Document and Entity Information
Document and Entity Information - shares | 6 Months Ended | |
Jul. 03, 2015 | Jul. 21, 2015 | |
Entity Information [Line Items] | ||
Document Type | 10-Q | |
Amendment Flag | false | |
Document Period End Date | Jul. 3, 2015 | |
Document Fiscal Year Focus | 2,015 | |
Document Fiscal Period Focus | Q2 | |
Trading Symbol | AXE | |
Entity Registrant Name | ANIXTER INTERNATIONAL INC | |
Entity Central Index Key | 52,795 | |
Current Fiscal Year End Date | --01-01 | |
Entity Filer Category | Large Accelerated Filer | |
Entity Common Stock, Shares Outstanding | 32,969,473 |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME - Entity [Domain] - USD ($) shares in Millions, $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jul. 03, 2015 | Jul. 04, 2014 | Jul. 03, 2015 | Jul. 04, 2014 | |
Net sales | $ 1,480.4 | $ 1,342.9 | $ 2,865.5 | $ 2,617.2 |
Cost of goods sold | 1,151.5 | 1,039.6 | 2,227.3 | 2,022.1 |
Gross profit | 328.9 | 303.3 | 638.2 | 595.1 |
Operating expenses | 264.4 | 226.1 | 514.4 | 447.9 |
Operating income | 64.5 | 77.2 | 123.8 | 147.2 |
Other expense: | ||||
Interest expense | (12.7) | (9) | (26.9) | (19.1) |
Other, net | (3.5) | (1.9) | (7.5) | (11.6) |
Income from continuing operations before income taxes | 48.3 | 66.3 | 89.4 | 116.5 |
Income tax expense from continuing operations | 18.8 | 21.8 | 33.4 | 34.3 |
Net income from continuing operations | 29.5 | 44.5 | 56 | 82.2 |
Income from discontinued operations before income taxes (including gain on disposal of $42.3) | 46.5 | 13.4 | 57.7 | 27.4 |
Income tax expense from discontinued operations | 4.6 | 4.1 | 23.2 | 8.4 |
Net income from discontinued operations | 41.9 | 9.3 | 34.5 | 19 |
Net income | $ 71.4 | $ 53.8 | $ 90.5 | $ 101.2 |
Basic: | ||||
Continuing operations | $ 0.89 | $ 1.35 | $ 1.69 | $ 2.49 |
Discontinued operations | 1.26 | 0.28 | 1.04 | 0.58 |
Net income | 2.15 | 1.63 | 2.73 | 3.07 |
Diluted: | ||||
Continuing operations | 0.88 | 1.33 | 1.68 | 2.47 |
Discontinued operations | 1.26 | 0.28 | 1.03 | 0.57 |
Net income | $ 2.14 | $ 1.61 | $ 2.71 | $ 3.04 |
Basic weighted-average common shares outstanding | 33.2 | 33 | 33.2 | 33 |
Effect of dilutive securities: | ||||
Stock options and units | 0.2 | 0.3 | 0.2 | 0.3 |
Diluted weighted-average common shares outstanding | 33.4 | 33.3 | 33.4 | 33.3 |
Comprehensive Income (Loss), Net of Tax, Attributable to Parent [Abstract] | ||||
Net income | $ 71.4 | $ 53.8 | $ 90.5 | $ 101.2 |
Foreign currency translation | 2.4 | 15 | (38.6) | 8.6 |
Changes in unrealized pension cost, net of tax | 4.2 | (0.1) | 5.1 | (0.3) |
Changes in fair market value of derivatives | 0 | (0.1) | (0.1) | (0.1) |
Other comprehensive income (loss) | 6.6 | 14.8 | (33.6) | 8.2 |
Comprehensive income | $ 78 | $ 68.6 | $ 56.9 | $ 109.4 |
CONDENSED CONSOLIDATED STATEME3
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (Parenthetical) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jul. 03, 2015 | Jul. 04, 2014 | Jul. 03, 2015 | Jul. 04, 2014 | |
Statement of Financial Position (Parenthetical) [Abstract] | ||||
Discontinued Operation, Gain (Loss) from Disposal of Discontinued Operation, before Income Tax | $ 42.3 | $ 0 | $ 42.3 | $ 0 |
CONDENSED CONSOLIDATED BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS - Entity [Domain] - USD ($) $ in Millions | Jul. 03, 2015 | Jan. 02, 2015 |
Current assets: | ||
Cash and cash equivalents | $ 206.2 | $ 92 |
Accounts receivable (Includes $405.9 and $548.5 at July 3, 2015 and January 2, 2015, respectively, associated with securitization facility) | 1,177.6 | 1,171 |
Inventories | 865.1 | 859 |
Deferred income taxes | 33.4 | 33.7 |
Other current assets | 50.9 | 54.9 |
Current assets of discontinued operations | 47.6 | 379.2 |
Total current assets | 2,380.8 | 2,589.8 |
Property and equipment, at cost | 310.3 | 305.3 |
Accumulated depreciation | (198.3) | (201.1) |
Net property and equipment | 112 | 104.2 |
Goodwill | 577.3 | 582.3 |
Other assets | 265.3 | 282.5 |
Long-term assets of discontinued operations | 0 | 27.7 |
Total assets | 3,335.4 | 3,586.5 |
Current liabilities: | ||
Accounts payable | 773.3 | 738.5 |
Accrued expenses | 193.3 | 183.2 |
Current liabilities of discontinued operations | 29.8 | 108.8 |
Total current liabilities | 996.4 | 1,030.5 |
Long-term debt (Includes $0.0 and $65.0 at July 3, 2015 and January 2, 2015, respectively, associated with securitization facility) | 940.7 | 1,207.7 |
Other liabilities | 198 | 215.1 |
Long-term liabilities of discontinued operations | 4.5 | 0.2 |
Total liabilities | 2,139.6 | 2,453.5 |
Stockholders’ equity: | ||
Common stock - $1.00 par value, 100,000,000 shares authorized, 33,259,976 and 33,141,950 shares issued and outstanding at July 3, 2015 and January 2, 2015, respectively | 33.3 | 33.1 |
Capital surplus | 243.8 | 238.2 |
Retained earnings | 1,090.3 | 999.7 |
Accumulated other comprehensive loss: | ||
Foreign currency translation | (97.7) | (59.1) |
Unrecognized pension liability, net | (73.9) | (79) |
Unrealized gain on derivatives, net | 0 | 0.1 |
Total accumulated other comprehensive loss | (171.6) | (138) |
Total stockholders’ equity | 1,195.8 | 1,133 |
Total liabilities and stockholders’ equity | $ 3,335.4 | $ 3,586.5 |
CONDENSED CONSOLIDATED BALANCE5
CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) $ in Millions | Jul. 03, 2015 | Jan. 02, 2015 |
Accounts receivable | $ 405.9 | $ 548.5 |
Common stock, par value | $ 1 | $ 1 |
Common stock, shares authorized | 100,000,000 | 100,000,000 |
Common stock, shares issued | 33,259,976 | 33,141,950 |
Common stock, shares outstanding | 33,259,976 | 33,141,950 |
Long-term debt | $ 940.7 | $ 1,207.7 |
Accounts receivable securitization facility | ||
Long-term debt | $ 0 | $ 65 |
CONDENSED CONSOLIDATED STATEME6
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - Entity [Domain] - USD ($) $ in Millions | 6 Months Ended | |
Jul. 03, 2015 | Jul. 04, 2014 | |
Operating activities: | ||
Net income | $ 90.5 | $ 101.2 |
Adjustments to reconcile net income to net cash provided by operating activities: | ||
Gain on sale of business, net of tax of $10.0M | (49.3) | 0 |
Depreciation | 11.9 | 11.4 |
Amortization of intangible assets | 10.7 | 3.9 |
Stock-based compensation | 7.4 | 6.6 |
Accretion of debt discount | 0.8 | 0.5 |
Amortization of deferred financing costs | 0.7 | 0.7 |
Deferred income taxes | 0 | (3.8) |
Excess income tax benefit from employee stock plans | (0.5) | (3.6) |
Pension plan contributions | (12.1) | (8.3) |
Pension plan expenses | 5.9 | 2.3 |
Changes in current assets and liabilities, net | (30.5) | (22.4) |
Other, net | 3.8 | (1.8) |
Net cash provided by operating activities | 39.3 | 86.7 |
Investing activities: | ||
Proceeds from sale of business | 358 | 0 |
Capital expenditures, net | (22.1) | (17.1) |
Other | 2.2 | 0 |
Net cash provided by (used in) investing activities | 338.1 | (17.1) |
Financing activities: | ||
Proceeds from borrowings | 508.8 | 625.4 |
Repayments of borrowings | (573.8) | (606.1) |
Excess income tax benefit from employee stock plans | 0.5 | 3.6 |
Proceeds from stock options exercised | 0 | 4.2 |
Deferred financing costs | 0 | (0.5) |
Other | (1) | (1.7) |
Net cash used in financing activities | (268) | (7.4) |
Increase in cash and cash equivalents | 109.4 | 62.2 |
Effect of exchange rate on cash balances | 4.8 | 1.9 |
Cash and cash equivalents at beginning of period | 92 | 57.3 |
Cash and cash equivalents at end of period | 206.2 | 121.4 |
Senior notes due 2015 | ||
Financing activities: | ||
Retirement of Debt | (200) | 0 |
Term loan | ||
Financing activities: | ||
Retirement of Debt | (2.5) | 0 |
Senior notes due 2014 | ||
Financing activities: | ||
Retirement of Debt | $ 0 | $ (32.3) |
CONDENSED CONSOLIDATED STATEME7
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Parenthetical) $ in Millions | 6 Months Ended |
Jul. 03, 2015USD ($) | |
Statement of Cash Flows [Abstract] | |
Gain on sale of business, net of tax | $ 10 |
SUMMARY OF SIGNIFICANT ACCOUNTI
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 6 Months Ended |
Jul. 03, 2015 | |
Accounting Policies [Abstract] | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Basis of presentation: Anixter International Inc. and its subsidiaries (collectively referred to as "Anixter" or the "Company") are sometimes referred to in this Quarterly Report on Form 10-Q as "we", "our", "us", or "ourselves." The condensed consolidated financial information furnished herein reflects all adjustments (consisting of normal recurring accruals), which are, in the opinion of management, necessary for a fair presentation of the Condensed Consolidated Financial Statements for the periods shown. Certain prior period amounts have been reclassified to conform to the current year presentation. The results of operations of any interim period are not necessarily indicative of the results that may be expected for a full fiscal year. Recently issued and adopted accounting pronouncements: In April 2014, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") No. 2014-8 Reporting Discontinued Operations and Disclosures of Disposals of Components of an Entity. This update changes the criteria for determining which disposals can be presented as discontinued operations and modifies related disclosure requirements. Under the new guidance, a discontinued operation is defined as a disposal of a component or group of components that is disposed of or is classified as held for sale and represents a strategic shift that has a major effect on an entity's operations and financial results. The guidance is effective for entities with annual periods beginning on or after December 15, 2014. This accounting guidance applies prospectively to new disposals and new classifications of disposal groups held for sale. We adopted this guidance in the first quarter of fiscal year 2015. See Note 2. "Discontinued Operations" for applicable disclosures. Recently issued accounting pronouncements not yet adopted: On April 15, 2015, the FASB issued ASU 2015-04, Practical Expedient for the Measurement Date of an Employer's Defined Benefit Obligation and Plan Assets , which permits a reporting entity with