on our operations and financial results. Employee health and safety remains our first priority while we continue our efforts to support community food supplies. Since the onset of COVID-19, there has been minimal disruption to our supply chain network, and all our manufacturing plants are currently open. However, during the third quarter of 2021, continued strong demand for consumer goods and the effects of COVID-19 mitigation strategies have led to broad-based supply chain disruptions across the United States, including inflation on many consumer products, labor shortages and demand outpacing supply. We are working closely with our business units, contract manufacturers, distributors, contractors and other external business partners to minimize the potential impact on our business. The ultimate impact that COVID-19 will have on our consolidated financial statements remains uncertain and ultimately will be dictated by the length and severity of the pandemic, including broad-based supply chain disruptions, COVID-19 variants or resurgences, as well as the economic recovery and actions taken in response by local, state and national governments around the world, including the distribution of vaccinations. We will continue to evaluate the nature and extent of these potential and evolving impacts to our business and consolidated financial statements. Recent Accounting Pronouncements Recently Adopted Accounting Pronouncements In December 2019, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2019-12, Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes . This ASU is intended to simplify various aspects related to accounting for income taxes by removing certain exceptions to the general principles in Topic 740 and clarifying certain aspects of the current guidance to promote consistency among reporting entities. ASU 2019-12 is effective for annual periods beginning after December 15, 2020 and interim periods within those annual periods, with early adoption permitted. An entity that elects early adoption must adopt all the amendments in the same period. Most amendments within this ASU are required to be applied on a prospective basis, while certain amendments must be applied on a retrospective or modified retrospective basis. We adopted the provisions of this ASU in the fourth quarter of 2020. Adoption of the new standard did not have a material impact on our consolidated financial statements. Recently Issued Accounting Pronouncements Not Yet Adopted In March 2020, the FASB issued ASU No. 2020-04, Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting . The ASU is intended to provide temporary optional expedients and exceptions to the GAAP guidance on contract modifications and hedge accounting to ease the financial reporting burdens related to the expected market transition from the London Interbank Offered Rate (LIBOR) and other interbank offered rates to alternative reference rates. Entities may apply this ASU upon issuance through December 31, 2022 on a prospective basis. We are currently evaluating the impact of the new standard on our consolidated financial statements and related disclosures. No other new accounting pronouncement issued or effective during the fiscal year had or is expected to have a material impact on our consolidated financial statements or disclosures. |
BUSINESS ACQUISITION AND DIVEST
BUSINESS ACQUISITION AND DIVESTITURES | 9 Months Ended |
Oct. 03, 2021 | |
Business Combinations [Abstract] | |
Business Acquisition and Divestitures | BUSINESS ACQUISITION AND DIVESTITURES 2021 Activity Lily's Sweets, LLC On June 25, 2021, we completed the acquisition of Lily’s Sweets, LLC (“Lily’s”), previously a privately held company that sells a line of sugar-free and low-sugar confectionery foods to retailers and distributors in the United States and Canada. Lily’s products include dark and milk chocolate style bars, baking chips, peanut butter cups and other confection products that complement Hershey’s confectionery and confectionery-based portfolio. The initial cash consideration paid for Lily’s totaled $422,210 and the Company may be required to pay additional cash consideration if certain defined targets related to net sales and gross margin are exceeded during the period from the closing date through December 31, 2021. As of the acquisition date, the estimated fair value of the contingent consideration obligation was classified as a liability of $5,000 and was determined using a scenario-based analysis on forecasted future results. Acquisition-related costs for the Lily’s acquisition were immaterial. The acquisition has been accounted for as a business combination and, accordingly, Lily’s has been included within the North America segment from the date of acquisition. The purchase consideration, inclusive of the acquisition date fair value of the contingent consideration, was allocated to assets acquired and liabilities assumed based on their respective fair values as follows: Initial Allocation (1) Adjustments Updated Allocation Goodwill $ 174,516 $ 1,310 $ 175,826 Other intangible assets 235,800 — 235,800 Other assets acquired, primarily current assets 30,383 2,709 33,092 Other liabilities assumed, primarily current liabilities (9,620) — (9,620) Deferred income taxes (7,888) — (7,888) Net assets acquired $ 423,191 $ 4,019 $ 427,210 (1) As reported in the Company’s Quarterly Report on Form 10-Q for the quarterly period ended July 4, 2021. The purchase price allocation presented above is preliminary. The measurement period adjustments to the initial allocation are based on more detailed information obtained about the specific assets acquired. We continue to refine our purchase price allocation, including goodwill, and expect to finalize by the end of 2021. Goodwill was determined as the excess of the purchase price over the fair value of the net assets acquired (including the identifiable intangible assets). The majority of goodwill derived from this acquisition is expected to be deductible for tax purposes and reflects the value of leveraging our brand building expertise, supply chain capabilities and retail relationships to accelerate growth and access to the portfolio of Lily’s products. Other intangible assets include trademarks valued at $151,600 and customer relationships valued at $84,200. Trademarks were assigned an estimated useful life of 33 years and customer relationships were assigned estimated useful lives ranging from 17 to 18 years. Lotte Shanghai Foods Co., Ltd. In January 2021, we completed the divestiture of Lotte Shanghai Foods Co., Ltd. (“LSFC”), which was previously included within the International and Other segment results in our consolidated financial statements. Total proceeds from the divestiture and the impact on our consolidated financial statements were immaterial and were recorded in the selling, marketing and administrative (“SM&A”) expense caption within the Consolidated Statements of Income. 2020 Activity During the second quarter of 2020, we completed the divestitures of KRAVE Pure Foods, Inc. and the Scharffen Berger and Dagoba brands, all of which were previously included within the North America segment results in our consolidated financial statements. Total proceeds from the divestitures and the impact on our Consolidated Statements of Income, both individually and on an aggregate basis, were immaterial. |
GOODWILL AND INTANGIBLE ASSETS
GOODWILL AND INTANGIBLE ASSETS | 9 Months Ended |
Oct. 03, 2021 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill and Intangible Assets | GOODWILL AND INTANGIBLE ASSETS The changes in the carrying value of goodwill by reportable segment for the nine months ended October 3, 2021 are as follows: North America International Total Balance at December 31, 2020 $ 1,970,445 $ 17,770 $ 1,988,215 Acquired during the period (see Note 2 ) 174,516 — 174,516 Measurement period adjustments (see Note 2 ) 1,310 — 1,310 Foreign currency translation 937 (398) 539 Balance at October 3, 2021 $ 2,147,208 $ 17,372 $ 2,164,580 The following table provides the gross carrying amount and accumulated amortization for each major class of intangible asset: October 3, 2021 December 31, 2020 Gross Carrying Amount Accumulated Amortization Gross Carrying Amount Accumulated Amortization Intangible assets subject to amortization: Trademarks $ 1,363,112 $ (131,674) $ 1,211,086 $ (104,939) Customer-related 288,582 (60,325) 204,101 (49,616) Patents 8,626 (8,626) 8,556 (8,542) Total 1,660,320 (200,625) 1,423,743 (163,097) Intangible assets not subject to amortization: Trademarks 34,411 34,568 Total other intangible assets $ 1,494,106 $ 1,295,214 Total amortization expense for the three months ended October 3, 2021 and September 27, 2020 was $13,936 and $11,618, respectively. Total amortization expense for the nine months ended October 3, 2021 and September 27, 2020 was $37,192 and $34,838, respectively. |
SHORT AND LONG-TERM DEBT
SHORT AND LONG-TERM DEBT | 9 Months Ended |
Oct. 03, 2021 | |
Debt Disclosure [Abstract] | |
Short and Long-Term Debt | SHORT AND LONG-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 three months or less. We maintain a $1.5 billion unsecured revolving credit facility with the option to increase borrowings by an additional $500 million with the consent of the lenders. This facility is scheduled to expire on July 2, 2024; however, we may extend the termination date for up to two additional one-year periods upon notice to the administrative agent under the facility. The credit agreement contains certain financial and other covenants, customary representations, warranties and events of default. As of October 3, 2021, we were in compliance with all covenants pertaining to the credit agreement, and we had no significant compensating balance agreements that legally restricted these funds. For more information, refer to the Consolidated Financial Statements included in our 2020 Annual Report on Form 10-K. In addition to the revolving credit facility, we maintain lines of credit with domestic and international commercial banks. Commitment fees relating to our revolving credit facility and lines of credit are not material. Short-term debt consisted of the following: October 3, 2021 December 31, 2020 Short-term foreign bank borrowings against lines of credit $ 65,398 $ 74,041 U.S. commercial paper 344,976 — Total short-term debt $ 410,374 $ 74,041 Weighted average interest rate on outstanding commercial paper 0.1 % N/A Long-term Debt Long-term debt consisted of the following: Debt Type and Rate Maturity Date October 3, 2021 December 31, 2020 8.800% Debentures (1) February 15, 2021 $ — $ 84,715 3.100% Notes (2) May 15, 2021 — 350,000 2.625% Notes May 1, 2023 250,000 250,000 3.375% Notes May 15, 2023 500,000 500,000 2.050% Notes November 15, 2024 300,000 300,000 0.900% Notes June 1, 2025 300,000 300,000 3.200% Notes August 21, 2025 300,000 300,000 2.300% Notes August 15, 2026 500,000 500,000 7.200% Debentures August 15, 2027 193,639 193,639 2.450% Notes November 15, 2029 300,000 300,000 1.700% Notes June 1, 2030 350,000 350,000 3.375% Notes August 15, 2046 300,000 300,000 3.125% Notes November 15, 2049 400,000 400,000 2.650% Notes June 1, 2050 350,000 350,000 Finance lease obligations (see Note 7 ) 78,246 80,755 Net impact of interest rate swaps, debt issuance costs and unamortized debt discounts (23,914) (30,525) Total long-term debt 4,097,971 4,528,584 Less—current portion 2,812 438,829 Long-term portion $ 4,095,159 $ 4,089,755 (1) In February 2021, we repaid $84,715 of 8.800% Debentures due upon their maturity. (2) In May 2021, we repaid $350,000 of 3.100% Notes due upon their maturity. Interest Expense Net interest expense consists of the following: Three Months Ended Nine Months Ended October 3, 2021 September 27, 2020 October 3, 2021 September 27, 2020 Interest expense $ 33,066 $ 39,720 $ 106,597 $ 119,496 Capitalized interest (2,380) (1,664) (7,181) (4,745) Interest expense 30,686 38,056 99,416 114,751 Interest income (532) (798) (1,761) (3,159) Interest expense, net $ 30,154 $ 37,258 $ 97,655 $ 111,592 |
DERIVATIVE INSTRUMENTS
DERIVATIVE INSTRUMENTS | 9 Months Ended |
Oct. 03, 2021 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Derivative Instruments | DERIVATIVE INSTRUMENTS We are exposed to market risks arising principally from changes in foreign currency exchange rates, interest rates and commodity prices. We use certain derivative instruments to manage these risks. These include interest rate swaps to manage interest rate risk, foreign currency forward exchange contracts to manage foreign currency exchange rate risk, and commodities futures and options contracts to manage commodity market price risk exposures. 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. Commodity Price Risk 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. Our open commodity derivative contracts had a notional value of $383,928 as of October 3, 2021 and $279,843 as of December 31, 2020. Derivatives used to manage commodity price risk are not designated for hedge accounting treatment. Therefore, the changes in fair value of these derivatives are recorded as incurred within cost of sales. As discussed in Note 13 , we define our segment income to exclude gains and losses on commodity derivatives until the related inventory is sold, at which time the related gains and losses are reflected within segment income. This enables us to continue to align the derivative gains and losses with the underlying economic exposure being hedged and thereby eliminate the mark-to-market volatility within our reported segment income. Foreign Exchange Price Risk We are exposed to foreign currency exchange rate risk related to our international operations, including non-functional currency intercompany debt and other non-functional currency transactions of certain subsidiaries. Principal currencies hedged include the euro, Canadian dollar, Japanese yen, British pound, Brazilian real, Malaysian ringgit, Mexican peso and Swiss franc. We typically utilize foreign currency forward exchange contracts to hedge these exposures for periods ranging from 3 to 12 months. The contracts are either designated as cash flow hedges or are undesignated. The net notional amount of foreign exchange contracts accounted for as cash flow hedges was $98,949 at October 3, 2021 and $130,131 at December 31, 2020. The effective portion of the changes in fair value on these contracts is recorded in other comprehensive income and reclassified into earnings in the same period in which the hedged transactions affect earnings. The net notional amount of foreign exchange contracts that are not designated as accounting hedges was $2,747 at October 3, 2021 and $2,519 at December 31, 2020. The change in fair value on these instruments is recorded directly in cost of sales or selling, marketing and administrative expense, depending on the nature of the underlying exposure. Interest Rate Risk We manage our targeted mix of fixed and floating rate debt with debt issuances and by entering into fixed-to-floating interest rate swaps in order to mitigate fluctuations in earnings and cash flows that may result from interest rate volatility. These swaps are designated as fair value hedges, for which the gain or loss on the derivative and the offsetting loss or gain on the hedged item are recognized in current earnings as interest expense (income), net. In December 2020, our fixed-to-floating interest rate swap matured in connection with the repayment of certain long-term debt upon its maturity. Therefore, as of October 3, 2021 and December 31, 2020, we had no open interest rate swap derivative instruments in a fair value hedging relationship. In order to manage interest rate exposure, in previous years we utilized interest rate swap agreements to protect against unfavorable interest rate changes relating to forecasted debt transactions. These swaps, which were settled upon issuance of the related debt, were designated as cash flow hedges and the gains and losses that were deferred in other comprehensive income are being recognized as an adjustment to interest expense over the same period that the hedged interest payments affect earnings. Equity Price Risk We are exposed to market price changes in certain broad market indices related to our deferred compensation obligations to our employees. To mitigate this risk, we use equity swap contracts to hedge the portion of the exposure that is linked to market-level equity returns. These contracts are not designated as hedges for accounting purposes and are entered into for periods of 3 to 12 months. The change in fair value of these derivatives is recorded in selling, marketing and administrative expense, together with the change in the related liabilities. The notional amount of the contracts outstanding at October 3, 2021 and December 31, 2020 was $24,866 and $30,194, respectively. The following table presents the classification of derivative assets and liabilities within the Consolidated Balance Sheets as of October 3, 2021 and December 31, 2020: October 3, 2021 December 31, 2020 Assets (1) Liabilities (1) Assets (1) Liabilities (1) Derivatives designated as cash flow hedging instruments: Foreign exchange contracts $ 1,084 $ 1,292 $ 2,388 $ 5,522 Derivatives not designated as hedging instruments: Commodities futures and options (2) 1,924 1,743 3,299 1,648 Deferred compensation derivatives 82 — 3,630 — Foreign exchange contracts 565 — 176 93 2,571 1,743 7,105 1,741 Total $ 3,655 $ 3,035 $ 9,493 $ 7,263 (1) Derivatives assets are classified on our Consolidated Balance Sheets within prepaid expenses and other as well as other non-current assets. Derivative liabilities are classified on our Consolidated Balance Sheets within accrued liabilities and other long-term liabilities. (2) As of October 3, 2021, amounts reflected on a net basis in assets were assets of $63,132 and liabilities of $62,977, which are associated with cash transfers receivable or payable on commodities futures contracts reflecting the change in quoted market prices on the last trading day for the period. The comparable amounts reflected on a net basis in assets at December 31, 2020 were assets of $32,674 and liabilities of $29,376. At October 3, 2021 and December 31, 2020, the remaining amount reflected in assets and liabilities related to the fair value of other non-exchange traded derivative instruments, respectively. Income Statement Impact of Derivative Instruments The effect of derivative instruments on the Consolidated Statements of Income for the three months ended October 3, 2021 and September 27, 2020 was as follows: Non-designated Hedges Cash Flow Hedges Gains (losses) recognized in income (a) Gains (losses) recognized in other comprehensive income (“OCI”) Gains (losses) reclassified from accumulated OCI (“AOCI”) into income (b) 2021 2020 2021 2020 2021 2020 Commodities futures and options $ 33,643 $ 74,279 $ — $ — $ — $ — Foreign exchange contracts 1 1,404 5,779 (807) (2,030) 3 Interest rate swap agreements — — — — (2,679) (2,344) Deferred compensation derivatives 82 2,437 — — — — Total $ 33,726 $ 78,120 $ 5,779 $ (807) $ (4,709) $ (2,341) The effect of derivative instruments on the Consolidated Statements of Income for the nine months ended October 3, 2021 and September 27, 2020 was as follows: Non-designated Hedges Cash Flow Hedges Gains (losses) recognized in income (a) Gains (losses) recognized in OCI Gains (losses) reclassified from AOCI into income (b) 2021 2020 2021 2020 2021 2020 Commodities futures and options $ 64,199 $ (189) $ — $ — $ — $ — Foreign exchange contracts 574 (2,472) (2,200) 5,249 (5,174) 1,393 Interest rate swap agreements — — — — (8,353) (7,031) Deferred compensation derivatives 3,592 1,304 — — — — Total $ 68,365 $ (1,357) $ (2,200) $ 5,249 $ (13,527) $ (5,638) (a) Gains (losses) recognized in income for non-designated commodities futures and options contracts were included in cost of sales. Gains (losses) recognized in income for non-designated foreign currency forward exchange contracts and deferred compensation derivatives were included in selling, marketing and administrative expenses. (b) Gains (losses) reclassified from AOCI into income for foreign currency forward exchange contracts were included in selling, marketing and administrative expenses. Losses reclassified from AOCI into income for interest rate swap agreements were included in interest expense. The amount of pre-tax net losses on derivative instruments, including interest rate swap agreements and foreign currency forward exchange contracts expected to be reclassified into earnings in the next 12 months was approximately $11,529 as of October 3, 2021. This amount is primarily associated with interest rate swap agreements. Fair Value Hedging Relationships For the three and nine months ended October 3, 2021, we had no interest rate swap derivative instruments in a fair value hedging relationship. For the three and nine months ended September 27, 2020, we recognized a net pre-tax benefit to interest expense of $1,389 and $2,148, respectively, relating to our fixed-to-floating interest swap arrangements. |
FAIR VALUE MEASUREMENTS
FAIR VALUE MEASUREMENTS | 9 Months Ended |
Oct. 03, 2021 | |
FAIR VALUE MEASUREMENTS [Abstract] | |
Fair Value Measurements | FAIR VALUE MEASUREMENTS Accounting guidance on fair value measurements requires that financial assets and liabilities be classified and disclosed in one of the following categories of the fair value hierarchy: Level 1 – Based on unadjusted quoted prices for identical assets or liabilities in an active market. Level 2 – Based on observable market-based inputs or unobservable inputs that are corroborated by market data. Level 3 – Based on unobservable inputs that reflect the entity’s own assumptions about the assumptions that a market participant would use in pricing the asset or liability. We did not have any Level 3 financial assets or liabilities, nor were there any transfers between levels during the periods presented. The following table presents assets and liabilities that were measured at fair value in the Consolidated Balance Sheets on a recurring basis as of October 3, 2021 and December 31, 2020: Assets (Liabilities) Level 1 Level 2 Level 3 Total October 3, 2021: Derivative Instruments: Assets: Foreign exchange contracts (1) $ — $ 1,649 $ — $ 1,649 Deferred compensation derivatives (2) — 82 — 82 Commodities futures and options (3) 1,924 — — 1,924 Liabilities: Foreign exchange contracts (1) — 1,292 — 1,292 Commodities futures and options (3) 1,743 — — 1,743 December 31, 2020: Assets: Foreign exchange contracts (1) $ — $ 2,564 $ — $ 2,564 Deferred compensation derivatives (2) — 3,630 — 3,630 Commodities futures and options (3) 3,299 — — 3,299 Liabilities: Foreign exchange contracts (1) — 5,615 — 5,615 Commodities futures and options (3) 1,648 — — 1,648 (1) The fair value of foreign currency forward exchange contracts is the difference between the contract and current market foreign currency exchange rates at the end of the period. We estimate the fair value of foreign currency forward exchange contracts on a quarterly basis by obtaining market quotes of spot and forward rates for contracts with similar terms, adjusted where necessary for maturity differences. (2) The fair value of deferred compensation derivatives is based on quoted prices for market interest rates and a broad market equity index. (3) The fair value of commodities futures and options contracts is based on quoted market prices. Other Financial Instruments The carrying amounts of cash and cash equivalents, accounts receivable, accounts payable and short-term debt approximated fair values as of October 3, 2021 and December 31, 2020 because of the relatively short maturity of these instruments. The estimated fair value of our long-term debt is based on quoted market prices for similar debt issues and is, therefore, classified as Level 2 within the valuation hierarchy. The fair values and carrying values of long-term debt, including the current portion, were as follows: Fair Value Carrying Value October 3, 2021 December 31, 2020 October 3, 2021 December 31, 2020 Current portion of long-term debt $ 2,812 $ 443,215 $ 2,812 $ 438,829 Long-term debt 4,310,889 4,479,499 4,095,159 4,089,755 Total $ 4,313,701 $ 4,922,714 $ 4,097,971 $ 4,528,584 Other Fair Value Measurements In addition to assets and liabilities that are recorded at fair value on a recurring basis, GAAP requires that, under certain circumstances, we also record assets and liabilities at fair value on a nonrecurring basis. In connection with the acquisition of Lily’s in the second quarter of 2021, as discussed in Note 2 , we used various valuation techniques to determine fair value, with the primary techniques being discounted cash flow analysis, relief-from-royalty and a form of the multi-period excess earnings, which use significant unobservable inputs, or Level 3 inputs, as defined by the fair value hierarchy. During the nine months ended October 3, 2021, we recorded no impairment charges. During the nine months ended September 27, 2020, we recorded the following impairment charges, which use significant unobservable inputs, or Level 3 inputs, as defined by the fair value hierarchy: 2020 Adjustment to disposal group (1) $ 6,200 Other asset write-down (2) 2,943 Long-lived asset impairment charges $ 9,143 (1) In connection with the sale of the LSFC joint venture (disposal group previously classified as held for sale), we recorded impairment charges to adjust long-lived asset values. The fair value of the disposal group was supported by potential sales prices with third-party buyers. The sale of the LSFC joint venture was completed in January 2021. (2) In connection with a previous sale, the Company wrote-down certain receivables deemed uncollectible. |
LEASES
LEASES | 9 Months Ended |
Oct. 03, 2021 | |
Leases [Abstract] | |
Leases | LEASES We lease office and retail space, warehouse and distribution facilities, land, vehicles, and equipment. We determine if an agreement is or contains a lease at inception. Leases with an initial term of 12 months or less are not recorded on the balance sheet. Right-of-use (“ROU”) assets represent our right to use an underlying asset for the lease term and lease liabilities represent our obligation to make lease payments arising from the lease. ROU assets and liabilities are based on the estimated present value of lease payments over the lease term and are recognized at the lease commencement date. As most of our leases do not provide an implicit rate, we use our estimated incremental borrowing rate in determining the present value of lease payments. The estimated incremental borrowing rate is derived from information available at the lease commencement date. Our lease terms may include options to extend or terminate the lease when it is reasonably certain that we will exercise that option. A limited number of our lease agreements include rental payments adjusted periodically for inflation. Our lease agreements generally do not contain residual value guarantees or material restrictive covenants. For real estate, equipment and vehicles that support selling, marketing and general administrative activities the Company accounts for the lease and non-lease components as a single lease component. These asset categories comprise the majority of our leases. The lease and non-lease components of real estate and equipment leases supporting production activities are not accounted for as a single lease component. Consideration for such contracts are allocated to the lease component and non-lease components based upon relative standalone prices either observable or estimated if observable prices are not readily available. The components of lease expense for the three months ended October 3, 2021 and September 27, 2020 were as follows: Three Months Ended Lease expense Classification October 3, 2021 September 27, 2020 Operating lease cost Cost of sales or SM&A (1) $ 10,764 $ 11,485 Finance lease cost: Amortization of ROU assets Depreciation and amortization (1) 1,971 1,959 Interest on lease liabilities Interest expense, net 1,100 1,106 Net lease cost (2) $ 13,835 $ 14,550 The components of lease expense for the nine months ended October 3, 2021 and September 27, 2020 were as follows: Nine Months Ended Lease expense Classification October 3, 2021 September 27, 2020 Operating lease cost Cost of sales or SM&A (1) $ 33,318 $ 32,702 Finance lease cost: Amortization of ROU assets Depreciation and amortization (1) 6,032 5,938 Interest on lease liabilities Interest expense, net 3,321 3,340 Net lease cost (2) $ 42,671 $ 41,980 (1) Supply chain-related amounts were included in cost of sales. (2) Net lease cost does not include short-term leases, variable lease costs or sublease income, all of which are immaterial. Information regarding our lease terms and discount rates were as follows: October 3, 2021 December 31, 2020 Weighted-average remaining lease term (years) Operating leases 13.0 12.5 Finance leases 30.6 30.1 Weighted-average discount rate Operating leases 3.7 % 3.8 % Finance leases 5.9 % 5.9 % Supplemental balance sheet information related to leases were as follows: Leases Classification October 3, 2021 December 31, 2020 Assets Operating lease ROU assets Other non-current assets $ 196,746 $ 224,268 Finance lease ROU assets, at cost Property, plant and equipment, gross 98,967 101,426 Accumulated amortization Accumulated depreciation (18,097) (13,361) Finance lease ROU assets, net Property, plant and equipment, net 80,870 88,065 Total leased assets $ 277,616 $ 312,333 Liabilities Current Operating Accrued liabilities $ 25,156 $ 36,578 Finance Current portion of long-term debt 3,533 4,868 Non-current Operating Other long-term liabilities 166,827 181,871 Finance Long-term debt 74,713 75,887 Total lease liabilities $ 270,229 $ 299,204 The maturity of our lease liabilities as of October 3, 2021 were as follows: Operating leases Finance leases Total 2021 (rest of year) $ 9,959 $ 2,165 $ 12,124 2022 28,404 7,352 35,756 2023 20,759 5,255 26,014 2024 15,737 4,687 20,424 2025 14,210 4,720 18,930 Thereafter 160,556 161,336 321,892 Total lease payments 249,625 185,515 435,140 Less: Imputed interest 57,642 107,269 164,911 Total lease liabilities $ 191,983 $ 78,246 $ 270,229 As of October 3, 2021, the Company had entered into an additional lease as a lessee, primarily for real estate. This lease has not yet commenced and will result in ROU assets and corresponding lease liabilities of approximately $22,000. This lease is expected to commence during the fourth quarter of 2021, with a lease term of approximately 8 years. Supplemental cash flow and other information related to leases were as follows: Nine Months Ended October 3, 2021 September 27, 2020 Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows from operating leases $ 32,243 $ 32,010 Operating cash flows from finance leases 3,321 3,341 Financing cash flows from finance leases 3,313 3,136 ROU assets obtained in exchange for lease liabilities: Operating leases $ 7,013 $ 36,629 Finance leases 436 2,076 |
INVESTMENTS IN UNCONSOLIDATED A
INVESTMENTS IN UNCONSOLIDATED AFFILIATES | 9 Months Ended |
Oct. 03, 2021 | |
Business Combinations [Abstract] | |
INVESTMENTS IN UNCONSOLIDATED AFFILIATES | INVESTMENTS IN UNCONSOLIDATED AFFILIATES We invest in partnerships that make equity investments in projects eligible to receive federal historic and renewable energy tax credits. The tax credits, when realized, are recognized as a reduction of tax expense under the flow-through method, at which time the corresponding equity investment is written-down to reflect the remaining value of the future benefits to be realized. The equity investment write-down is reflected within other (income) expense, net in the Consolidated Statements of Income (see Note 18 ). Additionally, we acquire ownership interests in emerging snacking businesses and startup companies, which vary in method of accounting based on our percentage of ownership and ability to exercise significant influence over decisions relating to operating and financial affairs. These investments afford the Company the rights to distribute brands that the Company does not own to third-party customers primarily in North America. Net sales and expenses of our equity method investees are not consolidated into our financial statements; rather, our proportionate share of earnings or losses are recorded on a net basis within other (income) expense, net in the Consolidated Statements of Income. Both equity and cost method investments are reported within other non-current assets in our Consolidated Balance Sheets. We regularly review our investments and adjust accordingly for capital contributions, dividends received and other-than-temporary impairments. Total investments in unconsolidated affiliates was $77,865 and $52,351 as of October 3, 2021 and December 31, 2020, respectively. |
BUSINESS REALIGNMENT ACTIVITIES
BUSINESS REALIGNMENT ACTIVITIES | 3 Months Ended |
Oct. 03, 2021 | |
Restructuring and Related Activities [Abstract] | |
Business Realignment Activities | BUSINESS REALIGNMENT ACTIVITIES We periodically undertake business realignment activities designed to increase our efficiency and focus our business in support of our key growth strategies. Costs associated with business realignment activities are classified in our Consolidated Statements of Income as follows: Three Months Ended Nine Months Ended October 3, 2021 September 27, 2020 October 3, 2021 September 27, 2020 Cost of sales $ 213 $ — $ 5,250 $ — Selling, marketing and administrative expense 2,819 — 5,795 2,645 Business realignment costs (benefits) 365 — 2,748 (475) Costs associated with business realignment activities $ 3,397 $ — $ 13,793 $ 2,170 Costs recorded by program during the nine months ended October 3, 2021 and September 27, 2020 related to these activities were as follows: Three Months Ended Nine Months Ended October 3, 2021 September 27, 2020 October 3, 2021 September 27, 2020 International Optimization Program: Severance $ 377 $ — $ 3,199 $ — Other program costs 3,020 — 10,594 — Margin for Growth Program: Severance — — — (653) Other program costs — — — 2,823 Total $ 3,397 $ — $ 13,793 $ 2,170 The following table presents the liability activity for costs qualifying as exit and disposal costs for the nine months ended October 3, 2021: Total Liability balance at December 31, 2020 (1) $ 12,748 2021 business realignment charges (2) 6,828 Cash payments (18,767) Liability balance at October 3, 2021 (1) $ 809 (1) The liability balances reflected above are reported within accrued liabilities and other long-term liabilities. (2) The costs reflected in the liability roll-forward represent employee-related and certain third-party service provider charges. 2020 International Optimization Program In the fourth quarter of 2020, we commenced a program (“International Optimization Program”) to streamline resources and investments in select international markets, including the optimization of our China operating model that will improve our operational efficiency and provide for a strong, sustainable and simplified base going forward. The International Optimization Program is expected to be completed by mid-2022, with total pre-tax costs anticipated to be $50,000 to $75,000. Cash costs are expected to be $40,000 to $65,000, primarily related to workforce reductions of approximately 350 positions outside of the United States, costs to consolidate and relocate production, and third-party costs incurred to execute these activities. The costs and related benefits of the International Optimization Program relate to the International and Other segment. However, segment operating results do not include these business realignment expenses because we evaluate segment performance excluding such costs. For the three and nine months ended October 3, 2021, we recognized total costs associated with the International Optimization Program of $3,397 and $13,793, respectively. These charges predominantly included third-party charges in support of our initiative to transform our China operating model, as well as severance and employee benefit costs. Since inception, we have incurred pre-tax charges to execute the program totaling $43,136. Margin for Growth Program In the first quarter of 2017, the Company’s Board of Directors (“Board”) unanimously approved several initiatives under a single program focused on improving global efficiency and effectiveness, optimizing the Company’s supply chain, streamlining the Company’s operating model and reducing administrative expenses to generate long-term savings. This project was completed in mid-2020. We recognized total costs of $2,170 associated with the Margin for Growth Program for the six months ended June 28, 2020, at which time the program ended. These charges included employee severance, largely relating to initiatives to improve the cost structure of our corporate operating model as part of optimizing our global supply chain. In addition, we incurred other program costs, which related primarily to third-party charges in support of our initiative to improve global efficiency and effectiveness. The costs and related benefits of the Margin for Growth Program relate approximately 63% to the North America segment and 37% to the International and Other segment. However, segment operating results do not include these business realignment expenses because we evaluate segment performance excluding such costs. |
INCOME TAXES
INCOME TAXES | 9 Months Ended |
Oct. 03, 2021 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | INCOME TAXES The majority of our taxable income is generated in the United States and taxed at the United States statutory rate of 21%. The effective tax rates for the nine months ended October 3, 2021 and September 27, 2020 were 21.4% and 20.1%, respectively. Relative to the statutory rate, the 2021 effective tax rate was impacted by incremental tax reserves incurred as a result of an adverse ruling in connection with a non-U.S. tax litigation matter as well as state taxes, partially offset by investment tax credits and the utilization (during the third quarter of 2021) of previously generated capital losses. The Company and its subsidiaries file tax returns in the United States, including various state and local returns, and in other foreign jurisdictions. We are routinely audited by taxing authorities in our filing jurisdictions, and a number of these disputes are currently underway, including multi-year controversies at various stages of review, negotiation and litigation in Malaysia, Mexico, and the United States. The outcome of tax audits cannot be predicted with certainty, including the timing of resolution or potential settlements. If any issues addressed in our tax audits are resolved in a manner not consistent with management’s expectations, we could be required to adjust our provision for income taxes in the period such resolution occurs. Based on our current assessments, we believe adequate provision has been made for all income tax uncertainties. We reasonably expect reductions in the liability for unrecognized tax benefits of approximately $12,619 within the next 12 months because of the expiration of statutes of limitations and settlements of tax audits. American Rescue Plan Act On March 11, 2021, the American Rescue Plan Act (“ARPA”) was signed into law. The ARPA strengthens and extends certain federal programs enacted through the Coronavirus Aid, Relief, and Economic Security Act and other COVID-19 relief measures, and establishes new federal programs, including provisions on taxes, healthcare and unemployment benefits. The ARPA did not have a material impact on our consolidated financial statements for the nine months ended October 3, 2021. Coronavirus Aid, Relief, and Economic Security Act On March 27, 2020, the Coronavirus Aid, Relief, and Economic Security (“CARES”) Act was signed into law. The CARES Act provides a substantial stimulus and assistance package intended to address the impact of the COVID-19 pandemic, including tax relief and government loans, grants and investments. The CARES Act did not have a material impact on our consolidated financial statements for the nine months ended October 3, 2021 and September 27, 2020. |