a fiscal year-end that does not coincide with a month-end to measure defined benefit plan assets and obligations using the month-end that is closest to the entity's fiscal year-end and apply that practical expedient consistently from year to year. The standard is effective for our financial statements issued for fiscal years beginning after December 15, 2016, and interim periods within those fiscal years. Early adoption is permitted. The new guidance should be applied on a prospective basis. The adoption of this standard is not expected to have a material impact on our consolidated financial statements. On April 7, 2015, the FASB issued ASU 2015-03, Simplifying the Presentation of Debt Issuance Costs , which requires debt issuance costs to be presented in the balance sheet as a direct deduction from the associated debt liability. The standard is effective for our financial statements issued for fiscal years beginning after December 15, 2015, and interim periods within those fiscal years. Early adoption is permitted for financial statements that have not been previously issued. The new guidance will be applied on a retrospective basis. The adoption of this standard is not expected to have a material impact on our consolidated financial statements. In May 2014, the FASB issued ASU 2014-09, Revenue from Contracts with Customers , which provides guidance for revenue recognition. The update’s core principle is that a company will recognize revenue when it transfers promised goods or services to customers in an amount that reflects the consideration to which the company expects to be entitled in exchange for those goods or services. In doing so, companies will need to use more judgment and make more estimates than under current guidance. Examples of the use of judgments and estimates may include identifying performance obligations in the contract, estimating the amount of variable consideration to include in the transaction price and allocating the transaction price to each separate performance obligation. The update also requires more detailed disclosures to enable users of financial statements to understand the nature, amount, timing, and uncertainty of revenue and cash flows arising from contracts with customers. The update provides for two transition methods to the new guidance: a retrospective approach and a modified retrospective approach. The guidance is effective for fiscal years, and interim periods within those years, beginning after December 15, 2017. Early adoption is permitted as of the original effective date. We are currently in the process of evaluating the transition methods and the impact of adoption of this ASU on our consolidated financial statements. We do not believe that any other recently issued, but not yet effective, accounting pronouncements, if adopted, would have a material impact on our consolidated financial statements or disclosures. Other, net: The following represents the components of "Other, net" as reflected in the Condensed Consolidated Statements of Comprehensive Income : Three Months Ended Six Months Ended July 3, July 4, July 3, July 4, (In millions) As Adjusted (see Note 2) As Adjusted (see Note 2) Other, net: Foreign exchange $ (2.4 ) $ (1.0 ) $ (6.0 ) $ (2.4 ) Foreign exchange devaluations — — (0.7 ) (8.0 ) Cash surrender value of life insurance policies (0.6 ) 0.5 — 0.8 Other (0.5 ) (1.4 ) (0.8 ) (2.0 ) Total other, net $ (3.5 ) $ (1.9 ) $ (7.5 ) $ (11.6 ) In the first quarter of 2014, the Venezuelan government changed its policy regarding the bolivar, which required us to use the Complementary System for the Administration of Foreign Currency ("SICAD") rate of 49.0 bolivars to one U.S. Dollar ("USD") to repatriate cash from Venezuela. In the first quarter of 2014, the Argentine peso was also devalued from 6.5 pesos to one USD to approximately 8.0 pesos to one USD after the central bank scaled back its intervention in a bid to preserve USD cash reserves. As a result of these devaluations, we recorded foreign exchange losses in these two countries of $8.0 million in the first quarter of 2014. In the first quarter of 2015, the Venezuelan government changed its policy regarding the bolivar, which we believe will now require us to use the Sistema Marginal de Divisas or Marginal Exchange System ("SIMADI") a "completely free floating" rate. As a result, we believe that the current rate of approximately 197.0 bolivars to one USD will be the rate available to us in the event we repatriate cash from Venezuela. As a result of the devaluation in the first quarter of 2015, we recorded a foreign exchange loss of $0.7 million in the first quarter of 2015. Several of our subsidiaries conduct business in a currency other than the legal entity’s functional currency. Transactions may produce receivables or payables that are fixed in terms of the amount of foreign currency that will be received or paid. A change in exchange rates between the functional currency and the currency in which a transaction is denominated increases or decreases the expected amount of functional currency cash flows upon settlement of the transaction. The increase or decrease in expected functional currency cash flows is a foreign currency transaction gain or loss that is included in "Other, net" in the Condensed Consolidated Statements of Comprehensive Income . We purchase foreign currency forward contracts to minimize the effect of fluctuating foreign currency-denominated accounts on our reported income. The foreign currency forward contracts are not designated as hedges for accounting purposes. Our strategy is to negotiate terms for our derivatives and other financial instruments to be highly effective, such that the change in the value of the derivative perfectly offsets the impact of the underlying hedged item (e.g., various foreign currency-denominated accounts). Our counterparties to foreign currency forward contracts have investment-grade credit ratings. We expect the creditworthiness of our counterparties to remain intact through the term of the transactions. We regularly monitor the creditworthiness of our counterparties to ensure no issues exist which could affect the value of the derivatives. While our derivatives are all subject to master netting arrangements, we present our assets and liabilities related to derivative instruments on a gross basis within the Condensed Consolidated Balance Sheets. The gross amount of our derivative assets and liabilities are immaterial. We do not hedge 100% of our foreign currency-denominated accounts. In addition, the results of hedging can vary significantly based on various factors, such as the timing of executing the foreign currency forward contracts versus the movement of the currencies as well as the fluctuations in the account balances throughout each reporting period. The fair value of the foreign currency forward contracts is based on the difference between the contract rate and the current exchange rate. The fair value of the foreign currency forward contracts is measured using observable market information. These inputs would be considered Level 2 in the fair value hierarchy. At July 3, 2015 and January 2, 2015 , foreign currency forward contracts were revalued at then-current foreign exchange rates with the changes in valuation reflected directly in "Other, net" in the Condensed Consolidated Statements of Comprehensive Income offsetting the transaction gain/loss recorded on the foreign currency-denominated accounts. At July 3, 2015 and January 2, 2015 , the gross notional amount of foreign currency forward contracts outstanding was approximately $238.6 million and $222.9 million , respectively. All of our foreign currency forward contracts are subject to master netting arrangements with our counterparties. As a result, at July 3, 2015 and January 2, 2015 , the net notional amount of the foreign currency forward contracts outstanding was approximately $142.6 million and $121.9 million , respectively. The combined effect of changes in both the equity and bond markets resulted in changes in the cash surrender value of our owned life insurance policies associated with our sponsored deferred compensation program. Accumulated other comprehensive income (loss): We accumulated unrealized gains and losses in "Accumulated other comprehensive income (loss)" ("AOCI") which are also reported in " Other comprehensive income (loss) " on the Condensed Consolidated Statements of Comprehensive Income . These include unrealized gains and losses related to our defined benefit obligations, certain immaterial derivative transactions that have been designated as cash flow hedges and foreign currency translation. See Note 7. "Pension Plans" for pension related amounts reclassified into net income. Our investments in several subsidiaries are recorded in currencies other than the USD. As these foreign currency denominated investments are translated at the end of each period during consolidation using period-end exchange rates, fluctuations of exchange rates between the foreign currency and the USD increase or decrease the value of those investments. These fluctuations and the results of operations for foreign subsidiaries, where the functional currency is not the USD, are translated into USD using the average exchange rates during the periods reported, while the assets and liabilities are translated using period-end exchange rates. The assets and liabilities-related translation adjustments are recorded as a separate component of AOCI, "Foreign currency translation." In addition, as our subsidiaries maintain investments denominated in currencies other than local currencies, exchange rate fluctuations will occur. Borrowings are raised in certain foreign currencies to minimize the exchange rate translation adjustment risk. |
DISCONTINUED OPERATIONS
DISCONTINUED OPERATIONS | 6 Months Ended |
Jul. 03, 2015 | |
Discontinued Operations and Disposal Groups [Abstract] | |