PENSION AND OTHER POST-RETIREME
PENSION AND OTHER POST-RETIREMENT BENEFIT PLANS | 9 Months Ended |
Oct. 03, 2021 | |
Retirement Benefits [Abstract] | |
Pension and Other Post-Retirement Benefit Plans | PENSION AND OTHER POST-RETIREMENT BENEFIT PLANS Net Periodic Benefit Cost The components of net periodic benefit cost for the three months ended October 3, 2021 and September 27, 2020 were as follows: Pension Benefits Other Benefits Three Months Ended Three Months Ended October 3, 2021 September 27, 2020 October 3, 2021 September 27, 2020 Service cost $ 5,256 $ 5,431 $ 45 $ 39 Interest cost 4,785 6,125 964 1,508 Expected return on plan assets (12,249) (13,243) — — Amortization of prior service (credit) cost (1,536) (1,823) — 75 Amortization of net loss (gain) 4,585 7,026 — (10) Settlement loss 5,408 1,282 — — Total net periodic benefit cost $ 6,249 $ 4,798 $ 1,009 $ 1,612 We made contributions of $25,711 and $3,527 to the pension plans and other benefits plans, respectively, during the third quarter of 2021. In the third quarter of 2020, we made contributions of $748 and $3,157 to our pension plans and other benefit plans, respectively. The contributions in 2021 and 2020 also included benefit payments from our non-qualified pension plans and post-retirement benefit plans. The components of net periodic benefit cost for the nine months ended October 3, 2021 and September 27, 2020 were as follows: Pension Benefits Other Benefits Nine Months Ended Nine Months Ended October 3, 2021 September 27, 2020 October 3, 2021 September 27, 2020 Service cost $ 16,178 $ 16,274 $ 135 $ 119 Interest cost 13,511 20,081 2,893 4,520 Expected return on plan assets (36,861) (39,553) — — Amortization of prior service (credit) cost (4,607) (5,474) — 225 Amortization of net loss (gain) 16,005 20,190 — (29) Settlement loss 12,848 4,935 — — Total net periodic benefit cost $ 17,074 $ 16,453 $ 3,028 $ 4,835 We made contributions of $26,894 and $11,682 to the pension plans and other benefits plans, respectively, during the first nine months of 2021. In the first nine months of 2020, we made contributions of $1,753 and $10,485 to our pension plans and other benefit plans, respectively. The contributions in 2021 and 2020 also included benefit payments from our non-qualified pension plans and post-retirement benefit plans. The non-service cost components of net periodic benefit cost relating to pension and other post-retirement benefit plans is reflected within other (income) expense, net in the Consolidated Statements of Income (see Note 18 ). |
STOCK COMPENSATION PLANS
STOCK COMPENSATION PLANS | 9 Months Ended |
Oct. 03, 2021 | |
Share-based Payment Arrangement [Abstract] | |
Stock Compensation Plans | STOCK COMPENSATION PLANS Share-based grants for compensation and incentive purposes are made pursuant to the Equity and Incentive Compensation Plan (“EICP”). 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: • Non-qualified stock options (“stock options”); • Performance stock units (“PSUs”) and performance stock; • Stock appreciation rights; • Restricted stock units (“RSUs”) and restricted stock; and • 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 PSU and RSU 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 RSUs awarded that they elect to convert into deferred stock units under our Directors’ Compensation Plan. At the time stock options are exercised or PSUs and RSUs become payable, Common Stock is issued from our accumulated treasury shares. Dividend equivalents are credited on RSUs on the same date and at the same rate as dividends paid on our Common Stock. Dividend equivalents are charged to retained earnings and included in accrued liabilities until paid. Awards to employees eligible for retirement prior to the award becoming fully vested are amortized to expense over the period through the date that the employee first becomes eligible to retire and is no longer required to provide service to earn the award. In addition, historical data is used to estimate forfeiture rates and record share-based compensation expense only for those awards that are expected to vest. For the periods presented, compensation expense for all types of stock-based compensation programs and the related income tax benefit recognized were as follows: Three Months Ended Nine Months Ended October 3, 2021 September 27, 2020 October 3, 2021 September 27, 2020 Pre-tax compensation expense $ 18,527 $ 12,407 $ 51,009 $ 37,897 Related income tax benefit 2,791 2,723 10,814 7,617 Compensation expenses for stock compensation plans are primarily included in selling, marketing and administrative expense. As of October 3, 2021, total stock-based compensation expense related to non-vested awards not yet recognized was $93,180 and the weighted-average period over which this amount is expected to be recognized was approximately 2.1 years. Stock Options The exercise price of each stock option awarded under the EICP equals the closing price of our Common Stock on the New York Stock Exchange on the date of grant. Each stock option has a maximum term of 10 years. Grants of stock options provide for pro-rated vesting, typically over a four-year period. Expense for stock options is based on grant date fair value and recognized on a straight-line method over the vesting period, net of estimated forfeitures. A summary of activity relating to grants of stock options for the period ended October 3, 2021 is as follows: Stock Options Shares Weighted-Average Weighted-Average Remaining Aggregate Intrinsic Value Outstanding at beginning of the period 1,839,811 $99.72 4.8 years Granted 32,155 $147.98 Exercised (420,520) $96.03 Forfeited (3,009) $102.58 Outstanding as of October 3, 2021 1,448,437 $101.85 4.5 years $ 99,836 Options exercisable as of October 3, 2021 1,264,140 $100.37 4.2 years $ 89,006 The weighted-average fair value of options granted was $24.12 and $21.31 per share for the periods ended October 3, 2021 and September 27, 2020, respectively. The fair value was estimated on the date of grant using a Black-Scholes option-pricing model and the following weighted-average assumptions: Nine Months Ended October 3, 2021 September 27, 2020 Dividend yields 2.2 % 2.1 % Expected volatility 21.8 % 17.5 % Risk-free interest rates 1.0 % 1.3 % Expected term in years 6.3 6.7 The total intrinsic value of options exercised was $28,416 and $27,394 for the periods ended October 3, 2021 and September 27, 2020, respectively. Performance Stock Units and Restricted Stock Units Under the EICP, we grant PSUs to select executives and other key employees. Vesting is contingent upon the achievement of certain performance objectives. We grant PSUs over three-year performance cycles. If we meet targets for financial measures at the end of the applicable three-year performance cycle, we award a resulting number of shares of our Common Stock to the participants. The number of shares may be increased to the maximum or reduced to the minimum threshold based on the results of these performance metrics in accordance with the terms established at the time of the award. For PSUs granted, the target award is a combination of a market-based total shareholder return and performance-based components. For market-based condition components, market volatility and other factors are taken into consideration in determining the grant date fair value and the related compensation expense is recognized regardless of whether the market condition is satisfied, provided that the requisite service has been provided. For performance-based condition components, we estimate the probability that the performance conditions will be achieved each quarter and adjust compensation expenses accordingly. The performance scores of PSU grants during the nine months ended October 3, 2021 and September 27, 2020 can range from 0% to 250% of the targeted amounts. We recognize the compensation expenses associated with PSUs ratably over the three-year term. Compensation expenses are 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 Common Stock on the date of grant for performance-based components. During the nine months ended October 3, 2021 and September 27, 2020, we awarded RSUs to certain executive officers and other key employees under the EICP. We also awarded RSUs to non-employee directors. We recognize the compensation expenses associated with employee RSUs over a specified award vesting period based on the grant date fair value of our Common Stock. We recognize expense for employee RSUs based on the straight-line method. The compensation expenses associated with non-employee director RSUs is recognized ratably over the vesting period, net of estimated forfeitures. A summary of activity relating to grants of PSUs and RSUs for the period ended October 3, 2021 is as follows: Performance Stock Units and Restricted Stock Units Number of units Weighted-average grant date fair value for equity awards (per unit) Outstanding at beginning of year 1,053,332 $135.11 Granted 392,419 $153.97 Performance assumption change (1) 215,725 $147.96 Vested (331,454) $116.59 Forfeited (44,899) $148.39 Outstanding as of October 3, 2021 1,285,123 $146.64 (1) Reflects the net number of PSUs above and below target levels based on the performance metrics. The following table sets forth information about the fair value of the PSUs and RSUs granted for potential future distribution to employees and non-employee directors. In addition, the table provides assumptions used to determine the fair value of the market-based total shareholder return component using the Monte Carlo simulation model on the date of grant. Nine Months Ended October 3, 2021 September 27, 2020 Units granted 392,419 340,526 Weighted-average fair value at date of grant $ 153.97 $ 162.08 Monte Carlo simulation assumptions: Estimated values $ 66.44 $ 80.08 Dividend yields 2.2 % 2.0 % Expected volatility 26.4 % 17.3 % The fair value of shares vested totaled $50,361 and $52,181 for the periods ended October 3, 2021 and September 27, 2020, respectively. Deferred PSUs, deferred RSUs and deferred stock units representing directors’ fees totaled 263,594 units as of October 3, 2021. Each unit is equivalent to one share of the Company’s Common Stock. |
SEGMENT INFORMATION
SEGMENT INFORMATION | 9 Months Ended |
Oct. 03, 2021 | |
Segment Reporting [Abstract] | |
Segment Information | SEGMENT INFORMATION Our organizational structure is designed to ensure continued focus on North America, coupled with an emphasis on profitable growth in our focus international markets. Our business is primarily organized around geographic regions, which enables us to build processes for repeatable success in our global markets. As a result, we have defined our operating segments on a geographic basis, as this aligns with how our Chief Operating Decision Maker (“CODM”) manages our business, including resource allocation and performance assessment. Our North America business, which generates approximately 90% of our consolidated revenue, is our only individually reportable segment. None of our other operating segments individually meet the quantitative thresholds to qualify as reportable segments; therefore, these operating segments are combined and disclosed below as International and Other. • North America - This segment is responsible for our traditional chocolate and non-chocolate confectionery market position, as well as our grocery and growing snacks market positions, in the United States and Canada. This includes developing and growing our business in chocolate and non-chocolate confectionery, pantry, food service and other snacking product lines. • International and Other - International and Other is a combination of all other operating segments that are not individually material, including those geographic regions where we operate outside of North America. We currently have operations and manufacture product in Mexico, Brazil, India and Malaysia, primarily for consumers in these regions, and also distribute and sell confectionery products in export markets of Asia, Latin America, Middle East, Europe, Africa and other regions. This segment also includes our global retail operations, including Hershey’s Chocolate World stores in Hershey, Pennsylvania, New York City, Las Vegas, Niagara Falls (Ontario) and Singapore, as well as operations associated with licensing the use of certain of the Company’s trademarks and products to third parties around the world. For segment reporting purposes, we use “segment income” to evaluate segment performance and allocate resources. Segment income excludes unallocated general corporate administrative expenses, unallocated mark-to-market gains and losses on commodity derivatives, business realignment and impairment charges, acquisition-related costs and other unusual gains or losses that are not part of our measurement of segment performance. These items of our operating income are managed centrally at the corporate level and are excluded from the measure of segment income reviewed by the CODM as well as the measure of segment performance used for incentive compensation purposes. As discussed in Note 5 , derivatives used to manage commodity price risk are not designated for hedge accounting treatment. These derivatives are recognized at fair market value with the resulting realized and unrealized (gains) losses recognized in unallocated derivative (gains) losses outside of the reporting segment results until the related inventory is sold, at which time the related gains and losses are reallocated to segment income. This enables us to align the derivative gains and losses with the underlying economic exposure being hedged and thereby eliminate the mark-to-market volatility within our reported segment income. Certain manufacturing, warehousing, distribution and other activities supporting our global operations are integrated to maximize efficiency and productivity. As a result, assets and capital expenditures are not managed on a segment basis and are not included in the information reported to the CODM for the purpose of evaluating performance or allocating resources. We disclose depreciation and amortization that is generated by segment-specific assets, since these amounts are included within the measure of segment income reported to the CODM. Our segment net sales and earnings were as follows: Three Months Ended Nine Months Ended October 3, 2021 September 27, 2020 October 3, 2021 September 27, 2020 Net sales: North America $ 2,125,627 $ 2,014,152 $ 5,986,692 $ 5,442,760 International and Other 234,212 205,677 658,517 521,715 Total $ 2,359,839 $ 2,219,829 $ 6,645,209 $ 5,964,475 Segment income: North America $ 666,089 $ 647,109 $ 1,893,554 $ 1,726,251 International and Other 38,699 24,477 114,722 36,512 Total segment income 704,788 671,586 2,008,276 1,762,763 Unallocated corporate expense (1) 145,028 131,934 434,070 363,384 Unallocated mark-to-market (gains) losses on commodity derivatives (18,468) (71,758) (24,137) 10,483 Long-lived asset impairment charges (see Note 6 ) — — — 9,143 Costs associated with business realignment activities (see Note 9 ) 3,397 — 13,793 2,170 Operating profit 574,831 611,410 1,584,550 1,377,583 Interest expense, net (see Note 4 ) 30,154 37,258 97,655 111,592 Other (income) expense, net (see Note 18 ) 23,004 11,644 32,612 34,394 Income before income taxes $ 521,673 $ 562,508 $ 1,454,283 $ 1,231,597 (1) Includes centrally-managed (a) corporate functional costs relating to legal, treasury, finance, and human resources, (b) expenses associated with the oversight and administration of our global operations, including warehousing, distribution and manufacturing, information systems and global shared services, (c) non-cash stock-based compensation expense, (d) acquisition-related costs, and (e) other gains or losses that are not integral to segment performance. Activity within the unallocated mark-to-market adjustment for commodity derivatives is as follows: Three Months Ended Nine Months Ended October 3, 2021 September 27, 2020 October 3, 2021 September 27, 2020 Net (gains) losses on mark-to-market valuation of commodity derivative positions recognized in income $ (33,643) $ (74,279) $ (64,199) $ 189 Net gains on commodity derivative positions reclassified from unallocated to segment income 15,175 2,521 40,062 10,294 Net (gains) losses on mark-to-market valuation of commodity derivative positions recognized in unallocated derivative (gains) losses $ (18,468) $ (71,758) $ (24,137) $ 10,483 As of October 3, 2021, the cumulative amount of mark-to-market gains on commodity derivatives that have been recognized in our consolidated cost of sales and not yet allocated to reportable segments was $86,675. Based on our forecasts of the timing of the recognition of the underlying hedged items, we expect to reclassify net pre-tax gains on commodity derivatives of $57,391 to segment operating results in the next twelve months. Depreciation and amortization expense included within segment income presented above is as follows: Three Months Ended Nine Months Ended October 3, 2021 September 27, 2020 October 3, 2021 September 27, 2020 North America $ 59,216 $ 56,518 $ 175,238 $ 164,599 International and Other 6,439 6,956 20,187 21,202 Corporate 12,368 11,691 36,528 31,888 Total $ 78,023 $ 75,165 $ 231,953 $ 217,689 Additional information regarding our net sales disaggregated by geographical region is as follows: Three Months Ended Nine Months Ended October 3, 2021 September 27, 2020 October 3, 2021 September 27, 2020 Net sales: United States $ 2,017,378 $ 1,914,316 $ 5,681,498 $ 5,185,858 All other countries 342,461 305,513 963,711 778,617 Total $ 2,359,839 $ 2,219,829 $ 6,645,209 $ 5,964,475 The majority of our products are confectionery or confectionery-based and include chocolate and non-chocolate confectionery products, gum and mint refreshment products, spreads, snack bites and mixes, as well as pantry items such as baking ingredients, toppings and sundae syrups. Our snacks portfolio includes ready-to-eat popcorn, baked and trans fat free snacks, protein bars and other better-for-you snacks. Additional information regarding our net sales disaggregated by product line is as follows: Three Months Ended Nine Months Ended October 3, 2021 September 27, 2020 October 3, 2021 September 27, 2020 Net sales: Confectionery and confectionery-based portfolio $ 2,190,223 $ 2,078,582 $ 6,183,741 $ 5,578,997 Snacks portfolio 169,616 141,247 461,468 385,478 Total $ 2,359,839 $ 2,219,829 $ 6,645,209 $ 5,964,475 |
TREASURY STOCK ACTIVITY TREASUR
TREASURY STOCK ACTIVITY TREASURY STOCK ACTIVITY (Notes) | 9 Months Ended |
Oct. 03, 2021 | |
Equity [Abstract] | |
Treasury Stock Activity | TREASURY STOCK ACTIVITY A summary of our treasury stock activity is as follows: Nine Months Ended October 3, 2021 Shares Dollars In thousands Shares repurchased in the open market under pre-approved share repurchase programs 871,144 $ 150,017 Shares repurchased to replace Treasury Stock issued for stock options and incentive compensation 2,005,500 $ 307,929 Total share repurchases 2,876,644 457,946 Shares issued for stock options and incentive compensation (637,580) (26,529) Net change 2,239,064 $ 431,417 In July 2018, our Board of Directors approved a $500,000 share repurchase authorization to repurchase shares of our Common Stock. As of October 3, 2021, $109,983 remained available for repurchases of our Common Stock under this program. In May 2021, our Board of Directors approved an additional $500,000 share repurchase authorization. This program is to commence after the existing 2018 authorization is completed and is to be utilized at management’s discretion. We are authorized to purchase our outstanding shares in open market and privately negotiated transactions. The program has no expiration date and acquired shares of Common Stock will be held as treasury shares. Purchases under approved share repurchase authorizations are in addition to our practice of buying back shares sufficient to offset those issued under incentive compensation plans. |
NONCONTROLLING INTEREST
NONCONTROLLING INTEREST | 9 Months Ended |
Oct. 03, 2021 | |
Equity [Abstract] | |
Noncontrolling Interest | NONCONTROLLING INTEREST Noncontrolling Interest in Subsidiary As discussed in Note 2 , in January 2021 we completed the divestiture of LSFC, a joint venture originally established in 2007 in China for the purpose of manufacturing and selling product to the joint venture partners. Prior to the sale, we owned a 50% controlling interest in LSFC. A roll-forward showing the 2021 activity relating to the noncontrolling interest follows: Noncontrolling Interest Balance, December 31, 2020 $ 3,531 Net gain attributable to noncontrolling interest 1,072 Divestiture of noncontrolling interest (1,013) Other comprehensive income - foreign currency translation adjustments 5,249 Balance, October 3, 2021 $ 8,839 |
CONTINGENCIES
CONTINGENCIES | 9 Months Ended |
Oct. 03, 2021 | |
Commitments and Contingencies Disclosure [Abstract] | |
Contingencies | CONTINGENCIES We are subject to various pending or threatened legal proceedings and claims that arise in the ordinary course of our business. While it is not feasible to predict or determine the outcome of such proceedings and claims with certainty, in our opinion these matters, both individually and in the aggregate, are not expected to have a material effect on our financial condition, results of operations or cash flows. |
EARNINGS PER SHARE
EARNINGS PER SHARE | 9 Months Ended |
Oct. 03, 2021 | |
Earnings Per Share [Abstract] | |
Earnings Per Share | EARNINGS PER SHARE We compute basic earnings per share for Common Stock and Class B common stock using the two-class method. The Class B common stock is convertible into Common Stock on a share-for-share basis at any time. The computation of diluted earnings per share for Common Stock assumes the conversion of Class B common stock using the if-converted method, while the diluted earnings per share of Class B common stock does not assume the conversion of those shares. Three Months Ended October 3, 2021 September 27, 2020 Common Stock Class B Common Stock Common Stock Class B Common Stock Basic earnings per share: Numerator: Allocation of distributed earnings (cash dividends paid) $ 131,247 $ 49,643 $ 119,431 $ 44,308 Allocation of undistributed earnings 191,575 72,462 206,491 77,053 Total earnings—basic $ 322,822 $ 122,105 $ 325,922 $ 121,361 Denominator (shares in thousands): Total weighted-average shares—basic 145,665 60,614 147,688 60,614 Earnings Per Share—basic $ 2.22 $ 2.01 $ 2.21 $ 2.00 Diluted earnings per share: Numerator: Allocation of total earnings used in basic computation $ 322,822 $ 122,105 $ 325,922 $ 121,361 Reallocation of total earnings as a result of conversion of Class B common stock to Common stock 122,105 — 121,361 — Reallocation of undistributed earnings — (369) — (317) Total earnings—diluted $ 444,927 $ 121,736 $ 447,283 $ 121,044 Denominator (shares in thousands): Number of shares used in basic computation 145,665 60,614 147,688 60,614 Weighted-average effect of dilutive securities: Conversion of Class B common stock to Common shares outstanding 60,614 — 60,614 — Employee stock options 625 — 557 — Performance and restricted stock units 522 — 281 — Total weighted-average shares—diluted 207,426 60,614 209,140 60,614 Earnings Per Share—diluted $ 2.14 $ 2.01 $ 2.14 $ 2.00 There were no antidilutive stock options for the three months ended October 3, 2021. The earnings per share calculations for the three months ended September 27, 2020 excluded 15,000 stock options that would have been antidilutive. Nine Months Ended October 3, 2021 September 27, 2020 Common Stock Class B Common Stock Common Stock Class B Common Stock Basic earnings per share: Numerator: Allocation of distributed earnings (cash dividends paid) $ 366,934 $ 138,260 $ 348,608 $ 129,410 Allocation of undistributed earnings 462,505 174,257 371,084 138,219 Total earnings—basic $ 829,439 $ 312,517 $ 719,692 $ 267,629 Denominator (shares in thousands): Total weighted-average shares—basic 146,259 60,614 147,845 60,614 Earnings Per Share—basic $ 5.67 $ 5.16 $ 4.87 $ 4.42 Diluted earnings per share: Numerator: Allocation of total earnings used in basic computation $ 829,439 $ 312,517 $ 719,692 $ 267,629 Reallocation of total earnings as a result of conversion of Class B common stock to Common stock 312,517 — 267,629 — Reallocation of undistributed earnings — (847) — (654) Total earnings—diluted $ 1,141,956 $ 311,670 $ 987,321 $ 266,975 Denominator (shares in thousands): Number of shares used in basic computation 146,259 60,614 147,845 60,614 Weighted-average effect of dilutive securities: Conversion of Class B common stock to Common shares outstanding 60,614 — 60,614 — Employee stock options 613 — 599 — Performance and restricted stock units 371 — 366 — Total weighted-average shares—diluted 207,857 60,614 209,424 60,614 Earnings Per Share—diluted $ 5.49 $ 5.14 $ 4.71 $ 4.40 The earnings per share calculations for the nine months ended October 3, 2021 and September 27, 2020 excluded 43,000 and 15,000 stock options, respectively, that would have been antidilutive. |
OTHER (INCOME) EXPENSE, NET OTH
OTHER (INCOME) EXPENSE, NET OTHER (INCOME) EXPENSE, NET | 9 Months Ended |
Oct. 03, 2021 | |
Other Income and Expenses [Abstract] | |
Other (Income) Expense, Net | OTHER (INCOME) EXPENSE, NET Other (income) expense, net reports certain gains and losses associated with activities not directly related to our core operations. A summary of the components of other (income) expense, net is as follows: Three Months Ended Nine Months Ended October 3, 2021 September 27, 2020 October 3, 2021 September 27, 2020 Write-down of equity investments in partnerships qualifying for historic and renewable energy tax credits (see Note 8 ) $ 20,963 $ 10,707 $ 28,734 $ 29,257 Non-service cost components of net periodic benefit cost relating to pension and other post-retirement benefit plans (see Note 11 ) 1,952 940 3,772 4,895 Other (income) expense, net 89 (3) 106 242 Total $ 23,004 $ 11,644 $ 32,612 $ 34,394 |
SUPPLEMENTAL BALANCE SHEET INFO
SUPPLEMENTAL BALANCE SHEET INFORMATION | 9 Months Ended |
Oct. 03, 2021 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Supplemental Balance Sheet Information | SUPPLEMENTAL BALANCE SHEET INFORMATION The components of certain Consolidated Balance Sheet accounts are as follows: October 3, 2021 December 31, 2020 Inventories: Raw materials $ 403,374 $ 388,600 Goods in process 131,523 104,841 Finished goods 662,073 645,664 Inventories at First In First Out 1,196,970 1,139,105 Adjustment to Last In First Out (170,429) (174,898) Total inventories $ 1,026,541 $ 964,207 Prepaid expenses and other: Prepaid expenses $ 68,242 $ 95,669 Other current assets 130,418 158,809 Total prepaid expenses and other $ 198,660 $ 254,478 Property, plant and equipment: Land $ 148,283 $ 131,513 Buildings 1,466,156 1,387,106 Machinery and equipment 3,267,233 3,169,754 Construction in progress 254,879 276,514 Property, plant and equipment, gross 5,136,551 4,964,887 Accumulated depreciation (2,766,358) (2,679,632) Property, plant and equipment, net $ 2,370,193 $ 2,285,255 Other non-current assets: Capitalized software, net $ 232,367 $ 187,673 Operating lease ROU assets 196,746 224,268 Investments in unconsolidated affiliates 77,865 52,351 Other non-current assets 121,708 91,595 Total other non-current assets $ 628,686 $ 555,887 Accrued liabilities: Payroll, compensation and benefits $ 237,934 $ 237,342 Advertising, promotion and product allowances 323,903 309,537 Operating lease liabilities 25,156 36,578 Other 164,979 198,309 Total accrued liabilities $ 751,972 $ 781,766 Other long-term liabilities: Post-retirement benefits liabilities $ 214,954 $ 223,507 Pension benefits liabilities 46,183 70,727 Operating lease liabilities 166,827 181,871 Other 211,932 207,329 Total other long-term liabilities $ 639,896 $ 683,434 Accumulated other comprehensive loss: Foreign currency translation adjustments $ (95,941) $ (98,525) Pension and post-retirement benefit plans, net of tax (165,621) (194,205) Cash flow hedges, net of tax (36,838) (45,352) Total accumulated other comprehensive loss $ (298,400) $ (338,082) |
SUMMARY OF SIGNIFICANT ACCOUN_2
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 9 Months Ended |
Oct. 03, 2021 | |
Accounting Policies [Abstract] | |
Basis of Presentation | Basis of Presentation The unaudited consolidated financial statements provided in this report include the accounts of The Hershey Company (the “Company,” “Hershey,” “we” or “us”) 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 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. We use the equity method of accounting when we have a 20% to 50% interest in other companies and exercise significant influence. Other investments that are not controlled, and over which we do not have the ability to exercise significant influence, are accounted for under the cost method. Both equity and cost method investments are included as Other non-current assets in the Consolidated Balance Sheets. The financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) for interim financial reporting and with the rules and regulations for reporting on Form 10-Q. Accordingly, they do not contain certain information and disclosures required by GAAP for comprehensive financial statements. The financial statements reflect all adjustments (consisting of normal recurring adjustments) which are, in our opinion, necessary for a fair presentation of the results of operations, financial position, and cash flows for the indicated periods. |
Recent Accounting Pronouncements | Recent Accounting Pronouncements Recently Adopted Accounting Pronouncements In December 2019, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2019-12, Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes . This ASU is intended to simplify various aspects related to accounting for income taxes by removing certain exceptions to the general principles in Topic 740 and clarifying certain aspects of the current guidance to promote consistency among reporting entities. ASU 2019-12 is effective for annual periods beginning after December 15, 2020 and interim periods within those annual periods, with early adoption permitted. An entity that elects early adoption must adopt all the amendments in the same period. Most amendments within this ASU are required to be applied on a prospective basis, while certain amendments must be applied on a retrospective or modified retrospective basis. We adopted the provisions of this ASU in the fourth quarter of 2020. Adoption of the new standard did not have a material impact on our consolidated financial statements. Recently Issued Accounting Pronouncements Not Yet Adopted In March 2020, the FASB issued ASU No. 2020-04, Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting . The ASU is intended to provide temporary optional expedients and exceptions to the GAAP guidance on contract modifications and hedge accounting to ease the financial reporting burdens related to the expected market transition from the London Interbank Offered Rate (LIBOR) and other interbank offered rates to alternative reference rates. Entities may apply this ASU upon issuance through December 31, 2022 on a prospective basis. We are currently evaluating the impact of the new standard on our consolidated financial statements and related disclosures. No other new accounting pronouncement issued or effective during the fiscal year had or is expected to have a material impact on our consolidated financial statements or disclosures. |
BUSINESS ACQUISITION AND DIVE_2
BUSINESS ACQUISITION AND DIVESTITURES (Tables) | 9 Months Ended |
Oct. 03, 2021 | |
Business Combinations [Abstract] | |
Schedule of Purchase Consideration Allocation to Assets Acquired and Liabilities Assumed | The purchase consideration, inclusive of the acquisition date fair value of the contingent consideration, was allocated to assets acquired and liabilities assumed based on their respective fair values as follows: Initial Allocation (1) Adjustments Updated Allocation Goodwill $ 174,516 $ 1,310 $ 175,826 Other intangible assets 235,800 — 235,800 Other assets acquired, primarily current assets 30,383 2,709 33,092 Other liabilities assumed, primarily current liabilities (9,620) — (9,620) Deferred income taxes (7,888) — (7,888) Net assets acquired $ 423,191 $ 4,019 $ 427,210 (1) As reported in the Company’s Quarterly Report on Form 10-Q for the quarterly period ended July 4, 2021. |
GOODWILL AND INTANGIBLE ASSETS
GOODWILL AND INTANGIBLE ASSETS (Tables) | 9 Months Ended |
Oct. 03, 2021 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of the Changes in the Carrying Value of Goodwill by Reportable Segment | The changes in the carrying value of goodwill by reportable segment for the nine months ended October 3, 2021 are as follows: North America International Total Balance at December 31, 2020 $ 1,970,445 $ 17,770 $ 1,988,215 Acquired during the period (see Note 2 ) 174,516 — 174,516 Measurement period adjustments (see Note 2 ) 1,310 — 1,310 Foreign currency translation 937 (398) 539 Balance at October 3, 2021 $ 2,147,208 $ 17,372 $ 2,164,580 |
Schedule of Gross Carrying Amount and Accumulated Amortization for Each Major Class of Intangible Asset | The following table provides the gross carrying amount and accumulated amortization for each major class of intangible asset: October 3, 2021 December 31, 2020 Gross Carrying Amount Accumulated Amortization Gross Carrying Amount Accumulated Amortization Intangible assets subject to amortization: Trademarks $ 1,363,112 $ (131,674) $ 1,211,086 $ (104,939) Customer-related 288,582 (60,325) 204,101 (49,616) Patents 8,626 (8,626) 8,556 (8,542) Total 1,660,320 (200,625) 1,423,743 (163,097) Intangible assets not subject to amortization: Trademarks 34,411 34,568 Total other intangible assets $ 1,494,106 $ 1,295,214 |
SHORT AND LONG-TERM DEBT (Table
SHORT AND LONG-TERM DEBT (Tables) | 9 Months Ended |
Oct. 03, 2021 | |
Debt Disclosure [Abstract] | |
Schedule of Short-term Debt | Short-term debt consisted of the following: October 3, 2021 December 31, 2020 Short-term foreign bank borrowings against lines of credit $ 65,398 $ 74,041 U.S. commercial paper 344,976 — Total short-term debt $ 410,374 $ 74,041 Weighted average interest rate on outstanding commercial paper 0.1 % N/A |
Schedule of Long-term Debt Instruments | Long-term debt consisted of the following: Debt Type and Rate Maturity Date October 3, 2021 December 31, 2020 8.800% Debentures (1) February 15, 2021 $ — $ 84,715 3.100% Notes (2) May 15, 2021 — 350,000 2.625% Notes May 1, 2023 250,000 250,000 3.375% Notes May 15, 2023 500,000 500,000 2.050% Notes November 15, 2024 300,000 300,000 0.900% Notes June 1, 2025 300,000 300,000 3.200% Notes August 21, 2025 300,000 300,000 2.300% Notes August 15, 2026 500,000 500,000 7.200% Debentures August 15, 2027 193,639 193,639 2.450% Notes November 15, 2029 300,000 300,000 1.700% Notes June 1, 2030 350,000 350,000 3.375% Notes August 15, 2046 300,000 300,000 3.125% Notes November 15, 2049 400,000 400,000 2.650% Notes June 1, 2050 350,000 350,000 Finance lease obligations (see Note 7 ) 78,246 80,755 Net impact of interest rate swaps, debt issuance costs and unamortized debt discounts (23,914) (30,525) Total long-term debt 4,097,971 4,528,584 Less—current portion 2,812 438,829 Long-term portion $ 4,095,159 $ 4,089,755 (1) In February 2021, we repaid $84,715 of 8.800% Debentures due upon their maturity. (2) In May 2021, we repaid $350,000 of 3.100% Notes due upon their maturity. |
Schedule of Net Interest Expense | Net interest expense consists of the following: Three Months Ended Nine Months Ended October 3, 2021 September 27, 2020 October 3, 2021 September 27, 2020 Interest expense $ 33,066 $ 39,720 $ 106,597 $ 119,496 Capitalized interest (2,380) (1,664) (7,181) (4,745) Interest expense 30,686 38,056 99,416 114,751 Interest income (532) (798) (1,761) (3,159) Interest expense, net $ 30,154 $ 37,258 $ 97,655 $ 111,592 |
DERIVATIVE INSTRUMENTS (Tables)
DERIVATIVE INSTRUMENTS (Tables) | 9 Months Ended |
Oct. 03, 2021 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Schedule of the Classification of Derivative Assets and Liabilities within the Consolidated Balance Sheets | The following table presents the classification of derivative assets and liabilities within the Consolidated Balance Sheets as of October 3, 2021 and December 31, 2020: October 3, 2021 December 31, 2020 Assets (1) Liabilities (1) Assets (1) Liabilities (1) Derivatives designated as cash flow hedging instruments: Foreign exchange contracts $ 1,084 $ 1,292 $ 2,388 $ 5,522 Derivatives not designated as hedging instruments: Commodities futures and options (2) 1,924 1,743 3,299 1,648 Deferred compensation derivatives 82 — 3,630 — Foreign exchange contracts 565 — 176 93 2,571 1,743 7,105 1,741 Total $ 3,655 $ 3,035 $ 9,493 $ 7,263 (1) Derivatives assets are classified on our Consolidated Balance Sheets within prepaid expenses and other as well as other non-current assets. Derivative liabilities are classified on our Consolidated Balance Sheets within accrued liabilities and other long-term liabilities. |
Schedule of the Effect of Derivative Instruments on the Consolidated Statements of Income | The effect of derivative instruments on the Consolidated Statements of Income for the three months ended October 3, 2021 and September 27, 2020 was as follows: Non-designated Hedges Cash Flow Hedges Gains (losses) recognized in income (a) Gains (losses) recognized in other comprehensive income (“OCI”) Gains (losses) reclassified from accumulated OCI (“AOCI”) into income (b) 2021 2020 2021 2020 2021 2020 Commodities futures and options $ 33,643 $ 74,279 $ — $ — $ — $ — Foreign exchange contracts 1 1,404 5,779 (807) (2,030) 3 Interest rate swap agreements — — — — (2,679) (2,344) Deferred compensation derivatives 82 2,437 — — — — Total $ 33,726 $ 78,120 $ 5,779 $ (807) $ (4,709) $ (2,341) The effect of derivative instruments on the Consolidated Statements of Income for the nine months ended October 3, 2021 and September 27, 2020 was as follows: Non-designated Hedges Cash Flow Hedges Gains (losses) recognized in income (a) Gains (losses) recognized in OCI Gains (losses) reclassified from AOCI into income (b) 2021 2020 2021 2020 2021 2020 Commodities futures and options $ 64,199 $ (189) $ — $ — $ — $ — Foreign exchange contracts 574 (2,472) (2,200) 5,249 (5,174) 1,393 Interest rate swap agreements — — — — (8,353) (7,031) Deferred compensation derivatives 3,592 1,304 — — — — Total $ 68,365 $ (1,357) $ (2,200) $ 5,249 $ (13,527) $ (5,638) (a) Gains (losses) recognized in income for non-designated commodities futures and options contracts were included in cost of sales. Gains (losses) recognized in income for non-designated foreign currency forward exchange contracts and deferred compensation derivatives were included in selling, marketing and administrative expenses. (b) Gains (losses) reclassified from AOCI into income for foreign currency forward exchange contracts were included in selling, marketing and administrative expenses. Losses reclassified from AOCI into income for interest rate swap agreements were included in interest expense. |
FAIR VALUE MEASUREMENTS (Tables
FAIR VALUE MEASUREMENTS (Tables) | 9 Months Ended |
Oct. 03, 2021 | |
FAIR VALUE MEASUREMENTS [Abstract] | |