Disposal Groups, Including Discontinued Operations, Disclosure [Text Block] | DISCONTINUED OPERATIONS On February 9, 2015, our Board of Directors approved the disposition of the OEM Supply - Fasteners ("Fasteners") business. On February 11, 2015, through our wholly-owned subsidiary Anixter Inc., we entered into a definitive asset purchase agreement with American Industrial Partners ("AIP") to sell the Fasteners business for $380.0 million in cash, subject to certain post-closing adjustments. Under the terms of the agreement, $10.0 million of the purchase price is payable upon the buyer's acceptance of a stand-alone data center. On June 1, 2015, we completed the sale of the Fasteners business to AIP, resulting in initial cash proceeds of $358.0 million . In addition, we have recorded a $14.9 million receivable based on the preliminary calculation of the net working capital adjustment under the agreement. Including transaction related costs of $17.0 million , the sale resulted in a pre-tax gain of $42.3 million ( $32.3 million , net of tax). This transaction gives us a sharper strategic focus on our core Enterprise Cabling and Security Solutions ("ECS") and Electrical and Electronic Wire and Cable ("W&C") segments and provides additional financial flexibility to build on these strong global platforms through organic investments or strategic acquisitions. The assets and liabilities and operating results of the Fasteners business for the six months ended July 3, 2015 are presented as "Discontinued Operations" in our Condensed Consolidated Financial Statements. Accordingly, all prior periods have been revised to reflect this classification. We allocated interest costs to discontinued operations as a result of the sale of the Fasteners business. The allocated interest costs were $0.6 million and $1.0 million in the second quarter of 2015 and 2014, respectively, and $1.1 million and $2.1 million for the six months ended July 3, 2015 and July 4, 2014 , respectively. This represents the amount of interest costs not directly attributable to our other operations that would not have been incurred if we had the proceeds from the sale of the Fasteners business at the beginning of the respective periods. The methodology is consistent with the interest costs we expect to incur after the sale of the Fasteners business. In connection with the disposition of the Fasteners business, we recognized a pension curtailment gain of $5.1 million for the three and six months ended July 3, 2015 . The following represents the components of the results from discontinued operations as reflected in our Condensed Consolidated Statements of Comprehensive Income : Three Months Ended Six Months Ended (In millions) July 3, July 4, July 3, July 4, Net sales $ 148.4 $ 243.1 $ 397.8 $ 492.6 Operating income $ 5.2 $ 15.1 $ 17.1 $ 30.8 Income from discontinued operations before income taxes $ 4.2 $ 13.4 $ 15.4 $ 27.4 Gain on sale of discontinued operations $ 42.3 $ — $ 42.3 $ — Income tax expense from discontinued operations $ 4.6 $ 4.1 $ 23.2 $ 8.4 Net income from discontinued operations $ 41.9 $ 9.3 $ 34.5 $ 19.0 As reflected on our Condensed Consolidated Balance Sheets as of July 3, 2015 and January 2, 2015 , the components of assets and liabilities of the Fasteners businesses classified as "Discontinued Operations" are as follows: (In millions) July 3, January 2, Assets of discontinued operations: Accounts receivable $ 32.9 $ 158.2 Inventories 8.9 213.8 Net property and equipment — 16.8 Other assets 5.8 18.1 Total assets of discontinued operations $ 47.6 $ 406.9 Liabilities of discontinued operations: Accounts payable $ 10.7 $ 92.8 Accrued expenses 18.9 16.0 Other liabilities 4.7 0.2 Total liabilities of discontinued operations $ 34.3 $ 109.0 As of July 3, 2015, in accordance with the asset purchase agreement, the sale of the Fastener businesses in several countries will be completed within nine months. Therefore, these assets and liabilities are classified as "Discontinued Operations." The components of the results from discontinued operations reflected in our Condensed Consolidated Statements of Cash Flows were immaterial. |
BUSINESS COMBINATION
BUSINESS COMBINATION | 6 Months Ended |
Jul. 03, 2015 | |
Business Combinations [Abstract] | |
Business Combination Disclosure [Text Block] | BUSINESS COMBINATION On September 17, 2014, we acquired 100% of the outstanding capital stock of Tri-Northern Acquisition Holdings, Inc. ("Tri-Ed"), a leading independent distributor of security and low-voltage technology products, from Tri-NVS Holdings, LLC for $418.5 million (net of cash acquired of $11.6 million and a favorable net working capital adjustment of $2.3 million ). The acquisition was financed using borrowings under the 5-year senior unsecured revolving credit agreement, the accounts receivable securitization facility, available cash and the $200.0 million term loan. A portion of the proceeds from a subsequent issuance of $400.0 million principal amount of senior notes was used to repay certain incurred borrowings to finance the Tri-Ed acquisition. The acquisition of Tri-Ed presents a strategic opportunity for us and our security business, consistent with our vision to create a leading global security platform and to accelerate profitable revenue growth. Through expanding our offering into highly complementary product lines, we believe our customers will benefit from a broader set of products and solutions in the areas of video, access control, fire/life safety, and intrusion detection. In addition, this transaction provides access to the residential construction end market at an attractive point in the recovery cycle as well as security integrators and dealers we do not currently service. The following table sets forth the preliminary purchase price allocation, as of the acquisition date, for Tri-Ed. The purchase price allocation is preliminary pending finalization of the valuation of the acquired intangible assets and related deferred tax liabilities, which is expected to be completed in 2015. (In millions) Cash $ 11.6 Current assets, net 203.9 Property and equipment 2.7 Goodwill 243.5 Intangible assets 166.8 Current liabilities (144.6 ) Non-current liabilities (56.1 ) Total purchase price $ 427.8 All Tri-Ed goodwill, other assets and liabilities were recorded in the ECS reportable segment. The goodwill resulting from the acquisition largely consists of our expected future product sales and synergies from combining Tri-Ed’s products with our existing product offerings. Other than $12.2 million , the remaining goodwill is not deductible for tax purposes. The following table sets forth the components of preliminary identifiable intangible assets acquired and their estimated useful lives as of the date of the acquisition: (In millions) Average useful life (in years) Fair value Customer relationships 11-18 $ 120.6 Exclusive supplier agreement 21 23.2 Trade names Indefinite 10.6 Tri-Ed trade names 4 9.2 Non-compete agreements 4-5 3.2 Total intangible assets $ 166.8 The following unaudited pro forma information shows our results of operations as if the acquisition of Tri-Ed had been completed as of the beginning of fiscal 2014. Adjustments have been made for the pro forma effects of interest expense and deferred financing costs related to the financing of the business combination, depreciation and amortization of tangible and intangible assets recognized as part of the business combination, related income taxes and various other costs which would not have been incurred had we and Tri-Ed operated as a combined entity (i.e., management fees paid by Tri-Ed to its former owners). Three Months Ended Six Months Ended (In millions, except per share amounts) July 4, July 4, Net sales $ 1,491.9 $ 2,908.0 Net income from continuing operations $ 45.8 $ 83.7 Income per share from continuing operations: Basic $ 1.39 $ 2.54 Diluted $ 1.37 $ 2.51 Since the date of acquisition, the Tri-Ed results are reflected in our Condensed Consolidated Financial Statements. For the six months ended July 3, 2015 , Tri-Ed added approximately $304 million of revenue and $12 million in operating income, to our consolidated results. |
RESTRUCTURING AND OTHER CHARGES
RESTRUCTURING AND OTHER CHARGES RESTRUCTURING AND OTHER CHARGES | 6 Months Ended |
Jul. 03, 2015 | |
Restructuring and Related Activities [Abstract] | |
RESTRUCTURING AND OTHER CHARGES | RESTRUCTURING AND OTHER CHARGES We consider restructuring activities to be programs whereby we fundamentally change our operations, such as closing and consolidating facilities, reducing headcount and realigning operations in response to changing market conditions. In the second quarter of 2015, we recorded a pre-tax charge of $3.1 million and $2.2 million in our ECS and W&C segments, respectively, for severance-related expenses associated with a reduction of approximately 100 positions. The $5.3 million charge reflects actions we are taking to improve efficiencies and eliminate the stranded costs in conjunction with the sale of the Fasteners business. This charge is included in "Operating expenses" in our Condensed Consolidated Statements of Comprehensive Income for the three and six months ended July 3, 2015 . The majority of the remaining accrual related to this charge of $4.7 million as of July 3, 2015 is expected to be paid by the second quarter of 2016. The second quarter of 2015 also includes a write off of capitalized software of $3.1 million that has no ongoing economic benefit to continuing operations, $2.6 million of bad debt expense related to a customer in Venezuela, a $1.7 million dilapidation provision related to our leasehold properties, $1.0 million of acquisition and integration costs and $0.4 million related to pension divestiture costs. |
INCOME TAXES
INCOME TAXES | 6 Months Ended |
Jul. 03, 2015 | |
Income Tax Disclosure [Abstract] | |