Schedule of Assets and Liabilities Measured at Fair Value | The following table presents assets and liabilities that were measured at fair value in the Consolidated Balance Sheets on a recurring basis as of October 3, 2021 and December 31, 2020: Assets (Liabilities) Level 1 Level 2 Level 3 Total October 3, 2021: Derivative Instruments: Assets: Foreign exchange contracts (1) $ — $ 1,649 $ — $ 1,649 Deferred compensation derivatives (2) — 82 — 82 Commodities futures and options (3) 1,924 — — 1,924 Liabilities: Foreign exchange contracts (1) — 1,292 — 1,292 Commodities futures and options (3) 1,743 — — 1,743 December 31, 2020: Assets: Foreign exchange contracts (1) $ — $ 2,564 $ — $ 2,564 Deferred compensation derivatives (2) — 3,630 — 3,630 Commodities futures and options (3) 3,299 — — 3,299 Liabilities: Foreign exchange contracts (1) — 5,615 — 5,615 Commodities futures and options (3) 1,648 — — 1,648 (1) The fair value of foreign currency forward exchange contracts is the difference between the contract and current market foreign currency exchange rates at the end of the period. We estimate the fair value of foreign currency forward exchange contracts on a quarterly basis by obtaining market quotes of spot and forward rates for contracts with similar terms, adjusted where necessary for maturity differences. (2) The fair value of deferred compensation derivatives is based on quoted prices for market interest rates and a broad market equity index. (3) The fair value of commodities futures and options contracts is based on quoted market prices. |
Schedule of Fair Values and Carrying Values of Long-Term Debt | The fair values and carrying values of long-term debt, including the current portion, were as follows: Fair Value Carrying Value October 3, 2021 December 31, 2020 October 3, 2021 December 31, 2020 Current portion of long-term debt $ 2,812 $ 443,215 $ 2,812 $ 438,829 Long-term debt 4,310,889 4,479,499 4,095,159 4,089,755 Total $ 4,313,701 $ 4,922,714 $ 4,097,971 $ 4,528,584 |
Schedule of Impairment Charges | During the nine months ended September 27, 2020, we recorded the following impairment charges, which use significant unobservable inputs, or Level 3 inputs, as defined by the fair value hierarchy: 2020 Adjustment to disposal group (1) $ 6,200 Other asset write-down (2) 2,943 Long-lived asset impairment charges $ 9,143 (1) In connection with the sale of the LSFC joint venture (disposal group previously classified as held for sale), we recorded impairment charges to adjust long-lived asset values. The fair value of the disposal group was supported by potential sales prices with third-party buyers. The sale of the LSFC joint venture was completed in January 2021. (2) In connection with a previous sale, the Company wrote-down certain receivables deemed uncollectible. |
LEASES (Tables)
LEASES (Tables) | 9 Months Ended |
Oct. 03, 2021 | |
Leases [Abstract] | |
Schedule of Components of Lease Expense | The components of lease expense for the three months ended October 3, 2021 and September 27, 2020 were as follows: Three Months Ended Lease expense Classification October 3, 2021 September 27, 2020 Operating lease cost Cost of sales or SM&A (1) $ 10,764 $ 11,485 Finance lease cost: Amortization of ROU assets Depreciation and amortization (1) 1,971 1,959 Interest on lease liabilities Interest expense, net 1,100 1,106 Net lease cost (2) $ 13,835 $ 14,550 The components of lease expense for the nine months ended October 3, 2021 and September 27, 2020 were as follows: Nine Months Ended Lease expense Classification October 3, 2021 September 27, 2020 Operating lease cost Cost of sales or SM&A (1) $ 33,318 $ 32,702 Finance lease cost: Amortization of ROU assets Depreciation and amortization (1) 6,032 5,938 Interest on lease liabilities Interest expense, net 3,321 3,340 Net lease cost (2) $ 42,671 $ 41,980 (1) Supply chain-related amounts were included in cost of sales. (2) Net lease cost does not include short-term leases, variable lease costs or sublease income, all of which are immaterial. Information regarding our lease terms and discount rates were as follows: October 3, 2021 December 31, 2020 Weighted-average remaining lease term (years) Operating leases 13.0 12.5 Finance leases 30.6 30.1 Weighted-average discount rate Operating leases 3.7 % 3.8 % Finance leases 5.9 % 5.9 % |
Schedule of Supplemental Balance Sheet Information | Supplemental balance sheet information related to leases were as follows: Leases Classification October 3, 2021 December 31, 2020 Assets Operating lease ROU assets Other non-current assets $ 196,746 $ 224,268 Finance lease ROU assets, at cost Property, plant and equipment, gross 98,967 101,426 Accumulated amortization Accumulated depreciation (18,097) (13,361) Finance lease ROU assets, net Property, plant and equipment, net 80,870 88,065 Total leased assets $ 277,616 $ 312,333 Liabilities Current Operating Accrued liabilities $ 25,156 $ 36,578 Finance Current portion of long-term debt 3,533 4,868 Non-current Operating Other long-term liabilities 166,827 181,871 Finance Long-term debt 74,713 75,887 Total lease liabilities $ 270,229 $ 299,204 The components of certain Consolidated Balance Sheet accounts are as follows: October 3, 2021 December 31, 2020 Inventories: Raw materials $ 403,374 $ 388,600 Goods in process 131,523 104,841 Finished goods 662,073 645,664 Inventories at First In First Out 1,196,970 1,139,105 Adjustment to Last In First Out (170,429) (174,898) Total inventories $ 1,026,541 $ 964,207 Prepaid expenses and other: Prepaid expenses $ 68,242 $ 95,669 Other current assets 130,418 158,809 Total prepaid expenses and other $ 198,660 $ 254,478 Property, plant and equipment: Land $ 148,283 $ 131,513 Buildings 1,466,156 1,387,106 Machinery and equipment 3,267,233 3,169,754 Construction in progress 254,879 276,514 Property, plant and equipment, gross 5,136,551 4,964,887 Accumulated depreciation (2,766,358) (2,679,632) Property, plant and equipment, net $ 2,370,193 $ 2,285,255 Other non-current assets: Capitalized software, net $ 232,367 $ 187,673 Operating lease ROU assets 196,746 224,268 Investments in unconsolidated affiliates 77,865 52,351 Other non-current assets 121,708 91,595 Total other non-current assets $ 628,686 $ 555,887 Accrued liabilities: Payroll, compensation and benefits $ 237,934 $ 237,342 Advertising, promotion and product allowances 323,903 309,537 Operating lease liabilities 25,156 36,578 Other 164,979 198,309 Total accrued liabilities $ 751,972 $ 781,766 Other long-term liabilities: Post-retirement benefits liabilities $ 214,954 $ 223,507 Pension benefits liabilities 46,183 70,727 Operating lease liabilities 166,827 181,871 Other 211,932 207,329 Total other long-term liabilities $ 639,896 $ 683,434 Accumulated other comprehensive loss: Foreign currency translation adjustments $ (95,941) $ (98,525) Pension and post-retirement benefit plans, net of tax (165,621) (194,205) Cash flow hedges, net of tax (36,838) (45,352) Total accumulated other comprehensive loss $ (298,400) $ (338,082) |
Schedule of Maturity of Operating Lease Liabilities | The maturity of our lease liabilities as of October 3, 2021 were as follows: Operating leases Finance leases Total 2021 (rest of year) $ 9,959 $ 2,165 $ 12,124 2022 28,404 7,352 35,756 2023 20,759 5,255 26,014 2024 15,737 4,687 20,424 2025 14,210 4,720 18,930 Thereafter 160,556 161,336 321,892 Total lease payments 249,625 185,515 435,140 Less: Imputed interest 57,642 107,269 164,911 Total lease liabilities $ 191,983 $ 78,246 $ 270,229 |
Schedule of Maturity of Finance Lease Liabilities | The maturity of our lease liabilities as of October 3, 2021 were as follows: Operating leases Finance leases Total 2021 (rest of year) $ 9,959 $ 2,165 $ 12,124 2022 28,404 7,352 35,756 2023 20,759 5,255 26,014 2024 15,737 4,687 20,424 2025 14,210 4,720 18,930 Thereafter 160,556 161,336 321,892 Total lease payments 249,625 185,515 435,140 Less: Imputed interest 57,642 107,269 164,911 Total lease liabilities $ 191,983 $ 78,246 $ 270,229 |
Schedule of Supplemental Cash Flow Information Related To Leases | Supplemental cash flow and other information related to leases were as follows: Nine Months Ended October 3, 2021 September 27, 2020 Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows from operating leases $ 32,243 $ 32,010 Operating cash flows from finance leases 3,321 3,341 Financing cash flows from finance leases 3,313 3,136 ROU assets obtained in exchange for lease liabilities: Operating leases $ 7,013 $ 36,629 Finance leases 436 2,076 |
BUSINESS REALIGNMENT ACTIVITI_2
BUSINESS REALIGNMENT ACTIVITIES (Tables) | 9 Months Ended |
Oct. 03, 2021 | |
Restructuring and Related Activities [Abstract] | |
Schedule of Business Realignment Activity | Costs associated with business realignment activities are classified in our Consolidated Statements of Income as follows: Three Months Ended Nine Months Ended October 3, 2021 September 27, 2020 October 3, 2021 September 27, 2020 Cost of sales $ 213 $ — $ 5,250 $ — Selling, marketing and administrative expense 2,819 — 5,795 2,645 Business realignment costs (benefits) 365 — 2,748 (475) Costs associated with business realignment activities $ 3,397 $ — $ 13,793 $ 2,170 Costs recorded by program during the nine months ended October 3, 2021 and September 27, 2020 related to these activities were as follows: Three Months Ended Nine Months Ended October 3, 2021 September 27, 2020 October 3, 2021 September 27, 2020 International Optimization Program: Severance $ 377 $ — $ 3,199 $ — Other program costs 3,020 — 10,594 — Margin for Growth Program: Severance — — — (653) Other program costs — — — 2,823 Total $ 3,397 $ — $ 13,793 $ 2,170 |
Schedule of Liability Activity for Costs Qualifying as Exit and Disposal Costs | The following table presents the liability activity for costs qualifying as exit and disposal costs for the nine months ended October 3, 2021: Total Liability balance at December 31, 2020 (1) $ 12,748 2021 business realignment charges (2) 6,828 Cash payments (18,767) Liability balance at October 3, 2021 (1) $ 809 (1) The liability balances reflected above are reported within accrued liabilities and other long-term liabilities. |
PENSION AND OTHER POST-RETIRE_2
PENSION AND OTHER POST-RETIREMENT BENEFIT PLANS (Tables) | 9 Months Ended |
Oct. 03, 2021 | |
Retirement Benefits [Abstract] | |
Schedule of Components of Net Periodic Benefit Cost | The components of net periodic benefit cost for the three months ended October 3, 2021 and September 27, 2020 were as follows: Pension Benefits Other Benefits Three Months Ended Three Months Ended October 3, 2021 September 27, 2020 October 3, 2021 September 27, 2020 Service cost $ 5,256 $ 5,431 $ 45 $ 39 Interest cost 4,785 6,125 964 1,508 Expected return on plan assets (12,249) (13,243) — — Amortization of prior service (credit) cost (1,536) (1,823) — 75 Amortization of net loss (gain) 4,585 7,026 — (10) Settlement loss 5,408 1,282 — — Total net periodic benefit cost $ 6,249 $ 4,798 $ 1,009 $ 1,612 The components of net periodic benefit cost for the nine months ended October 3, 2021 and September 27, 2020 were as follows: Pension Benefits Other Benefits Nine Months Ended Nine Months Ended October 3, 2021 September 27, 2020 October 3, 2021 September 27, 2020 Service cost $ 16,178 $ 16,274 $ 135 $ 119 Interest cost 13,511 20,081 2,893 4,520 Expected return on plan assets (36,861) (39,553) — — Amortization of prior service (credit) cost (4,607) (5,474) — 225 Amortization of net loss (gain) 16,005 20,190 — (29) Settlement loss 12,848 4,935 — — Total net periodic benefit cost $ 17,074 $ 16,453 $ 3,028 $ 4,835 |
STOCK COMPENSATION PLANS (Table
STOCK COMPENSATION PLANS (Tables) | 9 Months Ended |
Oct. 03, 2021 | |
Share-based Payment Arrangement [Abstract] | |
Schedule of Stock Compensation Costs | For the periods presented, compensation expense for all types of stock-based compensation programs and the related income tax benefit recognized were as follows: Three Months Ended Nine Months Ended October 3, 2021 September 27, 2020 October 3, 2021 September 27, 2020 Pre-tax compensation expense $ 18,527 $ 12,407 $ 51,009 $ 37,897 Related income tax benefit 2,791 2,723 10,814 7,617 |
Schedule of Activity Relating to the Grants of Stock Options | A summary of activity relating to grants of stock options for the period ended October 3, 2021 is as follows: Stock Options Shares Weighted-Average Weighted-Average Remaining Aggregate Intrinsic Value Outstanding at beginning of the period 1,839,811 $99.72 4.8 years Granted 32,155 $147.98 Exercised (420,520) $96.03 Forfeited (3,009) $102.58 Outstanding as of October 3, 2021 1,448,437 $101.85 4.5 years $ 99,836 Options exercisable as of October 3, 2021 1,264,140 $100.37 4.2 years $ 89,006 |
Schedule of Fair Value Estimated on the Grant Date and the Weighted Average Assumptions | The fair value was estimated on the date of grant using a Black-Scholes option-pricing model and the following weighted-average assumptions: Nine Months Ended October 3, 2021 September 27, 2020 Dividend yields 2.2 % 2.1 % Expected volatility 21.8 % 17.5 % Risk-free interest rates 1.0 % 1.3 % Expected term in years 6.3 6.7 |
Schedule of Activity Relating to Grants of PSUs and RSUs | A summary of activity relating to grants of PSUs and RSUs for the period ended October 3, 2021 is as follows: Performance Stock Units and Restricted Stock Units Number of units Weighted-average grant date fair value for equity awards (per unit) Outstanding at beginning of year 1,053,332 $135.11 Granted 392,419 $153.97 Performance assumption change (1) 215,725 $147.96 Vested (331,454) $116.59 Forfeited (44,899) $148.39 Outstanding as of October 3, 2021 1,285,123 $146.64 (1) Reflects the net number of PSUs above and below target levels based on the performance metrics. |
Schedule of Information Pertaining to Fair Value of PSUs and RSUs Granted for Potential Future Distribution | The following table sets forth information about the fair value of the PSUs and RSUs granted for potential future distribution to employees and non-employee directors. In addition, the table provides assumptions used to determine the fair value of the market-based total shareholder return component using the Monte Carlo simulation model on the date of grant. Nine Months Ended October 3, 2021 September 27, 2020 Units granted 392,419 340,526 Weighted-average fair value at date of grant $ 153.97 $ 162.08 Monte Carlo simulation assumptions: Estimated values $ 66.44 $ 80.08 Dividend yields 2.2 % 2.0 % Expected volatility 26.4 % 17.3 % |
SEGMENT INFORMATION (Tables)
SEGMENT INFORMATION (Tables) | 9 Months Ended |
Oct. 03, 2021 | |
Segment Reporting [Abstract] | |
Schedule of Net Sales and Earnings by Segment | Our segment net sales and earnings were as follows: Three Months Ended Nine Months Ended October 3, 2021 September 27, 2020 October 3, 2021 September 27, 2020 Net sales: North America $ 2,125,627 $ 2,014,152 $ 5,986,692 $ 5,442,760 International and Other 234,212 205,677 658,517 521,715 Total $ 2,359,839 $ 2,219,829 $ 6,645,209 $ 5,964,475 Segment income: North America $ 666,089 $ 647,109 $ 1,893,554 $ 1,726,251 International and Other 38,699 24,477 114,722 36,512 Total segment income 704,788 671,586 2,008,276 1,762,763 Unallocated corporate expense (1) 145,028 131,934 434,070 363,384 Unallocated mark-to-market (gains) losses on commodity derivatives (18,468) (71,758) (24,137) 10,483 Long-lived asset impairment charges (see Note 6 ) — — — 9,143 Costs associated with business realignment activities (see Note 9 ) 3,397 — 13,793 2,170 Operating profit 574,831 611,410 1,584,550 1,377,583 Interest expense, net (see Note 4 ) 30,154 37,258 97,655 111,592 Other (income) expense, net (see Note 18 ) 23,004 11,644 32,612 34,394 Income before income taxes $ 521,673 $ 562,508 $ 1,454,283 $ 1,231,597 (1) Includes centrally-managed (a) corporate functional costs relating to legal, treasury, finance, and human resources, (b) expenses associated with the oversight and administration of our global operations, including warehousing, distribution and manufacturing, information systems and global shared services, (c) non-cash stock-based compensation expense, (d) acquisition-related costs, and (e) other gains or losses that are not integral to segment performance. |
Schedule of Unallocated Mark-to-Market (Gains) Losses on Commodity Derivatives | Activity within the unallocated mark-to-market adjustment for commodity derivatives is as follows: Three Months Ended Nine Months Ended October 3, 2021 September 27, 2020 October 3, 2021 September 27, 2020 Net (gains) losses on mark-to-market valuation of commodity derivative positions recognized in income $ (33,643) $ (74,279) $ (64,199) $ 189 Net gains on commodity derivative positions reclassified from unallocated to segment income 15,175 2,521 40,062 10,294 Net (gains) losses on mark-to-market valuation of commodity derivative positions recognized in unallocated derivative (gains) losses $ (18,468) $ (71,758) $ (24,137) $ 10,483 |
Schedule of Depreciation and Amortization Expense Included within Segment Income | Depreciation and amortization expense included within segment income presented above is as follows: Three Months Ended Nine Months Ended October 3, 2021 September 27, 2020 October 3, 2021 September 27, 2020 North America $ 59,216 $ 56,518 $ 175,238 $ 164,599 International and Other 6,439 6,956 20,187 21,202 Corporate 12,368 11,691 36,528 31,888 Total $ 78,023 $ 75,165 $ 231,953 $ 217,689 |
Schedule of Segment Information by Geography | Additional information regarding our net sales disaggregated by geographical region is as follows: Three Months Ended Nine Months Ended October 3, 2021 September 27, 2020 October 3, 2021 September 27, 2020 Net sales: United States $ 2,017,378 $ 1,914,316 $ 5,681,498 $ 5,185,858 All other countries 342,461 305,513 963,711 778,617 Total $ 2,359,839 $ 2,219,829 $ 6,645,209 $ 5,964,475 |
Schedule of Additional Product Line Sales | The majority of our products are confectionery or confectionery-based and include chocolate and non-chocolate confectionery products, gum and mint refreshment products, spreads, snack bites and mixes, as well as pantry items such as baking ingredients, toppings and sundae syrups. Our snacks portfolio includes ready-to-eat popcorn, baked and trans fat free snacks, protein bars and other better-for-you snacks. Additional information regarding our net sales disaggregated by product line is as follows: Three Months Ended Nine Months Ended October 3, 2021 September 27, 2020 October 3, 2021 September 27, 2020 Net sales: Confectionery and confectionery-based portfolio $ 2,190,223 $ 2,078,582 $ 6,183,741 $ 5,578,997 Snacks portfolio 169,616 141,247 461,468 385,478 Total $ 2,359,839 $ 2,219,829 $ 6,645,209 $ 5,964,475 |
TREASURY STOCK ACTIVITY TREAS_2
TREASURY STOCK ACTIVITY TREASURY STOCK ACTIVITY (Tables) | 9 Months Ended |
Oct. 03, 2021 | |
Equity [Abstract] | |
Schedule of Treasury Stock Activity | A summary of our treasury stock activity is as follows: Nine Months Ended October 3, 2021 Shares Dollars In thousands Shares repurchased in the open market under pre-approved share repurchase programs 871,144 $ 150,017 Shares repurchased to replace Treasury Stock issued for stock options and incentive compensation 2,005,500 $ 307,929 Total share repurchases 2,876,644 457,946 Shares issued for stock options and incentive compensation (637,580) (26,529) Net change 2,239,064 $ 431,417 |
NONCONTROLLING INTEREST (Tables
NONCONTROLLING INTEREST (Tables) | 9 Months Ended |
Oct. 03, 2021 | |
Equity [Abstract] | |
Schedule of Activity Relating to the Noncontrolling Interest | A roll-forward showing the 2021 activity relating to the noncontrolling interest follows: Noncontrolling Interest Balance, December 31, 2020 $ 3,531 Net gain attributable to noncontrolling interest 1,072 Divestiture of noncontrolling interest (1,013) Other comprehensive income - foreign currency translation adjustments 5,249 Balance, October 3, 2021 $ 8,839 |
EARNINGS PER SHARE (Tables)
EARNINGS PER SHARE (Tables) | 9 Months Ended |
Oct. 03, 2021 | |