INCOME TAXES | INCOME TAXES Our effective tax rate from continuing operations for the second quarter of 2015 was 38.8% compared to 32.9% in the prior year period. The prior year period included a net tax benefit of $2.0 million primarily related to the reversal of deferred income tax valuation allowances in Europe. Other differences in the comparable tax rate relate to our worldwide country mix of income. Our effective tax rate from continuing operations for the six months ended July 3, 2015 was 37.3% compared to 29.4% in the prior year period. The prior year period included a net tax benefit of $6.9 million primarily related to the reversal of deferred income tax valuation allowances in Europe. Other differences in the comparable tax rate relate to our worldwide country mix of income. Our six months ended July 3, 2015 effective tax rate differs from the U.S. federal statutory rate primarily as a result of U.S. state taxes and our worldwide country mix of income. As of January 2, 2015, we asserted permanent reinvestment of all non-U.S. earnings, including the non-U.S. earnings of the Fasteners business. As a result of the disposition of the Fasteners business, we are no longer permanently reinvested with respect to the non-U.S. earnings of the Fasteners business, because we repatriated to the U.S. most of the net proceeds attributable to the sale of the non-U.S. Fasteners business via intercompany debt repayment, dividend or other means. During the second quarter of 2015, we refined the anticipated repatriation amount and the estimated tax impact of the change in the reinvestment assertion, and we reduced the first quarter estimate by $4.9 million . Therefore, our six months ended July 3, 2015 results include, as a component of discontinued operations, $10.3 million expense for U.S. federal and state, and foreign income taxes and withholding taxes related to this change in our reinvestment assertion. |
DEBT
DEBT | 6 Months Ended |
Jul. 03, 2015 | |
Debt Disclosure [Abstract] | |
DEBT | DEBT Debt is summarized below: (In millions) July 3, January 2, Long-term debt: Senior notes due 2021 $ 394.5 $ 394.2 Senior notes due 2019 346.3 345.9 Term loan 196.3 198.8 Accounts receivable securitization facility — 65.0 Revolving lines of credit — — Senior notes due 2015 — 200.0 Other 3.6 3.8 Total long-term debt $ 940.7 $ 1,207.7 At July 3, 2015 , our total carrying value and estimated fair value of debt outstanding was $940.7 million and $979.6 million , respectively. This compares to a carrying value and estimated fair value at January 2, 2015 of $1,207.7 million and $1,243.8 million , respectively. The estimated fair value of our debt instruments is measured using observable market information which would be considered Level 2 inputs as described in the fair value accounting guidance on fair value measurements. Our weighted-average cost of borrowings was 4.7% and 4.6% for the three months ended July 3, 2015 and July 4, 2014 , respectively, and 4.6% and 4.7% for the six months ended July 3, 2015 and July 4, 2014 , respectively. Retirement of Debt In the first quarter of 2015, we retired our 5.95% Senior notes due 2015 upon maturity for $200.0 million . Available borrowings under existing long-term financing agreements were used to settle the maturity value. In the first quarter of 2014, we retired our 10% Senior notes due 2014 upon maturity for $32.3 million . Available borrowings under existing long-term financing agreements were used to settle the maturity value. Accounts Receivable Securitization Program Under our accounts receivable securitization program, we sell, on an ongoing basis without recourse, a portion of our accounts receivables originating in the United States to Anixter Receivables Corporation ("ARC"), which is considered a wholly-owned, bankruptcy-remote variable interest entity ("VIE"). We have the authority to direct the activities of the VIE and, as a result, we have concluded that we maintain control of the VIE, are the primary beneficiary (as defined by accounting guidance) and, therefore, consolidate the account balances of ARC. As of July 3, 2015 and January 2, 2015 , $405.9 million and $548.5 million of our receivables were sold to ARC, respectively. ARC in turn assigns a collateral interest in these receivables to a financial institution for proceeds up to $300 million . The assets of ARC are not available to us until all obligations of ARC are satisfied in the event of bankruptcy or insolvency proceedings. |
PENSION PLANS
PENSION PLANS | 6 Months Ended |
Jul. 03, 2015 | |
Compensation and Retirement Disclosure [Abstract] | |
PENSION PLANS | PENSION PLANS We have various defined benefit and defined contribution pension plans. Our defined benefit pension plans are the plans in the United States, which consist of the Anixter Inc. Pension Plan, the Executive Benefit Plan and the Supplemental Executive Retirement Plan ("SERP") (together the "Domestic Plans") and various defined benefit pension plans covering employees of foreign subsidiaries in Canada and Europe (together the "Foreign Plans"). The majority of our defined benefit pension plans are non-contributory and cover substantially all full-time domestic employees and certain employees in other countries. Retirement benefits are provided based on compensation as defined in both the Domestic Plans and the Foreign Plans. Our policy is to fund all Domestic Plans as required by the Employee Retirement Income Security Act of 1974 ("ERISA") and the Internal Revenue Service ("IRS") and all Foreign Plans as required by applicable foreign laws. The Executive Benefit Plan and SERP are the only two plans that are unfunded. Assets in the various plans consist primarily of equity securities and fixed income investments. Components of net periodic pension cost (benefit) are as follows: Three Months Ended Domestic Foreign Total (In millions) July 3, July 4, July 3, July 4, July 3, July 4, Service cost $ 1.7 $ 1.2 $ 1.6 $ 1.5 $ 3.3 $ 2.7 Interest cost 4.1 2.7 2.3 2.7 6.4 5.4 Expected return on plan assets (5.3 ) (3.4 ) (2.7 ) (3.2 ) (8.0 ) (6.6 ) Net amortization (a) 0.5 (0.5 ) 0.8 0.3 1.3 (0.2 ) Net periodic cost $ 1.0 $ — $ 2.0 $ 1.3 $ 3.0 $ 1.3 Six Months Ended Domestic Foreign Total (In millions) July 3, July 4, July 3, July 4, July 3, July 4, Service cost $ 3.0 $ 2.4 $ 3.3 $ 3.0 $ 6.3 $ 5.4 Interest cost 6.7 5.3 4.6 5.4 11.3 10.7 Expected return on plan assets (8.8 ) (6.9 ) (5.3 ) (6.4 ) (14.1 ) (13.3 ) Net amortization (a) 0.9 (1.1 ) 1.5 0.6 2.4 (0.5 ) Net periodic cost (benefit) $ 1.8 $ (0.3 ) $ 4.1 $ 2.6 $ 5.9 $ 2.3 (a) Reclassified into operating expenses from AOCI. |
SUMMARIZED FINANCIAL INFORMATIO
SUMMARIZED FINANCIAL INFORMATION OF ANIXTER INC. | 6 Months Ended |
Jul. 03, 2015 | |
Text Block [Abstract] | |
SUMMARIZED FINANCIAL INFORMATION OF ANIXTER INC. | SUMMARIZED FINANCIAL INFORMATION OF ANIXTER INC. We guarantee, fully and unconditionally, substantially all of the debt of our subsidiaries, which include Anixter Inc., our primary operating subsidiary. We have no independent assets or operations and all subsidiaries other than consolidated Anixter Inc. are minor. The following summarizes the financial information for Anixter Inc.: ANIXTER INC. CONDENSED CONSOLIDATED BALANCE SHEETS July 3, January 2, (In millions) As Adjusted (see Note 2) Assets: Current assets $ 2,332.3 $ 2,210.2 Current assets of discontinued operations 47.6 379.2 Property, equipment and capital leases, net 121.9 114.7 Goodwill 577.3 582.3 Other assets 265.3 282.5 Long-term assets of discontinued operations — 27.7 $ 3,344.4 $ 3,596.6 Liabilities and Stockholder’s Equity: Current liabilities $ 967.2 $ 921.3 Current liabilities of discontinued operations 29.8 108.8 Subordinated notes payable to parent — 1.5 Long-term debt 954.1 1,221.8 Other liabilities 196.5 212.2 Long-term liabilities of discontinued operations 4.5 0.2 Stockholder’s equity 1,192.3 1,130.8 $ 3,344.4 $ 3,596.6 ANIXTER INC. CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME Three Months Ended Six Months Ended July 3, July 4, July 3, July 4, (In millions) As Adjusted (see Note 2) As Adjusted (see Note 2) Net sales $ 1,480.4 $ 1,342.9 $ 2,865.5 $ 2,617.2 Operating income $ 65.9 $ 78.7 $ 126.7 $ 150.0 Income from continuing operations before income taxes $ 49.3 $ 67.4 $ 91.7 $ 118.7 Net income from discontinued operations $ 41.9 $ 9.3 $ 34.5 $ 19.0 Net income $ 72.2 $ 54.5 $ 92.2 $ 102.7 Comprehensive income $ 78.8 $ 69.3 $ 58.6 $ 110.9 |
STOCKHOLDERS' EQUITY
STOCKHOLDERS' EQUITY | 6 Months Ended |
Jul. 03, 2015 | |
Equity [Abstract] | |
STOCKHOLDERS' EQUITY | STOCKHOLDERS' EQUITY At the end of the second quarter of 2015 , there were 1.7 million shares reserved for issuance under all incentive plans. Under the current stock incentive plans, we pay non-employee directors annual retainer fees and, at their election, meeting fees in the form of stock units. Employee and director stock units are included in common stock outstanding on the date of vesting, and stock options are included in common stock outstanding upon exercise by the participant. The fair value of employee stock options and units is amortized over the respective vesting period representing the requisite service period, generally three to four years for stock units and four years for stock options. Director stock units are expensed in the period in which they are granted, as these vest immediately. During the three and six months ended July 3, 2015 , we granted 3,089 and 181,665 stock units to employees, respectively, with a weighted-average grant-date fair value of $0.2 million and $14.3 million , respectively. During the three and six months ended July 3, 2015 , we granted directors 7,312 and 14,057 stock units, respectively, with a weighted-average grant-date fair value of $0.5 million and $1.0 million , respectively. We exclude antidilutive stock options and units from the calculation of weighted-average shares for diluted earnings per share. For the second quarter of 2015 and 2014 , the antidilutive stock options and units were immaterial. |
LEGAL CONTINGENCIES
LEGAL CONTINGENCIES | 6 Months Ended |
Jul. 03, 2015 | |
Commitments and Contingencies Disclosure [Abstract] | |
LEGAL CONTINGENCIES | LEGAL CONTINGENCIES From time to time, we are party to legal proceedings and matters that arise in the ordinary course of business. As of July 3, 2015 , we do not believe there is a reasonable possibility that any material loss exceeding the amounts already recognized for these proceedings and matters has been incurred. However, the ultimate resolutions of these proceedings and matters are inherently unpredictable. As such, our financial condition and results of operations could be adversely affected in any particular period by the unfavorable resolution of one or more of these proceedings or matters. |
BUSINESS SEGMENTS
BUSINESS SEGMENTS | 6 Months Ended |
Jul. 03, 2015 | |
Segment Reporting [Abstract] | |
BUSINESS SEGMENTS | BUSINESS SEGMENTS We are a leading distributor of enterprise cabling and security solutions and electrical and electronic wire and cable products. We have identified Enterprise Cabling and Security Solutions ("ECS") and Electrical and Electronic Wire and Cable ("W&C") as reportable segments. As discussed in Note 2. "Discontinued Operations" , beginning in the second quarter of 2015, the Fasteners segment has been classified as "Discontinued Operations" for all periods. We incur corporate expenses to obtain and coordinate financing, tax, information technology, legal and other related services, certain of which are billed to subsidiaries. These corporate expenses are allocated to the segments based primarily on projected sales and estimated use of time. A portion of these corporate expenses are reported in the corporate segment as they historically had been allocated to the Fasteners segment but are not considered directly related to the discontinued operations. Also, we have various corporate assets which are not allocated to the segments. Segment assets may not include jointly used assets or unallocated assets, but segment results include depreciation expense or other allocations related to those assets as such allocation is made for internal reporting. Interest expense and other non-operating items are not allocated to the segments or reviewed on a segment basis. Intercompany transactions are not significant. Segment Financial Information Segment information for the three and six months ended July 3, 2015 and July 4, 2014 are as follows: (In millions) Second Quarter of 2015 ECS W&C Corporate Total Net sales $ 1,001.6 $ 478.8 $ — $ 1,480.4 Operating income $ 42.2 $ 25.0 $ (2.7 ) $ 64.5 Second Quarter of 2014 (As Adjusted, see Note 2) ECS W&C Corporate Total Net sales $ 834.0 $ 508.9 $ — $ 1,342.9 Operating income $ 45.5 $ 34.7 $ (3.0 ) $ 77.2 Six Months of 2015 ECS W&C Corporate Total Net sales $ 1,917.4 $ 948.1 $ — $ 2,865.5 Operating income $ 78.5 $ 51.2 $ (5.9 ) $ 123.8 Six Months of 2014 (As Adjusted, see Note 2) ECS W&C Corporate Total Net sales $ 1,610.8 $ 1,006.4 $ — $ 2,617.2 Operating income $ 83.1 $ 70.0 $ (5.9 ) $ 147.2 Goodwill Assigned to Segments The following table presents the changes in goodwill allocated to our reportable segments during the six months ended July 3, 2015 : (In millions) ECS W&C Total Balance at January 2, 2015 $ 403.4 $ 178.9 $ 582.3 Acquisition related (a) 0.1 — 0.1 Foreign currency translation (4.3 ) (0.8 ) (5.1 ) Balance at July 3, 2015 $ 399.2 $ 178.1 $ 577.3 (a) In the second quarter of 2015, we recorded an immaterial increase in goodwill related to the purchase price allocation for the acquisition of Tri-Ed. |
SUBSEQUENT EVENTS SUBSEQUENT EV
SUBSEQUENT EVENTS SUBSEQUENT EVENTS (Notes) | 6 Months Ended |
Jul. 03, 2015 | |
Subsequent Events [Abstract] | |
SUBSEQUENT EVENTS | SUBSEQUENT EVENT On July 15, 2015, the Company, through its wholly-owned subsidiary Anixter Inc., entered into a Purchase Agreement with HD Supply, Inc., HD Supply Holdings, LLC, HD Supply GP & Management, Inc., HD Supply Power Solutions Group, Inc., and Brafasco Holdings II, Inc. (collectively the "Sellers"). Pursuant to the Purchase Agreement, the Company has agreed to purchase all of the outstanding equity of HD Supply Power Solutions, Ltd., HDS Power Solutions, Inc. and Pro Canadian Holdings I, ULC from Sellers, together with assets owned by Sellers and their affiliates that are primarily used in Sellers' power solutions business (the "Transaction"), in exchange for the payment of $825.0 million in cash, subject to certain post-closing working capital and other adjustments. The closing of the Transaction, which the Company expects will occur near the end of the third quarter of this year, is subject to various conditions, including regulatory and antitrust approvals, receipt of certain third party consents and approvals and other customary closing conditions. |
SUMMARY OF SIGNIFICANT ACCOUN20
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 6 Months Ended |
Jul. 03, 2015 | |
Accounting Policies [Abstract] | |
Basis of presentation | Basis of presentation: Anixter International Inc. and its subsidiaries (collectively referred to as "Anixter" or the "Company") are sometimes referred to in this Quarterly Report on Form 10-Q as "we", "our", "us", or "ourselves." The condensed consolidated financial information furnished herein reflects all adjustments (consisting of normal recurring accruals), which are, in the opinion of management, necessary for a fair presentation of the Condensed Consolidated Financial Statements for the periods shown. Certain prior period amounts have been reclassified to conform to the current year presentation. The results of operations of any interim period are not necessarily indicative of the results that may be expected for a full fiscal year. |
Recently issued and adopted accounting pronouncements | Recently issued and adopted accounting pronouncements: In April 2014, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") No. 2014-8 Reporting Discontinued Operations and Disclosures of Disposals of Components of an Entity. This update changes the criteria for determining which disposals can be presented as discontinued operations and modifies related disclosure requirements. Under the new guidance, a discontinued operation is defined as a disposal of a component or group of components that is disposed of or is classified as held for sale and represents a strategic shift that has a major effect on an entity's operations and financial results. The guidance is effective for entities with annual periods beginning on or after December 15, 2014. This accounting guidance applies prospectively to new disposals and new classifications of disposal groups held for sale. We adopted this guidance in the first quarter of fiscal year 2015. See Note 2. "Discontinued Operations" for applicable disclosures. |
Description of New Accounting Pronouncements Not yet Adopted | Recently issued accounting pronouncements not yet adopted: On April 15, 2015, the FASB issued ASU 2015-04, Practical Expedient for the Measurement Date of an Employer's Defined Benefit Obligation and Plan Assets , which permits a reporting entity with a fiscal year-end that does not coincide with a month-end to measure defined benefit plan assets and obligations using the month-end that is closest to the entity's fiscal year-end and apply that practical expedient consistently from year to year. The standard is effective for our financial statements issued for fiscal years beginning after December 15, 2016, and interim periods within those fiscal years. Early adoption is permitted. The new guidance should be applied on a prospective basis. The adoption of this standard is not expected to have a material impact on our consolidated financial statements. On April 7, 2015, the FASB issued ASU 2015-03, Simplifying the Presentation of Debt Issuance Costs , which requires debt issuance costs to be presented in the balance sheet as a direct deduction from the associated debt liability. The standard is effective for our financial statements issued for fiscal years beginning after December 15, 2015, and interim periods within those fiscal years. Early adoption is permitted for financial statements that have not been previously issued. The new guidance will be applied on a retrospective basis. The adoption of this standard is not expected to have a material impact on our consolidated financial statements. In May 2014, the FASB issued ASU 2014-09, Revenue from Contracts with Customers , which provides guidance for revenue recognition. The update’s core principle is that a company will recognize revenue when it transfers promised goods or services to customers in an amount that reflects the consideration to which the company expects to be entitled in exchange for those goods or services. In doing so, companies will need to use more judgment and make more estimates than under current guidance. Examples of the use of judgments and estimates may include identifying performance obligations in the contract, estimating the amount of variable consideration to include in the transaction price and allocating the transaction price to each separate performance obligation. The update also requires more detailed disclosures to enable users of financial statements to understand the nature, amount, timing, and uncertainty of revenue and cash flows arising from contracts with customers. The update provides for two transition methods to the new guidance: a retrospective approach and a modified retrospective approach. The guidance is effective for fiscal years, and interim periods within those years, beginning after December 15, 2017. Early adoption is permitted as of the original effective date. We are currently in the process of evaluating the transition methods and the impact of adoption of this ASU on our consolidated financial statements. We do not believe that any other recently issued, but not yet effective, accounting pronouncements, if adopted, would have a material impact on our consolidated financial statements or disclosures. |