Earnings Per Share [Abstract] | |
Schedule of Basic and Diluted Earnings Per Share | Three Months Ended October 3, 2021 September 27, 2020 Common Stock Class B Common Stock Common Stock Class B Common Stock Basic earnings per share: Numerator: Allocation of distributed earnings (cash dividends paid) $ 131,247 $ 49,643 $ 119,431 $ 44,308 Allocation of undistributed earnings 191,575 72,462 206,491 77,053 Total earnings—basic $ 322,822 $ 122,105 $ 325,922 $ 121,361 Denominator (shares in thousands): Total weighted-average shares—basic 145,665 60,614 147,688 60,614 Earnings Per Share—basic $ 2.22 $ 2.01 $ 2.21 $ 2.00 Diluted earnings per share: Numerator: Allocation of total earnings used in basic computation $ 322,822 $ 122,105 $ 325,922 $ 121,361 Reallocation of total earnings as a result of conversion of Class B common stock to Common stock 122,105 — 121,361 — Reallocation of undistributed earnings — (369) — (317) Total earnings—diluted $ 444,927 $ 121,736 $ 447,283 $ 121,044 Denominator (shares in thousands): Number of shares used in basic computation 145,665 60,614 147,688 60,614 Weighted-average effect of dilutive securities: Conversion of Class B common stock to Common shares outstanding 60,614 — 60,614 — Employee stock options 625 — 557 — Performance and restricted stock units 522 — 281 — Total weighted-average shares—diluted 207,426 60,614 209,140 60,614 Earnings Per Share—diluted $ 2.14 $ 2.01 $ 2.14 $ 2.00 Nine Months Ended October 3, 2021 September 27, 2020 Common Stock Class B Common Stock Common Stock Class B Common Stock Basic earnings per share: Numerator: Allocation of distributed earnings (cash dividends paid) $ 366,934 $ 138,260 $ 348,608 $ 129,410 Allocation of undistributed earnings 462,505 174,257 371,084 138,219 Total earnings—basic $ 829,439 $ 312,517 $ 719,692 $ 267,629 Denominator (shares in thousands): Total weighted-average shares—basic 146,259 60,614 147,845 60,614 Earnings Per Share—basic $ 5.67 $ 5.16 $ 4.87 $ 4.42 Diluted earnings per share: Numerator: Allocation of total earnings used in basic computation $ 829,439 $ 312,517 $ 719,692 $ 267,629 Reallocation of total earnings as a result of conversion of Class B common stock to Common stock 312,517 — 267,629 — Reallocation of undistributed earnings — (847) — (654) Total earnings—diluted $ 1,141,956 $ 311,670 $ 987,321 $ 266,975 Denominator (shares in thousands): Number of shares used in basic computation 146,259 60,614 147,845 60,614 Weighted-average effect of dilutive securities: Conversion of Class B common stock to Common shares outstanding 60,614 — 60,614 — Employee stock options 613 — 599 — Performance and restricted stock units 371 — 366 — Total weighted-average shares—diluted 207,857 60,614 209,424 60,614 Earnings Per Share—diluted $ 5.49 $ 5.14 $ 4.71 $ 4.40 |
OTHER (INCOME) EXPENSE, NET O_2
OTHER (INCOME) EXPENSE, NET OTHER (INCOME) EXPENSE, NET (Tables) | 9 Months Ended |
Oct. 03, 2021 | |
Other Income and Expenses [Abstract] | |
Schedule of Other (Income) Expense, Net | A summary of the components of other (income) expense, net is as follows: Three Months Ended Nine Months Ended October 3, 2021 September 27, 2020 October 3, 2021 September 27, 2020 Write-down of equity investments in partnerships qualifying for historic and renewable energy tax credits (see Note 8 ) $ 20,963 $ 10,707 $ 28,734 $ 29,257 Non-service cost components of net periodic benefit cost relating to pension and other post-retirement benefit plans (see Note 11 ) 1,952 940 3,772 4,895 Other (income) expense, net 89 (3) 106 242 Total $ 23,004 $ 11,644 $ 32,612 $ 34,394 |
SUPPLEMENTAL BALANCE SHEET IN_2
SUPPLEMENTAL BALANCE SHEET INFORMATION (Tables) | 9 Months Ended |
Oct. 03, 2021 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Schedule of Supplemental Balance Sheet Information | Supplemental balance sheet information related to leases were as follows: Leases Classification October 3, 2021 December 31, 2020 Assets Operating lease ROU assets Other non-current assets $ 196,746 $ 224,268 Finance lease ROU assets, at cost Property, plant and equipment, gross 98,967 101,426 Accumulated amortization Accumulated depreciation (18,097) (13,361) Finance lease ROU assets, net Property, plant and equipment, net 80,870 88,065 Total leased assets $ 277,616 $ 312,333 Liabilities Current Operating Accrued liabilities $ 25,156 $ 36,578 Finance Current portion of long-term debt 3,533 4,868 Non-current Operating Other long-term liabilities 166,827 181,871 Finance Long-term debt 74,713 75,887 Total lease liabilities $ 270,229 $ 299,204 The components of certain Consolidated Balance Sheet accounts are as follows: October 3, 2021 December 31, 2020 Inventories: Raw materials $ 403,374 $ 388,600 Goods in process 131,523 104,841 Finished goods 662,073 645,664 Inventories at First In First Out 1,196,970 1,139,105 Adjustment to Last In First Out (170,429) (174,898) Total inventories $ 1,026,541 $ 964,207 Prepaid expenses and other: Prepaid expenses $ 68,242 $ 95,669 Other current assets 130,418 158,809 Total prepaid expenses and other $ 198,660 $ 254,478 Property, plant and equipment: Land $ 148,283 $ 131,513 Buildings 1,466,156 1,387,106 Machinery and equipment 3,267,233 3,169,754 Construction in progress 254,879 276,514 Property, plant and equipment, gross 5,136,551 4,964,887 Accumulated depreciation (2,766,358) (2,679,632) Property, plant and equipment, net $ 2,370,193 $ 2,285,255 Other non-current assets: Capitalized software, net $ 232,367 $ 187,673 Operating lease ROU assets 196,746 224,268 Investments in unconsolidated affiliates 77,865 52,351 Other non-current assets 121,708 91,595 Total other non-current assets $ 628,686 $ 555,887 Accrued liabilities: Payroll, compensation and benefits $ 237,934 $ 237,342 Advertising, promotion and product allowances 323,903 309,537 Operating lease liabilities 25,156 36,578 Other 164,979 198,309 Total accrued liabilities $ 751,972 $ 781,766 Other long-term liabilities: Post-retirement benefits liabilities $ 214,954 $ 223,507 Pension benefits liabilities 46,183 70,727 Operating lease liabilities 166,827 181,871 Other 211,932 207,329 Total other long-term liabilities $ 639,896 $ 683,434 Accumulated other comprehensive loss: Foreign currency translation adjustments $ (95,941) $ (98,525) Pension and post-retirement benefit plans, net of tax (165,621) (194,205) Cash flow hedges, net of tax (36,838) (45,352) Total accumulated other comprehensive loss $ (298,400) $ (338,082) |
BUSINESS ACQUISITION AND DIVE_3
BUSINESS ACQUISITION AND DIVESTITURES - NARRATIVE (Details) - Lily's Sweets, LLC $ in Thousands | 3 Months Ended |
Oct. 03, 2021USD ($) | |
Business Acquisition [Line Items] | |
Business combination, consideration transferred | $ 422,210 |
Business combination, contingent consideration, liability | 5,000 |
Finite-lived trademarks, gross | 151,600 |
Finite-lived customer relationships, gross | $ 84,200 |
Trademarks | |
Business Acquisition [Line Items] | |
Finite-lived intangible asset, useful life | 33 years |
Customer Relationships | Minimum | |
Business Acquisition [Line Items] | |
Finite-lived intangible asset, useful life | 17 years |
Customer Relationships | Maximum | |
Business Acquisition [Line Items] | |
Finite-lived intangible asset, useful life | 18 years |
BUSINESS ACQUISITION AND DIVE_4
BUSINESS ACQUISITION AND DIVESTITURES - PURCHASE CONSIDERATION (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Oct. 03, 2021 | Oct. 03, 2021 | Jul. 04, 2021 | Dec. 31, 2020 | |
Business Acquisition [Line Items] | ||||
Goodwill | $ 2,164,580 | $ 2,164,580 | $ 1,988,215 | |
Goodwill | 1,310 | |||
Lily's Sweets, LLC | ||||
Business Acquisition [Line Items] | ||||
Goodwill | 175,826 | 175,826 | $ 174,516 | |
Other intangible assets | 235,800 | 235,800 | 235,800 | |
Other assets acquired, primarily current assets | 33,092 | 33,092 | 30,383 | |
Other liabilities assumed, primarily current liabilities | (9,620) | (9,620) | (9,620) | |
Deferred income taxes | (7,888) | (7,888) | (7,888) | |
Net assets acquired | 427,210 | $ 427,210 | $ 423,191 | |
Goodwill | 1,310 | |||
Other intangible assets | 0 | |||
Other assets acquired, primarily current assets | 2,709 | |||
Other liabilities assumed, primarily current liabilities | 0 | |||
Deferred income taxes | 0 | |||
Net assets acquired | $ 4,019 |
GOODWILL AND INTANGIBLE ASSET_2
GOODWILL AND INTANGIBLE ASSETS - SCHEDULE OF CHANGES IN CARRYING VALUE OF GOODWILL BY REPORTABLE SEGMENT (Details) $ in Thousands | 9 Months Ended |
Oct. 03, 2021USD ($) | |
Goodwill [Roll Forward] | |
Goodwill, beginning balance | $ 1,988,215 |
Goodwill, Acquired During Period | 174,516 |
Goodwill | 1,310 |
Foreign currency translation | 539 |
Goodwill, ending balance | 2,164,580 |
Operating Segments | North America | |
Goodwill [Roll Forward] | |
Goodwill, beginning balance | 1,970,445 |
Goodwill, Acquired During Period | 174,516 |
Goodwill | 1,310 |
Foreign currency translation | 937 |
Goodwill, ending balance | 2,147,208 |
Operating Segments | International and Other | |
Goodwill [Roll Forward] | |
Goodwill, beginning balance | 17,770 |
Goodwill, Acquired During Period | 0 |
Goodwill | 0 |
Foreign currency translation | (398) |
Goodwill, ending balance | $ 17,372 |
GOODWILL AND INTANGIBLE ASSET_3
GOODWILL AND INTANGIBLE ASSETS - SCHEDULE OF GROSS CARRYING AMOUNT AND ACCUMULATED AMORTIZATION FOR EACH MAJOR CLASS OF INTANGIBLE ASSET (Details) - USD ($) $ in Thousands | Oct. 03, 2021 | Dec. 31, 2020 |
Finite-Lived Intangible Assets [Line Items] | ||
Finite-lived intangible assets, gross | $ 1,660,320 | $ 1,423,743 |
Finite-lived intangible assets, accumulated amortization | (200,625) | (163,097) |
Total other intangible assets | 1,494,106 | 1,295,214 |
Trademarks | ||
Finite-Lived Intangible Assets [Line Items] | ||
Indefinite-lived intangible assets, excluding goodwill | 34,411 | 34,568 |
Trademarks | ||
Finite-Lived Intangible Assets [Line Items] | ||
Finite-lived intangible assets, gross | 1,363,112 | 1,211,086 |
Finite-lived intangible assets, accumulated amortization | (131,674) | (104,939) |
Customer-related | ||
Finite-Lived Intangible Assets [Line Items] | ||
Finite-lived intangible assets, gross | 288,582 | 204,101 |
Finite-lived intangible assets, accumulated amortization | (60,325) | (49,616) |
Patents | ||
Finite-Lived Intangible Assets [Line Items] | ||
Finite-lived intangible assets, gross | 8,626 | 8,556 |
Finite-lived intangible assets, accumulated amortization | $ (8,626) | $ (8,542) |
GOODWILL AND INTANGIBLE ASSET_4
GOODWILL AND INTANGIBLE ASSETS - NARRATIVE (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Oct. 03, 2021 | Sep. 27, 2020 | Oct. 03, 2021 | Sep. 27, 2020 | |
Goodwill and Intangible Assets Disclosure [Abstract] | ||||
Amortization of Intangible Assets | $ 13,936 | $ 11,618 | $ 37,192 | $ 34,838 |
SHORT AND LONG-TERM DEBT - SHOR
SHORT AND LONG-TERM DEBT - SHORT-TERM DEBT NARRATIVE (Details) - USD ($) $ in Thousands | Oct. 03, 2021 | Dec. 31, 2020 |
Line of Credit Facility [Line Items] | ||
Short-term debt | $ 410,374 | $ 74,041 |
Commercial Paper | ||
Line of Credit Facility [Line Items] | ||
Short-term debt | $ 344,976 | 0 |
Short-term Debt, Weighted Average Interest Rate, at Point in Time | 0.10% | |
Revolving Credit Facility | Foreign Line of Credit [Member] | ||
Line of Credit Facility [Line Items] | ||
Short-term foreign bank loans against the lines of credit | $ 65,398 | $ 74,041 |
Line of Credit | Revolving Credit Facility | Line of Credit | ||
Line of Credit Facility [Line Items] | ||
Line of Credit Facility, Maximum Borrowing Capacity | 1,500,000 | |
Line Of Credit Facility, Accordion Feature Increase Limit | $ 500,000 |
SHORT AND LONG-TERM DEBT - SCHE
SHORT AND LONG-TERM DEBT - SCHEDULE OF LONG-TERM DEBT INSTRUMENTS (Details) - USD ($) $ in Thousands | 9 Months Ended | |
Oct. 03, 2021 | Dec. 31, 2020 | |
Debt Instrument [Line Items] | ||
Total finance lease liabilities | $ 78,246 | $ 80,755 |
Net impact of interest rate swaps, debt issuance costs and unamortized debt discounts | (23,914) | (30,525) |
Total long-term debt | 4,097,971 | 4,528,584 |
Less—current portion | 2,812 | 438,829 |
Long-term portion | 4,095,159 | 4,089,755 |
Corporate Debt Securities | 8.800% Debentures (1) | ||
Debt Instrument [Line Items] | ||
Total long-term debt | 0 | $ 84,715 |
Repayments of Debt | $ 84,715 | |
Interest rate, stated percentage | 8.80% | 8.80% |
Corporate Debt Securities | 3.100% Notes (2) | ||
Debt Instrument [Line Items] | ||
Total long-term debt | $ 0 | $ 350,000 |
Repayments of Debt | $ 350,000 | |
Interest rate, stated percentage | 3.10% | 3.10% |
Corporate Debt Securities | 2.625% Notes | ||
Debt Instrument [Line Items] | ||
Total long-term debt | $ 250,000 | $ 250,000 |
Interest rate, stated percentage | 2.625% | 2.625% |
Corporate Debt Securities | 3.375% Notes | ||
Debt Instrument [Line Items] | ||
Total long-term debt | $ 500,000 | $ 500,000 |
Interest rate, stated percentage | 3.375% | 3.375% |
Corporate Debt Securities | 2.050% Notes | ||
Debt Instrument [Line Items] | ||
Total long-term debt | $ 300,000 | $ 300,000 |
Interest rate, stated percentage | 2.05% | 2.05% |
Corporate Debt Securities | 0.900% Notes | ||
Debt Instrument [Line Items] | ||
Total long-term debt | $ 300,000 | $ 300,000 |
Interest rate, stated percentage | 0.90% | 0.90% |
Corporate Debt Securities | 3.200% Notes | ||
Debt Instrument [Line Items] | ||
Total long-term debt | $ 300,000 | $ 300,000 |
Interest rate, stated percentage | 3.20% | 3.20% |
Corporate Debt Securities | 2.300% Notes | ||
Debt Instrument [Line Items] | ||
Total long-term debt | $ 500,000 | $ 500,000 |
Interest rate, stated percentage | 2.30% | 2.30% |
Corporate Debt Securities | 7.200% Debentures | ||
Debt Instrument [Line Items] | ||
Total long-term debt | $ 193,639 | $ 193,639 |
Interest rate, stated percentage | 7.20% | 7.20% |
Corporate Debt Securities | 2.450% Notes | ||
Debt Instrument [Line Items] | ||
Total long-term debt | $ 300,000 | $ 300,000 |
Interest rate, stated percentage | 2.45% | 2.45% |
Corporate Debt Securities | 1.700% Notes | ||
Debt Instrument [Line Items] | ||
Total long-term debt | $ 350,000 | $ 350,000 |
Interest rate, stated percentage | 1.70% | 1.70% |
Corporate Debt Securities | 3.375% Notes | ||
Debt Instrument [Line Items] | ||
Total long-term debt | $ 300,000 | $ 300,000 |
Interest rate, stated percentage | 3.375% | 3.375% |
Corporate Debt Securities | 3.125% Notes | ||
Debt Instrument [Line Items] | ||
Total long-term debt | $ 400,000 | $ 400,000 |
Interest rate, stated percentage | 3.125% | 3.125% |
Corporate Debt Securities | 2.650% Notes | ||
Debt Instrument [Line Items] | ||
Total long-term debt | $ 350,000 | $ 350,000 |
Interest rate, stated percentage | 2.65% | 2.65% |
SHORT AND LONG-TERM DEBT - LONG
SHORT AND LONG-TERM DEBT - LONG TERM DEBT INTEREST RATES (Details) - Corporate Debt Securities | Oct. 03, 2021 | Dec. 31, 2020 |
8.800% Debentures (1) | ||
Debt Instrument [Line Items] | ||
Interest rate, stated percentage | 8.80% | 8.80% |
3.100% Notes (2) | ||
Debt Instrument [Line Items] | ||
Interest rate, stated percentage | 3.10% | 3.10% |
2.625% Notes | ||
Debt Instrument [Line Items] | ||
Interest rate, stated percentage | 2.625% | 2.625% |
3.375% Notes | ||
Debt Instrument [Line Items] | ||
Interest rate, stated percentage | 3.375% | 3.375% |
2.050% Notes | ||
Debt Instrument [Line Items] | ||
Interest rate, stated percentage | 2.05% | 2.05% |
0.900% Notes | ||
Debt Instrument [Line Items] | ||
Interest rate, stated percentage | 0.90% | 0.90% |
3.200% Notes | ||
Debt Instrument [Line Items] | ||
Interest rate, stated percentage | 3.20% | 3.20% |
2.300% Notes | ||
Debt Instrument [Line Items] | ||
Interest rate, stated percentage | 2.30% | 2.30% |
7.200% Debentures | ||
Debt Instrument [Line Items] | ||
Interest rate, stated percentage | 7.20% | 7.20% |
2.450% Notes | ||
Debt Instrument [Line Items] | ||
Interest rate, stated percentage | 2.45% | 2.45% |
1.700% Notes | ||
Debt Instrument [Line Items] | ||
Interest rate, stated percentage | 1.70% | 1.70% |
3.375% Notes | ||
Debt Instrument [Line Items] | ||
Interest rate, stated percentage | 3.375% | 3.375% |
3.125% Notes | ||
Debt Instrument [Line Items] | ||
Interest rate, stated percentage | 3.125% | 3.125% |
2.650% Notes | ||
Debt Instrument [Line Items] | ||
Interest rate, stated percentage | 2.65% | 2.65% |
SHORT AND LONG-TERM DEBT - SC_2
SHORT AND LONG-TERM DEBT - SCHEDULE OF NET INTEREST EXPENSE (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Oct. 03, 2021 | Sep. 27, 2020 | Oct. 03, 2021 | Sep. 27, 2020 | |
Debt Disclosure [Abstract] | ||||
Interest expense | $ 33,066 | $ 39,720 | $ 106,597 | $ 119,496 |
Capitalized interest | (2,380) | (1,664) | (7,181) | (4,745) |
Interest expense | 30,686 | 38,056 | 99,416 | 114,751 |
Interest income | (532) | (798) | (1,761) | (3,159) |
Interest expense, net | $ 30,154 | $ 37,258 | $ 97,655 | $ 111,592 |
DERIVATIVE INSTRUMENTS - NARRAT
DERIVATIVE INSTRUMENTS - NARRATIVE (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Oct. 03, 2021 | Sep. 27, 2020 | Oct. 03, 2021 | Sep. 27, 2020 | Dec. 31, 2020 | |
Derivative [Line Items] | |||||
Cash flow hedge gain (loss) to be reclassified within twelve months | $ 11,529 | ||||
Commodities futures and options | Non-designated Hedges | |||||
Derivative [Line Items] | |||||
Derivative, notional amount | $ 383,928 | $ 383,928 | $ 279,843 | ||
Commodities futures and options | Non-designated Hedges | Minimum | |||||
Derivative [Line Items] | |||||
Derivative, term of contract | 3 months | ||||
Commodities futures and options | Non-designated Hedges | Maximum | |||||
Derivative [Line Items] | |||||
Derivative, term of contract | 24 months | ||||
Foreign exchange contracts | |||||
Derivative [Line Items] | |||||
Minimum length of time, hedged in cash flow hedge | 3 months | ||||
Maximum length of time, hedged in cash flow hedge | 12 months | ||||
Foreign exchange contracts | Designated as Hedging Instrument | Cash Flow Hedges | |||||
Derivative [Line Items] | |||||
Derivative, notional amount | 98,949 | $ 98,949 | 130,131 | ||
Foreign exchange contracts | Non-designated Hedges | |||||
Derivative [Line Items] | |||||
Derivative, notional amount | 2,747 | 2,747 | 2,519 | ||
Interest rate swap agreements | Designated as Hedging Instrument | Fair Value Hedging | |||||
Derivative [Line Items] | |||||
Derivative, notional amount | 0 | 0 | 0 | ||
Deferred compensation derivatives | |||||
Derivative [Line Items] | |||||
Derivative, notional amount | 24,866 | $ 24,866 | $ 30,194 | ||
Deferred compensation derivatives | Non-designated Hedges | Minimum | |||||
Derivative [Line Items] | |||||
Derivative, term of contract | 3 months | ||||
Deferred compensation derivatives | Non-designated Hedges | Maximum | |||||
Derivative [Line Items] | |||||
Derivative, term of contract | 12 months | ||||
Interest rate swap | Designated as Hedging Instrument | Fair Value Hedging | Interest Expense | |||||
Derivative [Line Items] | |||||
Fair value hedges, pre-tax benefit (expense) | $ 0 | $ 1,389 | $ 0 | $ 2,148 |
DERIVATIVE INSTRUMENTS - SCHEDU
DERIVATIVE INSTRUMENTS - SCHEDULE OF THE CLASSIFICATION OF DERIVATIVE ASSETS AND LIABILITIES WITHIN THE CONSOLIDATED BALANCE SHEETS (Details) - USD ($) $ in Thousands | Oct. 03, 2021 | Dec. 31, 2020 |
Derivatives, Fair Value [Line Items] | ||
Derivative asset | $ 3,655 | $ 9,493 |
Derivative liability | 3,035 | 7,263 |
Designated as Hedging Instrument | Cash Flow Hedges | Foreign exchange contracts | ||
Derivatives, Fair Value [Line Items] | ||
Derivative asset | 1,084 | 2,388 |
Derivative liability | 1,292 | 5,522 |
Non-designated Hedges | ||
Derivatives, Fair Value [Line Items] | ||
Derivative asset | 2,571 | 7,105 |
Derivative liability | 1,743 | 1,741 |
Non-designated Hedges | Foreign exchange contracts | ||
Derivatives, Fair Value [Line Items] | ||
Derivative asset | 565 | 176 |
Derivative liability | 0 | 93 |
Non-designated Hedges | Commodities futures and options | ||
Derivatives, Fair Value [Line Items] | ||
Derivative asset | 1,924 | 3,299 |
Derivative liability | 1,743 | 1,648 |
Gross derivative assets, included within derivative liabilities | 63,132 | 32,674 |
Derivative liability, gross liabilities | 62,977 | 29,376 |
Non-designated Hedges | Deferred compensation derivatives | ||
Derivatives, Fair Value [Line Items] | ||
Derivative asset | 82 | 3,630 |
Derivative liability | $ 0 | $ 0 |
DERIVATIVE INSTRUMENTS - SCHE_2
DERIVATIVE INSTRUMENTS - SCHEDULE OF THE EFFECT OF DERIVATIVE INSTRUMENTS ON THE CONSOLIDATED STATEMENTS OF INCOME (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Oct. 03, 2021 | Sep. 27, 2020 | Oct. 03, 2021 | Sep. 27, 2020 | |
Derivative [Line Items] | ||||
Derivative Instruments Not Designated as Hedging Instruments, Gain (Loss), Net | $ 33,726 | $ 78,120 | $ 68,365 | $ (1,357) |
Gains (losses) on cash flow hedging derivatives, pre-tax amount | 5,779 | (807) | (2,200) | 5,249 |
Commodities futures and options | ||||
Derivative [Line Items] | ||||
Derivative Instruments Not Designated as Hedging Instruments, Gain (Loss), Net | 33,643 | 74,279 | 64,199 | (189) |
Foreign exchange contracts | ||||
Derivative [Line Items] | ||||
Derivative Instruments Not Designated as Hedging Instruments, Gain (Loss), Net | 1 | 1,404 | 574 | (2,472) |
Interest rate swap agreements | ||||
Derivative [Line Items] | ||||
Derivative Instruments Not Designated as Hedging Instruments, Gain (Loss), Net | 0 | 0 | 0 | 0 |
Deferred compensation derivatives | ||||
Derivative [Line Items] | ||||
Derivative Instruments Not Designated as Hedging Instruments, Gain (Loss), Net | 82 | 2,437 | 3,592 | 1,304 |
Designated as Hedging Instrument | Cash Flow Hedges | ||||
Derivative [Line Items] | ||||
Gains (losses) on cash flow hedging derivatives, pre-tax amount | 5,779 | (807) | (2,200) | 5,249 |
Reclassification from Accumulated Other Comprehensive Income, Current Period, before Tax | (4,709) | (2,341) | (13,527) | (5,638) |
Designated as Hedging Instrument | Cash Flow Hedges | Commodities futures and options | ||||
Derivative [Line Items] | ||||
Gains (losses) on cash flow hedging derivatives, pre-tax amount | 0 | 0 | 0 | 0 |
Reclassification from Accumulated Other Comprehensive Income, Current Period, before Tax | 0 | 0 | 0 | 0 |
Designated as Hedging Instrument | Cash Flow Hedges | Foreign exchange contracts | ||||
Derivative [Line Items] | ||||
Gains (losses) on cash flow hedging derivatives, pre-tax amount | 5,779 | (807) | (2,200) | 5,249 |
Reclassification from Accumulated Other Comprehensive Income, Current Period, before Tax | (2,030) | 3 | (5,174) | 1,393 |
Designated as Hedging Instrument | Cash Flow Hedges | Interest rate swap agreements | ||||
Derivative [Line Items] | ||||
Gains (losses) on cash flow hedging derivatives, pre-tax amount | 0 | 0 | 0 | 0 |
Reclassification from Accumulated Other Comprehensive Income, Current Period, before Tax | (2,679) | (2,344) | (8,353) | (7,031) |
Designated as Hedging Instrument | Cash Flow Hedges | Deferred compensation derivatives | ||||
Derivative [Line Items] | ||||
Gains (losses) on cash flow hedging derivatives, pre-tax amount | 0 | 0 | 0 | 0 |
Reclassification from Accumulated Other Comprehensive Income, Current Period, before Tax | $ 0 | $ 0 | $ 0 | $ 0 |
FAIR VALUE MEASUREMENTS - NARRA
FAIR VALUE MEASUREMENTS - NARRATIVE (Details) - USD ($) | 3 Months Ended | 9 Months Ended | |||
Oct. 03, 2021 | Sep. 27, 2020 | Oct. 03, 2021 | Sep. 27, 2020 | Dec. 31, 2020 | |
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||||
Long-lived asset impairment charges | $ 0 | $ 0 | $ 0 | $ 9,143,000 | |
Significant other unobservable inputs (Level 3) | |||||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||||
Fair value, net asset (liability) | $ 0 | $ 0 | $ 0 |
FAIR VALUE MEASUREMENTS - SCHED
FAIR VALUE MEASUREMENTS - SCHEDULE OF ASSETS AND LIABILITIES MEASURED AT FAIR VALUE (Details) - USD ($) $ in Thousands | Oct. 03, 2021 | Dec. 31, 2020 |
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Derivative asset | $ 3,655 | $ 9,493 |
Derivative liability | 3,035 | 7,263 |
Fair Value, Measurements, Recurring | Foreign exchange contracts | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Derivative asset | 1,649 | 2,564 |
Derivative liability | 1,292 | 5,615 |
Fair Value, Measurements, Recurring | Foreign exchange contracts | Quoted prices in active markets of identical assets (Level 1) | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Derivative asset | 0 | 0 |
Derivative liability | 0 | 0 |
Fair Value, Measurements, Recurring | Foreign exchange contracts | Significant other observable inputs (Level 2) | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Derivative asset | 1,649 | 2,564 |
Derivative liability | 1,292 | 5,615 |
Fair Value, Measurements, Recurring | Foreign exchange contracts | Significant other unobservable inputs (Level 3) | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Derivative asset | 0 | 0 |
Derivative liability | 0 | 0 |
Fair Value, Measurements, Recurring | Deferred compensation derivatives | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Derivative asset | 82 | 3,630 |
Fair Value, Measurements, Recurring | Deferred compensation derivatives | Quoted prices in active markets of identical assets (Level 1) | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Derivative asset | 0 | 0 |
Fair Value, Measurements, Recurring | Deferred compensation derivatives | Significant other observable inputs (Level 2) | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Derivative asset | 82 | 3,630 |
Fair Value, Measurements, Recurring | Deferred compensation derivatives | Significant other unobservable inputs (Level 3) | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Derivative asset | 0 | 0 |
Fair Value, Measurements, Recurring | Commodities futures and options | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Derivative asset | 1,924 | 3,299 |
Derivative liability | 1,743 | 1,648 |
Fair Value, Measurements, Recurring | Commodities futures and options | Quoted prices in active markets of identical assets (Level 1) | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Derivative asset | 1,924 | 3,299 |
Derivative liability | 1,743 | 1,648 |
Fair Value, Measurements, Recurring | Commodities futures and options | Significant other observable inputs (Level 2) | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Derivative asset | 0 | 0 |
Derivative liability | 0 | 0 |
Fair Value, Measurements, Recurring | Commodities futures and options | Significant other unobservable inputs (Level 3) | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Derivative asset | 0 | 0 |
Derivative liability | $ 0 | $ 0 |
FAIR VALUE MEASUREMENTS - SCH_2
FAIR VALUE MEASUREMENTS - SCHEDULE OF FAIR VALUES AND CARRYING VALUES OF LONG-TERM DEBT (Details) - USD ($) $ in Thousands | Oct. 03, 2021 | Dec. 31, 2020 |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Current portion of long-term debt | $ 2,812 | $ 438,829 |
Long-term portion | 4,095,159 | 4,089,755 |
Total long-term debt, carrying value | 4,097,971 | 4,528,584 |
Significant other observable inputs (Level 2) | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Current portion of long-term debt, fair value | 2,812 | 443,215 |
Long-term debt, fair value | 4,310,889 | 4,479,499 |
Total long-term debt, fair value | 4,313,701 | 4,922,714 |
Current portion of long-term debt | 2,812 | 438,829 |
Long-term portion | 4,095,159 | 4,089,755 |
Total long-term debt, carrying value | $ 4,097,971 | $ 4,528,584 |
FAIR VALUE MEASUREMENTS - SCH_3
FAIR VALUE MEASUREMENTS - SCHEDULE OF IMPAIRMENT CHARGES (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Oct. 03, 2021 | Sep. 27, 2020 | Oct. 03, 2021 | Sep. 27, 2020 | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Adjustment to disposal group | $ 6,200 | |||
Long-lived asset impairment charges | $ 0 | $ 0 | $ 0 | 9,143 |
Other Assets | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Long-lived asset impairment charges | $ 2,943 |
LEASES - SCHEDULE OF COMPONENET
LEASES - SCHEDULE OF COMPONENETS OF LEASE EXPENSE (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Oct. 03, 2021 | Sep. 27, 2020 | Oct. 03, 2021 | Sep. 27, 2020 | |
Leases [Abstract] | ||||
Operating lease cost | $ 10,764 | $ 11,485 | $ 33,318 | $ 32,702 |
Amortization of ROU assets, Finance lease cost | 1,971 | 1,959 | 6,032 | 5,938 |
Interest on lease liabilities, Finance lease cost | 1,100 | 1,106 | 3,321 | 3,340 |
Net lease cost (2) | $ 13,835 | $ 14,550 | $ 42,671 | $ 41,980 |
LEASES - SCHEDULE OF INFORMATIO
LEASES - SCHEDULE OF INFORMATION REGARDING OUR LEASE TERMS AND DISCOUNT RATES (Details) | Oct. 03, 2021 | Dec. 31, 2020 |
Leases [Abstract] | ||
Operating leases, Weighted-average remaining lease term (years) | 13 years | 12 years 6 months |
Finance leases, Weighted-average remaining lease term (years) | 30 years 7 months 6 days | 30 years 1 month 6 days |
Operating leases, Weighted-average remaining discount rate | 3.70% | 3.80% |
Finance leases, Weighted-average remaining discount rate | 5.90% | 5.90% |
LEASES - SUPPLEMENTAL BALANCE S
LEASES - SUPPLEMENTAL BALANCE SHEET INFORMATION RELATED TO LEASES (Details) - USD ($) $ in Thousands | Oct. 03, 2021 | Dec. 31, 2020 |
Lease, Description [Line Items] | ||
Operating lease ROU assets | $ 196,746 | $ 224,268 |
Total leased assets | 277,616 | 312,333 |
Operating lease liabilities | 25,156 | 36,578 |
Finance lease liabilities, curent | 3,533 | 4,868 |
Operating lease liabilities | 166,827 | 181,871 |
Finance lease liabilities, non-current | 74,713 | 75,887 |
Total leased liabilities | 270,229 | 299,204 |
Property, plant and equipment, gross | ||
Lease, Description [Line Items] | ||
Finance lease ROU assets, net | 98,967 | 101,426 |
Accumulated depreciation | ||
Lease, Description [Line Items] | ||
Accumulated amortization | (18,097) | (13,361) |
Property, plant and equipment, net | ||
Lease, Description [Line Items] | ||
Finance lease ROU assets, net | $ 80,870 | $ 88,065 |
LEASES - SCHEDULE OF MATURITIES
LEASES - SCHEDULE OF MATURITIES OF LEASE LIABILITIES (Details) - USD ($) $ in Thousands | Oct. 03, 2021 | Dec. 31, 2020 |
Operating leases | ||
2021 (rest of year) | $ 9,959 | |
2022 | 28,404 | |
2023 | 20,759 | |
2024 | 15,737 | |
2025 | 14,210 | |
Thereafter | 160,556 | |
Total lease payments | 249,625 | |
Less: Imputed interest | 57,642 | |
Total operating lease liabilities | 191,983 | |
Finance leases | ||
2021 (rest of year) | 2,165 | |
2022 | 7,352 | |
2023 | 5,255 | |
2024 | 4,687 | |
2025 | 4,720 | |
Thereafter | 161,336 | |
Total lease payments | 185,515 | |
Less: Imputed interest | 107,269 | |
Total finance lease liabilities | 78,246 | $ 80,755 |
2021 (rest of year) | 12,124 | |
2022 | 35,756 | |
2023 | 26,014 | |
2024 | 20,424 | |
2025 | 18,930 | |
Thereafter | 321,892 | |
Total lease payments | 435,140 | |
Less: Imputed interest | 164,911 | |
Total lease liabilities | $ 270,229 |
LEASES - NARRATIVE (Details)
LEASES - NARRATIVE (Details) $ in Thousands | Oct. 03, 2021USD ($) |
Lease, Description [Line Items] | |
Lessee, operating lease, lease not yet commenced | $ 22,000 |
Maximum | |
Lease, Description [Line Items] | |
Lessee, operating lease, lease not yet commenced, term of contract | 8 years |
LEASES - SCHEDULE OF SUPPLEMENT
LEASES - SCHEDULE OF SUPPLEMENTAL CASH FLOW INFORMATION RELATED TO LEASES (Details) - USD ($) $ in Thousands | 9 Months Ended | |
Oct. 03, 2021 | Sep. 27, 2020 | |
Leases [Abstract] | ||
Operating cash flows from operating leases | $ 32,243 | $ 32,010 |
Operating cash flows from finance leases | 3,321 | 3,341 |
Financing cash flows from finance leases | 3,313 | 3,136 |
Operating leases | 7,013 | 36,629 |
Right-of-Use Asset Obtained in Exchange for Finance Lease Liability | $ 436 | $ 2,076 |
INVESTMENTS IN UNCONSOLIDATED_2
INVESTMENTS IN UNCONSOLIDATED AFFILIATES (Details) - USD ($) $ in Thousands | Oct. 03, 2021 | Dec. 31, 2020 |
Business Acquisition [Line Items] | ||
Investments in unconsolidated affiliates | $ 77,865 | $ 52,351 |
Other non-current assets | ||
Business Acquisition [Line Items] | ||
Investments in unconsolidated affiliates | $ 77,865 | $ 52,351 |
BUSINESS REALIGNMENT ACTIVITI_3
BUSINESS REALIGNMENT ACTIVITIES - SCHEDULE OF BUSINESS REALIGNMENT ACTIVITY (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | 9 Months Ended | ||
Oct. 03, 2021 | Sep. 27, 2020 | Jun. 28, 2020 | Oct. 03, 2021 | Sep. 27, 2020 | |
Restructuring Cost and Reserve [Line Items] | |||||
Business realignment costs | $ 3,397 | $ 0 | $ 13,793 | $ 2,170 | |
Cost of Sales | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Business realignment costs | 213 | 0 | 5,250 | 0 | |
Selling, marketing and administrative expense | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Business realignment costs | 2,819 | 0 | 5,795 | 2,645 | |
Business realignment costs (benefits) | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Business realignment costs | 365 | 0 | 2,748 | (475) | |
International Optimization Program | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Business realignment costs | 3,397 | 13,793 | |||
Margin for Growth Program | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Business realignment costs | $ 2,170 | ||||
Severance | International Optimization Program | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Business realignment costs | 377 | 0 | 3,199 | 0 | |
Severance | Margin for Growth Program | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Business realignment costs | 0 | 0 | 0 | (653) | |
Other program costs | International Optimization Program | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Business realignment costs | 3,020 | 0 | 10,594 | 0 | |
Other program costs | Margin for Growth Program | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Business realignment costs | $ 0 | $ 0 | $ 0 | $ 2,823 |
BUSINESS REALIGNMENT ACTIVITI_4
BUSINESS REALIGNMENT ACTIVITIES - SCHEDULE OF LIABILITY ACTIVITY FOR COSTS QUALIFYING AS EXIT AND DISPOSAL COSTS (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Oct. 03, 2021 | Sep. 27, 2020 | Oct. 03, 2021 | Sep. 27, 2020 | |
Restructuring and Related Activities [Abstract] | ||||
Business realignment costs | $ 3,397 | $ 0 | $ 13,793 | $ 2,170 |
Restructuring Reserve [Roll Forward] | ||||
Liability balance at December 31, 2020 | 12,748 | |||
2021 business realignment charges | 6,828 | |||
Cash payments | (18,767) | |||
Liability balance at October 3, 2021 | $ 809 | $ 809 |
BUSINESS REALIGNMENT ACTIVITI_5
BUSINESS REALIGNMENT ACTIVITIES - NARRATIVE (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | 9 Months Ended | ||
Oct. 03, 2021 | Sep. 27, 2020 | Jun. 28, 2020 | Oct. 03, 2021 | Sep. 27, 2020 | |
Restructuring Cost and Reserve [Line Items] | |||||
Business realignment costs | $ 3,397 | $ 0 | $ 13,793 | $ 2,170 | |
International Optimization Program | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Business realignment costs | 3,397 | 13,793 | |||
Restructuring and Related Cost, Cost Incurred to Date | 43,136 | 43,136 | |||
International Optimization Program | Minimum | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Restructuring and related cost, expected cost | 50,000 | 50,000 | |||
Restructuring and related cost, expected cost, cash portion | 40,000 | 40,000 | |||
International Optimization Program | Maximum | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Restructuring and related cost, expected cost | 75,000 | 75,000 | |||
Restructuring and related cost, expected cost, cash portion | $ 65,000 | $ 65,000 | |||
Margin for Growth Program | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Business realignment costs | $ 2,170 | ||||
Business realignment costs (benefits) | Geographic Concentration Risk | International and Other | Margin for Growth Program | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Concentration Risk, Percentage | 37.00% | ||||
Business realignment costs (benefits) | Geographic Concentration Risk | North America | Margin for Growth Program | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Concentration Risk, Percentage | 63.00% |
INCOME TAXES - NARRATIVE (Detai
INCOME TAXES - NARRATIVE (Details) - USD ($) $ in Thousands | 9 Months Ended | |
Oct. 03, 2021 | Sep. 27, 2020 | |
Income Tax Disclosure [Abstract] | ||
Effective Income Tax Rate Reconciliation, at Federal Statutory Income Tax Rate, Percent | 21.00% | |
Effective Income Tax Rate Reconciliation, Percent | 21.40% | 20.10% |
Significant Change in Unrecognized Tax Benefits is Reasonably Possible, Amount of Unrecorded Benefit | $ 12,619 |
PENSION AND OTHER POST-RETIRE_3
PENSION AND OTHER POST-RETIREMENT BENEFIT PLANS - SCHEDULE OF COMPONENTS OF NET PERIODIC BENEFIT COST (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Oct. 03, 2021 | Sep. 27, 2020 | Oct. 03, 2021 | Sep. 27, 2020 | |
Pension Benefits | ||||
Defined Benefit Plan Disclosure [Line Items] | ||||
Service cost | $ 5,256 | $ 5,431 | $ 16,178 | $ 16,274 |
Interest cost | 4,785 | 6,125 | 13,511 | 20,081 |
Expected return on plan assets | (12,249) | (13,243) | (36,861) | (39,553) |
Amortization of prior service (credit) cost | (1,536) | (1,823) | (4,607) | (5,474) |
Amortization of net loss (gain) | 4,585 | 7,026 | 16,005 | 20,190 |
Settlement loss | 5,408 | 1,282 | 12,848 | 4,935 |
Total net periodic benefit cost | 6,249 | 4,798 | 17,074 | 16,453 |
Other Benefits | ||||
Defined Benefit Plan Disclosure [Line Items] | ||||
Service cost | 45 | 39 | 135 | 119 |
Interest cost | 964 | 1,508 | 2,893 | 4,520 |
Expected return on plan assets | 0 | 0 | 0 | 0 |
Amortization of prior service (credit) cost | 0 | 75 | 0 | 225 |
Amortization of net loss (gain) | 0 | (10) | 0 | (29) |
Settlement loss | 0 | 0 | 0 | 0 |
Total net periodic benefit cost | $ 1,009 | $ 1,612 | $ 3,028 | $ 4,835 |
PENSION AND OTHER POST-RETIRE_4
PENSION AND OTHER POST-RETIREMENT BENEFIT PLANS - NARRATIVE (Details) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Oct. 03, 2021USD ($) | Sep. 27, 2020USD ($) | Oct. 03, 2021USD ($) | Sep. 27, 2020USD ($) | |
Defined Benefit Plan Disclosure [Line Items] | ||||
Defined Benefit Plan, Remeasurement, Basis Spread on Discount Rate (Basis Points) | 0.0039 | |||
Defined Benefit Plan, Assumptions Used Calculating Net Periodic Benefit Cost, Expected Long-term Rate of Return on Plan Assets | 4.80% | |||
Pension Benefits | ||||
Defined Benefit Plan Disclosure [Line Items] | ||||
Employer contributions | $ 25,711 | $ 748 | $ 26,894 | $ 1,753 |
Other Benefits | ||||
Defined Benefit Plan Disclosure [Line Items] | ||||
Employer contributions | $ 3,527 | $ 3,157 | $ 11,682 | $ 10,485 |
STOCK COMPENSATION PLANS - SCHE
STOCK COMPENSATION PLANS - SCHEDULE OF COMPENSATION EXPENSE AND INCOME TAX BENEFITS FOR STOCK-BASED COMPENSATION PROGRAMS (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Oct. 03, 2021 | Sep. 27, 2020 | Oct. 03, 2021 | Sep. 27, 2020 | |
Share-based Payment Arrangement [Abstract] | ||||
Pre-tax compensation expense | $ 18,527 | $ 12,407 | $ 51,009 | $ 37,897 |
Related income tax benefit | $ 2,791 | $ 2,723 | $ 10,814 | $ 7,617 |
STOCK COMPENSATION PLANS - NARR
STOCK COMPENSATION PLANS - NARRATIVE (Details) - USD ($) $ / shares in Units, $ in Thousands | 9 Months Ended | |
Oct. 03, 2021 | Sep. 27, 2020 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Employee service share-based compensation, nonvested awards, compensation cost not yet recognized | $ 93,180 | |
Employee service share-based compensation, nonvested awards, compensation cost not yet recognized, period for recognition | 2 years 1 month 6 days | |
Share-based Compensation Arrangement by Share-based Payment Award, Award Requisite Service Period | 3 years | |
Intrinsic value of share-based liabilities paid, combined with the fair value of shares vested (in millions of dollars) | $ 50,361 | $ 52,181 |
Deferred performance stock units, deferred restricted stock units, and directors' fees and accumulated dividend amounts representing deferred stock units outstanding | 263,594 | |