Other, net | Other, net: The following represents the components of "Other, net" as reflected in the Condensed Consolidated Statements of Comprehensive Income : Three Months Ended Six Months Ended July 3, July 4, July 3, July 4, (In millions) As Adjusted (see Note 2) As Adjusted (see Note 2) Other, net: Foreign exchange $ (2.4 ) $ (1.0 ) $ (6.0 ) $ (2.4 ) Foreign exchange devaluations — — (0.7 ) (8.0 ) Cash surrender value of life insurance policies (0.6 ) 0.5 — 0.8 Other (0.5 ) (1.4 ) (0.8 ) (2.0 ) Total other, net $ (3.5 ) $ (1.9 ) $ (7.5 ) $ (11.6 ) In the first quarter of 2014, the Venezuelan government changed its policy regarding the bolivar, which required us to use the Complementary System for the Administration of Foreign Currency ("SICAD") rate of 49.0 bolivars to one U.S. Dollar ("USD") to repatriate cash from Venezuela. In the first quarter of 2014, the Argentine peso was also devalued from 6.5 pesos to one USD to approximately 8.0 pesos to one USD after the central bank scaled back its intervention in a bid to preserve USD cash reserves. As a result of these devaluations, we recorded foreign exchange losses in these two countries of $8.0 million in the first quarter of 2014. In the first quarter of 2015, the Venezuelan government changed its policy regarding the bolivar, which we believe will now require us to use the Sistema Marginal de Divisas or Marginal Exchange System ("SIMADI") a "completely free floating" rate. As a result, we believe that the current rate of approximately 197.0 bolivars to one USD will be the rate available to us in the event we repatriate cash from Venezuela. As a result of the devaluation in the first quarter of 2015, we recorded a foreign exchange loss of $0.7 million in the first quarter of 2015. Several of our subsidiaries conduct business in a currency other than the legal entity’s functional currency. Transactions may produce receivables or payables that are fixed in terms of the amount of foreign currency that will be received or paid. A change in exchange rates between the functional currency and the currency in which a transaction is denominated increases or decreases the expected amount of functional currency cash flows upon settlement of the transaction. The increase or decrease in expected functional currency cash flows is a foreign currency transaction gain or loss that is included in "Other, net" in the Condensed Consolidated Statements of Comprehensive Income . We purchase foreign currency forward contracts to minimize the effect of fluctuating foreign currency-denominated accounts on our reported income. The foreign currency forward contracts are not designated as hedges for accounting purposes. Our strategy is to negotiate terms for our derivatives and other financial instruments to be highly effective, such that the change in the value of the derivative perfectly offsets the impact of the underlying hedged item (e.g., various foreign currency-denominated accounts). Our counterparties to foreign currency forward contracts have investment-grade credit ratings. We expect the creditworthiness of our counterparties to remain intact through the term of the transactions. We regularly monitor the creditworthiness of our counterparties to ensure no issues exist which could affect the value of the derivatives. While our derivatives are all subject to master netting arrangements, we present our assets and liabilities related to derivative instruments on a gross basis within the Condensed Consolidated Balance Sheets. The gross amount of our derivative assets and liabilities are immaterial. We do not hedge 100% of our foreign currency-denominated accounts. In addition, the results of hedging can vary significantly based on various factors, such as the timing of executing the foreign currency forward contracts versus the movement of the currencies as well as the fluctuations in the account balances throughout each reporting period. The fair value of the foreign currency forward contracts is based on the difference between the contract rate and the current exchange rate. The fair value of the foreign currency forward contracts is measured using observable market information. These inputs would be considered Level 2 in the fair value hierarchy. At July 3, 2015 and January 2, 2015 , foreign currency forward contracts were revalued at then-current foreign exchange rates with the changes in valuation reflected directly in "Other, net" in the Condensed Consolidated Statements of Comprehensive Income offsetting the transaction gain/loss recorded on the foreign currency-denominated accounts. At July 3, 2015 and January 2, 2015 , the gross notional amount of foreign currency forward contracts outstanding was approximately $238.6 million and $222.9 million , respectively. All of our foreign currency forward contracts are subject to master netting arrangements with our counterparties. As a result, at July 3, 2015 and January 2, 2015 , the net notional amount of the foreign currency forward contracts outstanding was approximately $142.6 million and $121.9 million , respectively. The combined effect of changes in both the equity and bond markets resulted in changes in the cash surrender value of our owned life insurance policies associated with our sponsored deferred compensation program. |
Accumulated Other Comprehensive Income | Accumulated other comprehensive income (loss): We accumulated unrealized gains and losses in "Accumulated other comprehensive income (loss)" ("AOCI") which are also reported in " Other comprehensive income (loss) " on the Condensed Consolidated Statements of Comprehensive Income . These include unrealized gains and losses related to our defined benefit obligations, certain immaterial derivative transactions that have been designated as cash flow hedges and foreign currency translation. See Note 7. "Pension Plans" for pension related amounts reclassified into net income. Our investments in several subsidiaries are recorded in currencies other than the USD. As these foreign currency denominated investments are translated at the end of each period during consolidation using period-end exchange rates, fluctuations of exchange rates between the foreign currency and the USD increase or decrease the value of those investments. These fluctuations and the results of operations for foreign subsidiaries, where the functional currency is not the USD, are translated into USD using the average exchange rates during the periods reported, while the assets and liabilities are translated using period-end exchange rates. The assets and liabilities-related translation adjustments are recorded as a separate component of AOCI, "Foreign currency translation." In addition, as our subsidiaries maintain investments denominated in currencies other than local currencies, exchange rate fluctuations will occur. Borrowings are raised in certain foreign currencies to minimize the exchange rate translation adjustment risk. |
SUMMARY OF SIGNIFICANT ACCOUN21
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables) | 6 Months Ended |
Jul. 03, 2015 | |
Summary of Components of Other Net Reflected in Consolidated Statements of Comprehensive Income [Abstract] | |
Schedule of Other Nonoperating Income, by Component | The following represents the components of "Other, net" as reflected in the Condensed Consolidated Statements of Comprehensive Income : Three Months Ended Six Months Ended July 3, July 4, July 3, July 4, (In millions) As Adjusted (see Note 2) As Adjusted (see Note 2) Other, net: Foreign exchange $ (2.4 ) $ (1.0 ) $ (6.0 ) $ (2.4 ) Foreign exchange devaluations — — (0.7 ) (8.0 ) Cash surrender value of life insurance policies (0.6 ) 0.5 — 0.8 Other (0.5 ) (1.4 ) (0.8 ) (2.0 ) Total other, net $ (3.5 ) $ (1.9 ) $ (7.5 ) $ (11.6 ) |
DISCONTINUED OPERATIONS (Tables
DISCONTINUED OPERATIONS (Tables) | 6 Months Ended |
Jul. 03, 2015 | |
Discontinued Operations and Disposal Groups [Abstract] | |
Disposal Groups, Including Discontinued Operations, Income Statement [Table Text Block] | The following represents the components of the results from discontinued operations as reflected in our Condensed Consolidated Statements of Comprehensive Income : Three Months Ended Six Months Ended (In millions) July 3, July 4, July 3, July 4, Net sales $ 148.4 $ 243.1 $ 397.8 $ 492.6 Operating income $ 5.2 $ 15.1 $ 17.1 $ 30.8 Income from discontinued operations before income taxes $ 4.2 $ 13.4 $ 15.4 $ 27.4 Gain on sale of discontinued operations $ 42.3 $ — $ 42.3 $ — Income tax expense from discontinued operations $ 4.6 $ 4.1 $ 23.2 $ 8.4 Net income from discontinued operations $ 41.9 $ 9.3 $ 34.5 $ 19.0 |
Disposal Group, Including Discontinued operations, Balance Sheet [Table Text Block] | As reflected on our Condensed Consolidated Balance Sheets as of July 3, 2015 and January 2, 2015 , the components of assets and liabilities of the Fasteners businesses classified as "Discontinued Operations" are as follows: (In millions) July 3, January 2, Assets of discontinued operations: Accounts receivable $ 32.9 $ 158.2 Inventories 8.9 213.8 Net property and equipment — 16.8 Other assets 5.8 18.1 Total assets of discontinued operations $ 47.6 $ 406.9 Liabilities of discontinued operations: Accounts payable $ 10.7 $ 92.8 Accrued expenses 18.9 16.0 Other liabilities 4.7 0.2 Total liabilities of discontinued operations $ 34.3 $ 109.0 |
BUSINESS COMBINATION (Tables)
BUSINESS COMBINATION (Tables) | 6 Months Ended |
Jul. 03, 2015 | |
Business Combinations [Abstract] | |
Purchase price allocation | The following table sets forth the preliminary purchase price allocation, as of the acquisition date, for Tri-Ed. The purchase price allocation is preliminary pending finalization of the valuation of the acquired intangible assets and related deferred tax liabilities, which is expected to be completed in 2015. (In millions) Cash $ 11.6 Current assets, net 203.9 Property and equipment 2.7 Goodwill 243.5 Intangible assets 166.8 Current liabilities (144.6 ) Non-current liabilities (56.1 ) Total purchase price $ 427.8 |
Intangible assets acquired | The following table sets forth the components of preliminary identifiable intangible assets acquired and their estimated useful lives as of the date of the acquisition: (In millions) Average useful life (in years) Fair value Customer relationships 11-18 $ 120.6 Exclusive supplier agreement 21 23.2 Trade names Indefinite 10.6 Tri-Ed trade names 4 9.2 Non-compete agreements 4-5 3.2 Total intangible assets $ 166.8 |