Employee stock options | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Share-based Compensation Arrangement by Share-based Payment Award, Expiration Period | 10 years | |
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Period | 4 years | |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Grants in Period, Weighted Average Grant Date Fair Value | $ 24.12 | $ 21.31 |
Intrinsic value of options exercised (in millions of dollars) | $ 28,416 | $ 27,394 |
Performance stock units and restricted stock units | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Common stock, conversion basis (shares) | 1 | |
Performance stock units and restricted stock units | Minimum | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Share-based Compensation Arrangement by Share-based Payment Award, Performance Score, Target Amounts | 0.00% | 0.00% |
Performance stock units and restricted stock units | Maximum | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Share-based Compensation Arrangement by Share-based Payment Award, Performance Score, Target Amounts | 250.00% | 250.00% |
STOCK COMPENSATION PLANS - SC_2
STOCK COMPENSATION PLANS - SCHEDULE OF STOCK OPTION ACTIVITY (Details) - USD ($) $ / shares in Units, $ in Thousands | 9 Months Ended | |
Oct. 03, 2021 | Sep. 27, 2020 | |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding [Roll Forward] | ||
Outstanding shares at beginning of year (shares) | 1,839,811 | |
Granted (shares) | 32,155 | |
Exercised (shares) | (420,520) | |
Forfeited (shares) | (3,009) | |
Outstanding as of October 3, 2021 (shares) | 1,448,437 | |
Options exercisable as of October 3, 2021 (shares) | 1,264,140 | |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Weighted Average Exercise Price [Abstract] | ||
Outstanding (USD per share) | $ 99.72 | |
Granted (USD per share) | 147.98 | |
Exercises (USD per share) | 96.03 | |
Forfeited (USD per share) | 102.58 | |
Outstanding (USD per share) | 101.85 | |
Options exercisable (USD per share) | $ 100.37 | |
Options outstanding, weighted-average remaining contractual term | 4 years 6 months | 4 years 9 months 18 days |
Options exercisable, weighted aver remaining contractual term | 4 years 2 months 12 days | |
Aggregate intrinsic value of options outstanding | $ 99,836 | |
Aggregate intrinsic value of options exercisable | $ 89,006 |
STOCK COMPENSATION PLANS - SC_3
STOCK COMPENSATION PLANS - SCHEDULE OF FAIR VALUE WEIGHTED-AVERAGE ASSUMPTIONS (Details) | 9 Months Ended | |
Oct. 03, 2021 | Sep. 27, 2020 | |
Share-based Payment Arrangement [Abstract] | ||
Dividend yields | 2.20% | 2.10% |
Expected volatility | 21.80% | 17.50% |
Risk-free interest rates | 1.00% | 1.30% |
Expected term in years | 6 years 3 months 18 days | 6 years 8 months 12 days |
STOCK COMPENSATION PLANS - SC_4
STOCK COMPENSATION PLANS - SCHEDULE OF PSUs AND RSUs ACTIVITY (Details) - Performance and restricted stock units - $ / shares | 9 Months Ended | |
Oct. 03, 2021 | Sep. 27, 2020 | |
Share-based Compensation Arrangement by Share-based Payment Award, Non-Option Equity Instruments, Outstanding [Roll Forward] | ||
Outstanding at beginning of year (shares) | 1,053,332 | |
Granted (shares) | 392,419 | 340,526 |
Performance assumption change (shares) | 215,725 | |
Vested (shares) | (331,454) | |
Forfeited (shares) | (44,899) | |
Outstanding as of October 3, 2021 | 1,285,123 | |
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Weighted Average Grant Date Fair Value [Abstract] | ||
Outstanding at beginning of year (USD per share) | $ 135.11 | |
Weighted-average fair value at date of grant (USD per share) | 153.97 | $ 162.08 |
Performance assumption change (USD per share) | 147.96 | |
Vested (USD per share) | 116.59 | |
Forfeited (USD per share) | 148.39 | |
Outstanding as of October 3, 2021 (USD per share) | $ 146.64 |
STOCK COMPENSATION PLANS - SC_5
STOCK COMPENSATION PLANS - SCHEDULE OF PSUs AND RSUS FAIR VALUE WEIGHTED-AVERAGE ASSUMPTIONS (Details) - $ / shares | 9 Months Ended | |
Oct. 03, 2021 | Sep. 27, 2020 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Dividend yields | 2.20% | 2.10% |
Performance and restricted stock units | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Units granted (shares) | 392,419 | 340,526 |
Weighted-average fair value at date of grant (USD per share) | $ 153.97 | $ 162.08 |
Estimated values (USD per share) | $ 66.44 | $ 80.08 |
Dividend yields | 2.20% | 2.00% |
Expected volatility | 26.40% | 17.30% |
SEGMENT INFORMATION - NARRATIVE
SEGMENT INFORMATION - NARRATIVE (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Oct. 03, 2021 | Sep. 27, 2020 | Oct. 02, 2022 | Oct. 03, 2021 | Sep. 27, 2020 | |
North America | Geographic Concentration Risk | Revenue from Contract with Customer Benchmark | |||||
Revenue, Major Customer [Line Items] | |||||
Concentration Risk, Percentage | 90.00% | ||||
Operating Segments | Commodities futures and options | |||||
Revenue, Major Customer [Line Items] | |||||
Net Gain (Loss) On Commodity Derivative Positions Reclassified From Unallocated Derivative To Segment Income | $ (15,175) | $ (2,521) | $ (40,062) | $ (10,294) | |
Scenario, Forecast | Operating Segments | Commodities futures and options | |||||
Revenue, Major Customer [Line Items] | |||||
Net Gain (Loss) On Commodity Derivative Positions Reclassified From Unallocated Derivative To Segment Income | $ 57,391 | ||||
Cost of Sales | Commodities futures and options | |||||
Revenue, Major Customer [Line Items] | |||||
Cumulative Amount of Mark-to-Market Gains (Losses) on Commodity Derivatives | $ 86,675 |
SEGMENT INFORMATION - SCHEDULE
SEGMENT INFORMATION - SCHEDULE OF NET SALES AND EARNINGS BY SEGMENT (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Oct. 03, 2021 | Sep. 27, 2020 | Oct. 03, 2021 | Sep. 27, 2020 | |
Segment Reporting Information [Line Items] | ||||
Net sales | $ 2,359,839 | $ 2,219,829 | $ 6,645,209 | $ 5,964,475 |
Operating profit | 574,831 | 611,410 | 1,584,550 | 1,377,583 |
Long-lived asset impairment charges | 0 | 0 | 0 | 9,143 |
Cost associated with business realignment activities | 3,397 | 0 | 13,793 | 2,170 |
Interest expense, net | 30,154 | 37,258 | 97,655 | 111,592 |
Other (income) expense, net | 23,004 | 11,644 | 32,612 | 34,394 |
Income before income taxes | 521,673 | 562,508 | 1,454,283 | 1,231,597 |
Operating Segments | ||||
Segment Reporting Information [Line Items] | ||||
Operating profit | 704,788 | 671,586 | 2,008,276 | 1,762,763 |
Operating Segments | North America | ||||
Segment Reporting Information [Line Items] | ||||
Net sales | 2,125,627 | 2,014,152 | 5,986,692 | 5,442,760 |
Operating profit | 666,089 | 647,109 | 1,893,554 | 1,726,251 |
Operating Segments | International and Other | ||||
Segment Reporting Information [Line Items] | ||||
Net sales | 234,212 | 205,677 | 658,517 | 521,715 |
Operating profit | 38,699 | 24,477 | 114,722 | 36,512 |
Corporate, Non-Segment | ||||
Segment Reporting Information [Line Items] | ||||
Unallocated corporate expense | 145,028 | 131,934 | 434,070 | 363,384 |
Segment Reconciling Items | ||||
Segment Reporting Information [Line Items] | ||||
Unallocated mark-to-market (gains) losses on commodity derivatives | (18,468) | (71,758) | (24,137) | 10,483 |
Long-lived asset impairment charges | 0 | 0 | 0 | 9,143 |
Cost associated with business realignment activities | $ 3,397 | $ 0 | $ 13,793 | $ 2,170 |
SEGMENT INFORMATION - SCHEDUL_2
SEGMENT INFORMATION - SCHEDULE OF UNALLOCATED MARK-TO-MARKET (GAINS) LOSSES ON COMMODITY DERIVATIVES (Details) - Commodities futures and options - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Oct. 03, 2021 | Sep. 27, 2020 | Oct. 03, 2021 | Sep. 27, 2020 | |
Segment Reporting Information [Line Items] | ||||
Net (gains) losses on mark-to-market valuation of commodity derivative positions recognized in unallocated derivative (gains) losses | $ (18,468) | $ (71,758) | $ (24,137) | $ 10,483 |
Operating Segments | ||||
Segment Reporting Information [Line Items] | ||||
Net gains on commodity derivative positions reclassified from unallocated to segment income | 15,175 | 2,521 | 40,062 | 10,294 |
Non-designated Hedges | ||||
Segment Reporting Information [Line Items] | ||||
Unallocated mark-to-market (gains) losses on commodity derivatives | $ (33,643) | $ (74,279) | $ (64,199) | $ 189 |
SEGMENT INFORMATION - SCHEDUL_3
SEGMENT INFORMATION - SCHEDULE OF DEPRECIATION AND AMORTIZATION EXPENSE INCLUDED WITHIN SEGMENT INCOME (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Oct. 03, 2021 | Sep. 27, 2020 | Oct. 03, 2021 | Sep. 27, 2020 | |
Segment Reporting Information [Line Items] | ||||
Depreciation and amortization | $ 78,023 | $ 75,165 | $ 231,953 | $ 217,689 |
Operating Segments | North America | ||||
Segment Reporting Information [Line Items] | ||||
Depreciation and amortization | 59,216 | 56,518 | 175,238 | 164,599 |
Operating Segments | International and Other | ||||
Segment Reporting Information [Line Items] | ||||
Depreciation and amortization | 6,439 | 6,956 | 20,187 | 21,202 |
Corporate, Non-Segment | Corporate | ||||
Segment Reporting Information [Line Items] | ||||
Depreciation and amortization | $ 12,368 | $ 11,691 | $ 36,528 | $ 31,888 |
SEGMENT INFORMATION - SCHEDUL_4
SEGMENT INFORMATION - SCHEDULE OF SEGMENT INFORMATION BY GEOGRAPHY (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Oct. 03, 2021 | Sep. 27, 2020 | Oct. 03, 2021 | Sep. 27, 2020 | |
Revenue, Major Customer [Line Items] | ||||
Net sales | $ 2,359,839 | $ 2,219,829 | $ 6,645,209 | $ 5,964,475 |
United States | ||||
Revenue, Major Customer [Line Items] | ||||
Net sales | 2,017,378 | 1,914,316 | 5,681,498 | 5,185,858 |
All other countries | ||||
Revenue, Major Customer [Line Items] | ||||
Net sales | $ 342,461 | $ 305,513 | $ 963,711 | $ 778,617 |
SEGMENT INFORMATION - SCHEDUL_5
SEGMENT INFORMATION - SCHEDULE OF ADDITIONAL PRODUCT LINE SALES (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Oct. 03, 2021 | Sep. 27, 2020 | Oct. 03, 2021 | Sep. 27, 2020 | |
Segment Reporting Information [Line Items] | ||||
Net sales | $ 2,359,839 | $ 2,219,829 | $ 6,645,209 | $ 5,964,475 |
Confectionery and confectionery-based portfolio | ||||
Segment Reporting Information [Line Items] | ||||
Net sales | 2,190,223 | 2,078,582 | 6,183,741 | 5,578,997 |
Snacks portfolio | ||||
Segment Reporting Information [Line Items] | ||||
Net sales | $ 169,616 | $ 141,247 | $ 461,468 | $ 385,478 |
TREASURY STOCK ACTIVITY - SCHED
TREASURY STOCK ACTIVITY - SCHEDULE OF TREASURY STOCK ACTIVITY (Details) $ in Thousands | 9 Months Ended |
Oct. 03, 2021USD ($)shares | |
Class of Stock [Line Items] | |
Treasury Stock, Shares, Acquired | shares | 2,876,644 |
Shares Issued, Shares, Share-based Payment Arrangement, before Forfeiture | shares | (637,580) |
Treasury Stock Change in Shares | shares | 2,239,064 |
Stock Repurchased During Period, Value | $ | $ 457,946 |
Shares Issued, Value, Share-based Payment Arrangement, before Forfeiture | $ | (26,529) |
Treasury Stock Change in Value | $ | $ 431,417 |
Employee stock options | |
Class of Stock [Line Items] | |
Treasury Stock, Shares, Acquired | shares | 2,005,500 |
Stock Repurchased During Period, Value | $ | $ 307,929 |
Hershey Common Stock | |
Class of Stock [Line Items] | |
Treasury Stock, Shares, Acquired | shares | 871,144 |
Stock Repurchased During Period, Value | $ | $ 150,017 |
TREASURY STOCK ACTIVITY - NARRA
TREASURY STOCK ACTIVITY - NARRATIVE (Details) - USD ($) $ in Thousands | Oct. 03, 2021 | May 31, 2021 | Jul. 24, 2018 |
Equity, Class of Treasury Stock [Line Items] | |||
Stock repurchase program, remaining authorized repurchase amount | $ 109,983 | ||
2018 Share Repurchase Program | |||
Equity, Class of Treasury Stock [Line Items] | |||
Stock repurchase program, authorized amount | $ 500,000 | ||
2021 Share Repurchase Program | |||
Equity, Class of Treasury Stock [Line Items] | |||
Stock repurchase program, authorized amount | $ 500,000 |
NONCONTROLLING INTEREST - NARRA
NONCONTROLLING INTEREST - NARRATIVE (Details) | Jan. 19, 2021 |
Lotte Shanghai Food Company | Noncontrolling Interests in Subsidiaries | |
Class of Stock [Line Items] | |
Noncontrolling interest, ownership percentage by parent | 50.00% |
NONCONTROLLING INTEREST - SCHED
NONCONTROLLING INTEREST - SCHEDULE OF ACTIVITY RELATING TO THE NONCONTROLLING INTEREST (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Oct. 03, 2021 | Sep. 27, 2020 | Oct. 03, 2021 | Sep. 27, 2020 | |
Stockholders' Equity Attributable to Noncontrolling Interest [Roll Forward] | ||||
Balance, December 31, 2020 | $ 3,531 | |||
Net gain attributable to noncontrolling interest | $ 0 | $ (25) | 1,072 | $ (3,238) |
Divestiture of noncontrolling interest | (1,013) | |||
Balance, October 3, 2021 | 8,839 | 8,839 | ||
Noncontrolling Interests in Subsidiaries | ||||
Stockholders' Equity Attributable to Noncontrolling Interest [Roll Forward] | ||||
Balance, December 31, 2020 | 3,531 | |||
Net gain attributable to noncontrolling interest | 1,072 | |||
Divestiture of noncontrolling interest | (1,013) | |||
Other comprehensive income - foreign currency translation adjustments | 5,249 | |||
Balance, October 3, 2021 | $ 8,839 | $ 8,839 |
EARNINGS PER SHARE - SCHEDULE O
EARNINGS PER SHARE - SCHEDULE OF BASIC AND DILUTED EARNINGS PER SHARE (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Oct. 03, 2021 | Sep. 27, 2020 | Oct. 03, 2021 | Sep. 27, 2020 | |
Common stock | ||||
Basic earnings per share: | ||||
Allocation of distributed earnings (cash dividends paid) | $ 131,247 | $ 119,431 | $ 366,934 | $ 348,608 |
Allocation of undistributed earnings | 191,575 | 206,491 | 462,505 | 371,084 |
Total earnings—basic | $ 322,822 | $ 325,922 | $ 829,439 | $ 719,692 |
Total weighted-average shares—basic (shares) | 145,665 | 147,688 | 146,259 | 147,845 |
Earnings Per Share—basic (USD per share) | $ 2.22 | $ 2.21 | $ 5.67 | $ 4.87 |
Diluted earnings per share: | ||||
Allocation of total earnings used in basic computation | $ 322,822 | $ 325,922 | $ 829,439 | $ 719,692 |
Reallocation of total earnings as a result of conversion of Class B common stock to Common stock | 122,105 | 121,361 | 312,517 | 267,629 |
Reallocation of undistributed earnings | 0 | 0 | 0 | 0 |
Total earnings—diluted | $ 444,927 | $ 447,283 | $ 1,141,956 | $ 987,321 |
Conversion of Class B common stock to Common shares outstanding | 60,614 | 60,614 | 60,614 | 60,614 |
Total weighted-average shares—diluted (shares) | 207,426 | 209,140 | 207,857 | 209,424 |
Earnings Per Share—diluted (USD per share) | $ 2.14 | $ 2.14 | $ 5.49 | $ 4.71 |
Common stock | Employee stock options | ||||
Diluted earnings per share: | ||||
Incremental common shares attributable to dilutive effect of share-based payment arrangements | 625 | 557 | 613 | 599 |
Common stock | Performance and restricted stock units | ||||
Diluted earnings per share: | ||||
Incremental common shares attributable to dilutive effect of share-based payment arrangements | 522 | 281 | 371 | 366 |
Class B common stock | ||||
Basic earnings per share: | ||||
Allocation of distributed earnings (cash dividends paid) | $ 49,643 | $ 44,308 | $ 138,260 | $ 129,410 |
Allocation of undistributed earnings | 72,462 | 77,053 | 174,257 | 138,219 |
Total earnings—basic | $ 122,105 | $ 121,361 | $ 312,517 | $ 267,629 |
Total weighted-average shares—basic (shares) | 60,614 | 60,614 | 60,614 | 60,614 |
Earnings Per Share—basic (USD per share) | $ 2.01 | $ 2 | $ 5.16 | $ 4.42 |
Diluted earnings per share: | ||||
Allocation of total earnings used in basic computation | $ 122,105 | $ 121,361 | $ 312,517 | $ 267,629 |
Reallocation of total earnings as a result of conversion of Class B common stock to Common stock | 0 | 0 | 0 | 0 |
Reallocation of undistributed earnings | (369) | (317) | (847) | (654) |
Total earnings—diluted | $ 121,736 | $ 121,044 | $ 311,670 | $ 266,975 |
Conversion of Class B common stock to Common shares outstanding | 0 | 0 | 0 | 0 |
Total weighted-average shares—diluted (shares) | 60,614 | 60,614 | 60,614 | 60,614 |
Earnings Per Share—diluted (USD per share) | $ 2.01 | $ 2 | $ 5.14 | $ 4.40 |
Class B common stock | Employee stock options | ||||
Diluted earnings per share: | ||||
Incremental common shares attributable to dilutive effect of share-based payment arrangements | 0 | 0 | 0 | 0 |
Class B common stock | Performance and restricted stock units | ||||
Diluted earnings per share: | ||||
Incremental common shares attributable to dilutive effect of share-based payment arrangements | 0 | 0 | 0 | 0 |
EARNINGS PER SHARE - NARRATIVE
EARNINGS PER SHARE - NARRATIVE (Details) - shares shares in Thousands | 3 Months Ended | 9 Months Ended | ||
Oct. 03, 2021 | Sep. 27, 2020 | Oct. 03, 2021 | Sep. 27, 2020 | |
Employee stock options | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Antidilutive securities excluded from computation of earnings per share (shares) | 0 | 15 | 43 | 15 |
OTHER (INCOME) EXPENSE, NET - S
OTHER (INCOME) EXPENSE, NET - SCHEDULE OF OTHER (INCOME) AND EXPENSE, NET (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Oct. 03, 2021 | Sep. 27, 2020 | Oct. 03, 2021 | Sep. 27, 2020 | |
Other Income and Expenses [Abstract] | ||||
Write-down of equity investments | $ 20,963 | $ 10,707 | $ 28,734 | $ 29,257 |
Non-service cost components of net periodic benefit cost relating to pension and other post-retirement benefit plans | 1,952 | 940 | 3,772 | 4,895 |
Other (income) expense, net | 89 | (3) | 106 | 242 |
Other Nonoperating Income (Expense) | $ 23,004 | $ 11,644 | $ 32,612 | $ 34,394 |
SUPPLEMENTAL BALANCE SHEET IN_3
SUPPLEMENTAL BALANCE SHEET INFORMATION - SCHEDULE OF SUPPLEMENTAL BALANCE SHEET INFORMATION (Details) - USD ($) $ in Thousands | Oct. 03, 2021 | Dec. 31, 2020 |
Inventory, Net [Abstract] | ||
Raw materials | $ 403,374 | $ 388,600 |
Goods in process | 131,523 | 104,841 |
Finished goods | 662,073 | 645,664 |
Inventories at First In First Out | 1,196,970 | 1,139,105 |
Adjustment to Last In First Out | (170,429) | (174,898) |
Total inventories | 1,026,541 | 964,207 |
Prepaid Expense and Other Assets, Current [Abstract] | ||
Prepaid expenses | 68,242 | 95,669 |
Other current assets | 130,418 | 158,809 |
Total prepaid expenses and other | 198,660 | 254,478 |
Property, Plant and Equipment [Abstract] | ||
Land | 148,283 | 131,513 |
Buildings | 1,466,156 | 1,387,106 |
Machinery and equipment | 3,267,233 | 3,169,754 |
Construction in progress | 254,879 | 276,514 |
Property, plant and equipment, gross | 5,136,551 | 4,964,887 |
Accumulated depreciation | (2,766,358) | (2,679,632) |
Property, plant and equipment, net | 2,370,193 | 2,285,255 |
Other Assets, Noncurrent [Abstract] | ||
Capitalized software, net | 232,367 | 187,673 |
Operating lease ROU assets | 196,746 | 224,268 |
Investments in unconsolidated affiliates | 77,865 | 52,351 |
Other non-current assets | 121,708 | 91,595 |
Total other non-current assets | 628,686 | 555,887 |
Accrued Liabilities, Current [Abstract] | ||
Payroll, compensation and benefits | 237,934 | 237,342 |
Advertising, promotion and product allowances | 323,903 | 309,537 |
Operating lease liabilities | $ 25,156 | $ 36,578 |
Operating lease liabilities, extensible list | Total accrued liabilities | Total accrued liabilities |
Other | $ 164,979 | $ 198,309 |
Total accrued liabilities | 751,972 | 781,766 |
Other Liabilities, Noncurrent [Abstract] | ||
Post-retirement benefits liabilities | 214,954 | 223,507 |
Pension benefits liabilities | 46,183 | 70,727 |
Operating lease liabilities | $ 166,827 | $ 181,871 |
Operating lease liabilities, extensible list | Total other long-term liabilities | Total other long-term liabilities |
Other | $ 211,932 | $ 207,329 |
Total other long-term liabilities | 639,896 | 683,434 |
Accumulated Other Comprehensive Income (Loss), Net of Tax [Abstract] | ||
Foreign currency translation adjustments | (95,941) | (98,525) |
Pension and post-retirement benefit plans, net of tax | (165,621) | (194,205) |
Cash flow hedges, net of tax | (36,838) | (45,352) |
Total accumulated other comprehensive loss | $ (298,400) | $ (338,082) |