Acquisition pro forma information | The following unaudited pro forma information shows our results of operations as if the acquisition of Tri-Ed had been completed as of the beginning of fiscal 2014. Adjustments have been made for the pro forma effects of interest expense and deferred financing costs related to the financing of the business combination, depreciation and amortization of tangible and intangible assets recognized as part of the business combination, related income taxes and various other costs which would not have been incurred had we and Tri-Ed operated as a combined entity (i.e., management fees paid by Tri-Ed to its former owners). Three Months Ended Six Months Ended (In millions, except per share amounts) July 4, July 4, Net sales $ 1,491.9 $ 2,908.0 Net income from continuing operations $ 45.8 $ 83.7 Income per share from continuing operations: Basic $ 1.39 $ 2.54 Diluted $ 1.37 $ 2.51 |
DEBT (Tables)
DEBT (Tables) | 6 Months Ended |
Jul. 03, 2015 | |
Debt Disclosure [Abstract] | |
Debt | Debt is summarized below: (In millions) July 3, January 2, Long-term debt: Senior notes due 2021 $ 394.5 $ 394.2 Senior notes due 2019 346.3 345.9 Term loan 196.3 198.8 Accounts receivable securitization facility — 65.0 Revolving lines of credit — — Senior notes due 2015 — 200.0 Other 3.6 3.8 Total long-term debt $ 940.7 $ 1,207.7 |
PENSION PLANS (Tables)
PENSION PLANS (Tables) | 6 Months Ended |
Jul. 03, 2015 | |
Compensation and Retirement Disclosure [Abstract] | |
Components of Net Periodic Cost | Components of net periodic pension cost (benefit) are as follows: Three Months Ended Domestic Foreign Total (In millions) July 3, July 4, July 3, July 4, July 3, July 4, Service cost $ 1.7 $ 1.2 $ 1.6 $ 1.5 $ 3.3 $ 2.7 Interest cost 4.1 2.7 2.3 2.7 6.4 5.4 Expected return on plan assets (5.3 ) (3.4 ) (2.7 ) (3.2 ) (8.0 ) (6.6 ) Net amortization (a) 0.5 (0.5 ) 0.8 0.3 1.3 (0.2 ) Net periodic cost $ 1.0 $ — $ 2.0 $ 1.3 $ 3.0 $ 1.3 Six Months Ended Domestic Foreign Total (In millions) July 3, July 4, July 3, July 4, July 3, July 4, Service cost $ 3.0 $ 2.4 $ 3.3 $ 3.0 $ 6.3 $ 5.4 Interest cost 6.7 5.3 4.6 5.4 11.3 10.7 Expected return on plan assets (8.8 ) (6.9 ) (5.3 ) (6.4 ) (14.1 ) (13.3 ) Net amortization (a) 0.9 (1.1 ) 1.5 0.6 2.4 (0.5 ) Net periodic cost (benefit) $ 1.8 $ (0.3 ) $ 4.1 $ 2.6 $ 5.9 $ 2.3 (a) Reclassified into operating expenses from AOCI. |
SUMMARIZED FINANCIAL INFORMAT26
SUMMARIZED FINANCIAL INFORMATION OF ANIXTER INC. (Tables) | 6 Months Ended |
Jul. 03, 2015 | |
Text Block [Abstract] | |
CONDENSED CONSOLIDATED BALANCE SHEETS | ANIXTER INC. CONDENSED CONSOLIDATED BALANCE SHEETS July 3, January 2, (In millions) As Adjusted (see Note 2) Assets: Current assets $ 2,332.3 $ 2,210.2 Current assets of discontinued operations 47.6 379.2 Property, equipment and capital leases, net 121.9 114.7 Goodwill 577.3 582.3 Other assets 265.3 282.5 Long-term assets of discontinued operations — 27.7 $ 3,344.4 $ 3,596.6 Liabilities and Stockholder’s Equity: Current liabilities $ 967.2 $ 921.3 Current liabilities of discontinued operations 29.8 108.8 Subordinated notes payable to parent — 1.5 Long-term debt 954.1 1,221.8 Other liabilities 196.5 212.2 Long-term liabilities of discontinued operations 4.5 0.2 Stockholder’s equity 1,192.3 1,130.8 $ 3,344.4 $ 3,596.6 |
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME | ANIXTER INC. CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME Three Months Ended Six Months Ended July 3, July 4, July 3, July 4, (In millions) As Adjusted (see Note 2) As Adjusted (see Note 2) Net sales $ 1,480.4 $ 1,342.9 $ 2,865.5 $ 2,617.2 Operating income $ 65.9 $ 78.7 $ 126.7 $ 150.0 Income from continuing operations before income taxes $ 49.3 $ 67.4 $ 91.7 $ 118.7 Net income from discontinued operations $ 41.9 $ 9.3 $ 34.5 $ 19.0 Net income $ 72.2 $ 54.5 $ 92.2 $ 102.7 Comprehensive income $ 78.8 $ 69.3 $ 58.6 $ 110.9 |
BUSINESS SEGMENTS (Tables)
BUSINESS SEGMENTS (Tables) | 6 Months Ended |
Jul. 03, 2015 | |
Segment Reporting [Abstract] | |
Segment Information | Segment information for the three and six months ended July 3, 2015 and July 4, 2014 are as follows: (In millions) Second Quarter of 2015 ECS W&C Corporate Total Net sales $ 1,001.6 $ 478.8 $ — $ 1,480.4 Operating income $ 42.2 $ 25.0 $ (2.7 ) $ 64.5 Second Quarter of 2014 (As Adjusted, see Note 2) ECS W&C Corporate Total Net sales $ 834.0 $ 508.9 $ — $ 1,342.9 Operating income $ 45.5 $ 34.7 $ (3.0 ) $ 77.2 Six Months of 2015 ECS W&C Corporate Total Net sales $ 1,917.4 $ 948.1 $ — $ 2,865.5 Operating income $ 78.5 $ 51.2 $ (5.9 ) $ 123.8 Six Months of 2014 (As Adjusted, see Note 2) ECS W&C Corporate Total Net sales $ 1,610.8 $ 1,006.4 $ — $ 2,617.2 Operating income $ 83.1 $ 70.0 $ (5.9 ) $ 147.2 |
Changes in Goodwill | The following table presents the changes in goodwill allocated to our reportable segments during the six months ended July 3, 2015 : (In millions) ECS W&C Total Balance at January 2, 2015 $ 403.4 $ 178.9 $ 582.3 Acquisition related (a) 0.1 — 0.1 Foreign currency translation (4.3 ) (0.8 ) (5.1 ) Balance at July 3, 2015 $ 399.2 $ 178.1 $ 577.3 (a) In the second quarter of 2015, we recorded an immaterial increase in goodwill related to the purchase price allocation for the acquisition of Tri-Ed. |
SUMMARY OF SIGNIFICANT ACCOUN28
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Summary of Components of Other Net Reflected in Consolidated Statements of Comprehensive Income (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jul. 03, 2015 | Jul. 04, 2014 | Jul. 03, 2015 | Jul. 04, 2014 | |
Summary of Components of Other Net Reflected in Consolidated Statements of Comprehensive Income [Abstract] | ||||
Foreign exchange | $ (2.4) | $ (1) | $ (6) | $ (2.4) |
Foreign exchange devaluations | 0 | 0 | (0.7) | (8) |
Cash surrender value of life insurance policies | (0.6) | 0.5 | 0 | 0.8 |
Other | (0.5) | (1.4) | (0.8) | (2) |
Total other, net | $ (3.5) | $ (1.9) | $ (7.5) | $ (11.6) |
SUMMARY OF SIGNIFICANT ACCOUN29
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Additional Information (Detail) $ in Millions | 3 Months Ended | 6 Months Ended | |||||
Jul. 03, 2015USD ($) | Jul. 04, 2014USD ($) | Jul. 03, 2015USD ($) | Jul. 04, 2014USD ($) | Jan. 02, 2015USD ($) | Apr. 04, 2014 | Jan. 03, 2014 | |
Derivative Instruments and Hedging Activities Disclosures [Line Items] | |||||||
Foreign exchange losses due to devaluation | $ 0 | $ 0 | $ 0.7 | $ 8 | |||
Rate of foreign currency denominated accounts not hedged | 100.00% | ||||||
Gross [Member] | |||||||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | |||||||
Derivative, Notional Amount | 238.6 | $ 238.6 | $ 222.9 | ||||
Net [Member] | |||||||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | |||||||
Derivative, Notional Amount | $ 142.6 | $ 142.6 | $ 121.9 | ||||
Venezuelan bolívar fuerte | |||||||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | |||||||
Foreign currency exchange rate | 197 | 197 | 49 | ||||
Argentina, Pesos | |||||||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | |||||||
Foreign currency exchange rate | 8 | 6.5 |
DISCONTINUED OPERATIONS (Detail
DISCONTINUED OPERATIONS (Detail) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jul. 03, 2015 | Jul. 04, 2014 | Jul. 03, 2015 | Jul. 04, 2014 | |
Discontinued Operations Additional Detail [Line Items] | ||||
Consideration for Discontinued Operations | $ 380 | $ 380 | ||
Discontinued Operations, Amount of Contingent Purchase Price | 10 | 10 | ||
Proceeds from sale of business | 358 | $ 0 | ||
Other Receivables | 14.9 | 14.9 | ||
Transaction related costs | 17 | 17 | ||
Discontinued Operation, Gain (Loss) from Disposal of Discontinued Operation, before Income Tax | 42.3 | $ 0 | 42.3 | 0 |
Discontinued Operation, Gain (Loss) on Disposal of Discontinued Operation, Net of Tax | 32.3 | |||
Interest Expense Allocated to Discontinued Operation | 0.6 | $ 1 | 1.1 | $ 2.1 |
Defined Benefit Plan, Curtailments | $ 5.1 | $ 5.1 |
DISCONTINUED OPERATIONS - State
DISCONTINUED OPERATIONS - Statement of operating income (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jul. 03, 2015 | Jul. 04, 2014 | Jul. 03, 2015 | Jul. 04, 2014 | |
Discontinued Operations Income Statement [Line Items] | ||||
Net sales | $ 148.4 | $ 243.1 | $ 397.8 | $ 492.6 |
Operating income | 5.2 | 15.1 | 17.1 | 30.8 |
Income from discontinued operations before income taxes (excluding gain) | 4.2 | 13.4 | 15.4 | 27.4 |
Discontinued Operation, Gain (Loss) from Disposal of Discontinued Operation, before Income Tax | 42.3 | 0 | 42.3 | 0 |
Income tax expense from discontinued operations | 4.6 | 4.1 | 23.2 | 8.4 |
Net income from discontinued operations | $ 41.9 | $ 9.3 | $ 34.5 | $ 19 |
DISCONTINUED OPERATIONS - Balan
DISCONTINUED OPERATIONS - Balance sheet (Details) - USD ($) $ in Millions | Jul. 03, 2015 | Jan. 02, 2015 |
Discontinued Operations Balance Sheet [Line Items] | ||
Accounts receivable | $ 32.9 | $ 158.2 |
Inventories | 8.9 | 213.8 |
Net property and equipment | 0 | 16.8 |
Other assets | 5.8 | 18.1 |
Total assets of discontinued operations | 47.6 | 406.9 |
Accounts payable | 10.7 | 92.8 |
Accrued expenses | 18.9 | 16 |
Other liabilities | 4.7 | 0.2 |
Total liabilities of discontinued operations | $ 34.3 | $ 109 |
BUSINESS COMBINATION - Business
BUSINESS COMBINATION - Business Combination (Detail) - Jan. 02, 2015 - USD ($) $ in Millions | Total |
Business Acquisition [Line Items] | |
Cash | $ 11.6 |
Current assets, net | 203.9 |
Property and equipment | 2.7 |
Goodwill | 243.5 |
Intangible assets | 166.8 |
Current liabilities | (144.6) |
Non-current liabilities | (56.1) |
Total purchase price | $ 427.8 |
BUSINESS COMBINATION, Intangibl
BUSINESS COMBINATION, Intangible assets acquired (Details) - Jan. 02, 2015 - USD ($) $ in Millions | Total |
ScheduleOfAcquiredFiniteAndIndefiniteLivedIntangibleAssetsByMajorClass [Line Items] | |
Indefinite-lived Intangible Assets | $ 10.6 |
Intangible assets | $ 166.8 |
Customer Relationships [Member] | |
ScheduleOfAcquiredFiniteAndIndefiniteLivedIntangibleAssetsByMajorClass [Line Items] | |
Acquired Finite-lived Intangible Assets, Weighted Average Useful Life | 18 years |
Exclusive supplier agreement [Member] | |
ScheduleOfAcquiredFiniteAndIndefiniteLivedIntangibleAssetsByMajorClass [Line Items] | |
Acquired Finite-lived Intangible Assets, Weighted Average Useful Life | 21 years |
Tri-Ed trade name [Member] | |
ScheduleOfAcquiredFiniteAndIndefiniteLivedIntangibleAssetsByMajorClass [Line Items] | |
Acquired Finite-lived Intangible Assets, Weighted Average Useful Life | 4 years |
Noncompete Agreements [Member] | |
ScheduleOfAcquiredFiniteAndIndefiniteLivedIntangibleAssetsByMajorClass [Line Items] | |
Acquired Finite-lived Intangible Assets, Weighted Average Useful Life | 5 years |
Customer Relationships [Member] | |
ScheduleOfAcquiredFiniteAndIndefiniteLivedIntangibleAssetsByMajorClass [Line Items] | |
Acquired Finite-lived Intangible Assets, Weighted Average Useful Life | 11 years |
Noncompete Agreements [Member] | |
ScheduleOfAcquiredFiniteAndIndefiniteLivedIntangibleAssetsByMajorClass [Line Items] | |
Acquired Finite-lived Intangible Assets, Weighted Average Useful Life | 4 years |
Customer Relationships [Member] | |
ScheduleOfAcquiredFiniteAndIndefiniteLivedIntangibleAssetsByMajorClass [Line Items] | |
Finite-lived Intangible Assets | $ 120.6 |
Exclusive supplier agreement [Member] | |
ScheduleOfAcquiredFiniteAndIndefiniteLivedIntangibleAssetsByMajorClass [Line Items] | |
Finite-lived Intangible Assets | 23.2 |
Tri-Ed trade name [Member] | |
ScheduleOfAcquiredFiniteAndIndefiniteLivedIntangibleAssetsByMajorClass [Line Items] | |
Finite-lived Intangible Assets | 9.2 |
Noncompete Agreements [Member] | |
ScheduleOfAcquiredFiniteAndIndefiniteLivedIntangibleAssetsByMajorClass [Line Items] | |
Finite-lived Intangible Assets | $ 3.2 |
BUSINESS AQUISITION, PRO FORMA
BUSINESS AQUISITION, PRO FORMA (Details) - Jul. 04, 2014 - USD ($) $ / shares in Units, $ in Millions | Total | Total |
Business Acquisition, Pro Forma Information, Nonrecurring Adjustment [Line Items] | ||
Net sales | $ 1,491.9 | $ 2,908 |
Net income from continuing operations | $ 45.8 | $ 83.7 |
Basic net income from continuing operations per share | $ 1.39 | $ 2.54 |
Diluted net income from continuing operations per share | $ 1.37 | $ 2.51 |
Business Combination - Addition
Business Combination - Additional information (Details) - USD ($) $ in Millions | 6 Months Ended | 12 Months Ended |
Jul. 03, 2015 | Jan. 02, 2015 | |
Business Acquisition [Line Items] | ||
Business Acquisition, Percentage of Voting Interests Acquired | 100.00% | |
Payments to Acquire Businesses, Net of Cash Acquired | $ 418.5 | |
Cash | 11.6 | |
Favorable net asset adjustment | 2.3 | |
Business Acquisition, Goodwill, Expected Tax Deductible Amount | 12.2 | |
Business Combination, Pro Forma Information, Revenue of Acquiree since Acquisition Date, Actual | $ 304 | |
Business Combination, Pro Forma Information, Earnings or Loss of Acquiree since Acquisition Date, Actual | $ 12 | |
Term loan | ||
Business Acquisition [Line Items] | ||
Long-term Debt, Gross | 200 | |
Senior notes due 2021 | ||
Business Acquisition [Line Items] | ||
Long-term Debt, Gross | $ 400 |
RESTRUCTURING AND OTHER CHARG37
RESTRUCTURING AND OTHER CHARGES RESTRUCTURING AND OTHER CHARGES (Details) - Jul. 03, 2015 $ in Millions | USD ($) |
Restructuring Cost and Other Charges [Line Items] | |
Restructuring, number of positions eliminated | 100 |
Accrued restructuring balance, current | $ 4.7 |
Capitalized software write-off | 3.1 |
Bad debt expense, Venezuelan customer | 2.6 |
Dilapidation provision on leasehold properties | 1.7 |
Acquisition and integration costs | 1 |
Pension divestiture costs | 0.4 |
Employee Severance [Member] | |
Restructuring Cost and Other Charges [Line Items] | |
Restructuring charge | 5.3 |
Employee Severance [Member] | Enterprise Cabling And Security [Member] | |
Restructuring Cost and Other Charges [Line Items] | |
Restructuring charge | 3.1 |
Employee Severance [Member] | Wire And Cable [Member] | |
Restructuring Cost and Other Charges [Line Items] | |
Restructuring charge | $ 2.2 |
INCOME TAXES - Additional infor
INCOME TAXES - Additional information (Detail) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jul. 03, 2015 | Jul. 04, 2014 | Jul. 03, 2015 | Jul. 04, 2014 | |
Income Tax Disclosure [Abstract] | ||||
Effective income tax rate | 38.80% | 32.90% | 37.30% | 29.40% |
Income Loss From Continuing Operations Tax Benefit Related To Reversal Of Valuation Allowance | $ 2 | $ 6.9 | ||
Taxes Resulting From Repatriation of Foreign Earnings | $ 4.9 | $ 10.3 |
DEBT- Debt (Detail)
DEBT- Debt (Detail) - USD ($) $ in Millions | Jul. 03, 2015 | Jan. 02, 2015 |
Debt Instrument | ||
Long-term debt | $ 940.7 | $ 1,207.7 |
Senior notes due 2021 | ||
Debt Instrument | ||
Long-term debt | 394.5 | 394.2 |
Senior notes due 2019 | ||
Debt Instrument | ||
Long-term debt | 346.3 | 345.9 |
Term loan | ||
Debt Instrument | ||
Long-term debt | 196.3 | 198.8 |
Accounts receivable securitization facility | ||
Debt Instrument | ||
Long-term debt | 0 | 65 |
Revolving lines of credit | ||
Debt Instrument | ||
Long-term debt | 0 | 0 |
Senior notes due 2015 | ||
Debt Instrument | ||
Long-term debt | 0 | 200 |
Other | ||
Debt Instrument | ||
Long-term debt | $ 3.6 | $ 3.8 |
DEBT - Additional Information (
DEBT - Additional Information (Detail) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | |||||
Jul. 03, 2015 | Apr. 03, 2015 | Jul. 04, 2014 | Jul. 03, 2015 | Jul. 04, 2014 | Jan. 02, 2015 | Apr. 04, 2014 | |
Debt Instrument | |||||||
Long-term debt | $ 940.7 | $ 940.7 | $ 1,207.7 | ||||
Long-term debt, fair value | $ 979.6 | $ 979.6 | 1,243.8 | ||||
Weighted average cost of borrowings | 4.70% | 4.60% | 4.60% | 4.70% | |||
Receivables Sold | $ 405.9 | $ 405.9 | 548.5 | ||||
Line of credit facility maximum borrowing capacity | 300 | 300 | |||||
Senior notes due 2015 | |||||||
Debt Instrument | |||||||
Long-term debt | $ 0 | 0 | $ 200 | ||||
Long-term Debt, Percentage Bearing Fixed Interest, Percentage Rate | 5.95% | ||||||
Retirement of Debt | $ 200 | 200 | $ 0 | ||||
Senior notes due 2014 | |||||||
Debt Instrument | |||||||
Long-term Debt, Percentage Bearing Fixed Interest, Percentage Rate | 10.00% | ||||||
Retirement of Debt | $ 32.3 | $ 0 | $ 32.3 |
PENSION PLANS - Additional Info
PENSION PLANS - Additional Information (Detail) | 6 Months Ended |
Jul. 03, 2015 | |
Compensation and Retirement Disclosure [Abstract] | |
General discussion of pension and other postretirement benefits | We have various defined benefit and defined contribution pension plans. Our defined benefit pension plans are the plans in the United States, which consist of the Anixter Inc. Pension Plan, the Executive Benefit Plan and the Supplemental Executive Retirement Plan ("SERP") (together the "Domestic Plans") and various defined benefit pension plans covering employees of foreign subsidiaries in Canada and Europe (together the "Foreign Plans"). The majority of our defined benefit pension plans are non-contributory and cover substantially all full-time domestic employees and certain employees in other countries. Retirement benefits are provided based on compensation as defined in both the Domestic Plans and the Foreign Plans. Our policy is to fund all Domestic Plans as required by the Employee Retirement Income Security Act of 1974 ("ERISA") and the Internal Revenue Service ("IRS") and all Foreign Plans as required by applicable foreign laws. The Executive Benefit Plan and SERP are the only two plans that are unfunded. Assets in the various plans consist primarily of equity securities and fixed income investments. |
PENSION PLANS - Components of N
PENSION PLANS - Components of Net Periodic Cost (Detail) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | |||
Jul. 03, 2015 | Jul. 04, 2014 | Jul. 03, 2015 | Jul. 04, 2014 | ||
Defined Benefit Plan Disclosure [Line Items] | |||||
Service Cost | $ 3.3 | $ 2.7 | $ 6.3 | $ 5.4 | |
Interest cost | 6.4 | 5.4 | 11.3 | 10.7 | |
Expected return on plan assets | (8) | (6.6) | (14.1) | (13.3) | |
Net amortization | [1] | 1.3 | (0.2) | 2.4 | (0.5) |
Net periodic cost (benefit) | 3 | 1.3 | 5.9 | 2.3 | |
Pension Plans, Domestic [Member] | |||||
Defined Benefit Plan Disclosure [Line Items] | |||||
Service Cost | 1.7 | 1.2 | 3 | 2.4 | |
Interest cost | 4.1 | 2.7 | 6.7 | 5.3 | |
Expected return on plan assets | (5.3) | (3.4) | (8.8) | (6.9) | |
Net amortization | [1] | 0.5 | (0.5) | 0.9 | (1.1) |
Net periodic cost (benefit) | 1 | 0 | 1.8 | (0.3) | |
Pension Plans, Foreign [Member] | |||||
Defined Benefit Plan Disclosure [Line Items] | |||||
Service Cost | 1.6 | 1.5 | 3.3 | 3 | |
Interest cost | 2.3 | 2.7 | 4.6 | 5.4 | |
Expected return on plan assets | (2.7) | (3.2) | (5.3) | (6.4) | |
Net amortization | [1] | 0.8 | 0.3 | 1.5 | 0.6 |
Net periodic cost (benefit) | $ 2 | $ 1.3 | $ 4.1 | $ 2.6 | |
[1] | (a) Reclassified into operating expenses from AOCI. |
SUMMARIZED FINANCIAL INFORMAT43
SUMMARIZED FINANCIAL INFORMATION OF ANIXTER INC. - Additional Information (Detail) | 6 Months Ended |
Jul. 03, 2015 | |
Condensed Financial Information of Parent Company Only Disclosure [Abstract] | |
Description of guarantees given by parent company | We guarantee, fully and unconditionally, substantially all of the debt of our subsidiaries, which include Anixter Inc., our primary operating subsidiary. We have no independent assets or operations and all subsidiaries other than consolidated Anixter Inc. are minor. |
SUMMARIZED FINANCIAL INFORMAT44
SUMMARIZED FINANCIAL INFORMATION OF ANIXTER INC - CONDENSED CONSOLIDATED BALANCE SHEETS (Details) - USD ($) $ in Millions | Jul. 03, 2015 | Jan. 02, 2015 |
Assets: | ||
Current assets | $ 2,380.8 | $ 2,589.8 |
Current assets of discontinued operations | 47.6 | 379.2 |
Property, equipment and capital leases, net | 112 | 104.2 |
Goodwill | 577.3 | 582.3 |
Other assets | 265.3 | 282.5 |
Long-term assets of discontinued operations | 0 | 27.7 |
Total assets | 3,335.4 | 3,586.5 |
Liabilities and Equity: | ||
Current liabilities | 996.4 | 1,030.5 |
Current liabilities of discontinued operations | 29.8 | 108.8 |
Long-term debt | 940.7 | 1,207.7 |
Other liabilities | 198 | 215.1 |
Long-term liabilities of discontinued operations | 4.5 | 0.2 |
Stockholder's equity | 1,195.8 | 1,133 |
Total liabilities and stockholders’ equity | 3,335.4 | 3,586.5 |
Anixter Inc. [Member] | ||
Assets: | ||
Current assets | 2,332.3 | 2,210.2 |
Current assets of discontinued operations | 47.6 | 379.2 |
Property, equipment and capital leases, net | 121.9 | 114.7 |
Goodwill | 577.3 | 582.3 |
Other assets | 265.3 | 282.5 |
Long-term assets of discontinued operations | 0 | 27.7 |
Total assets | 3,344.4 | 3,596.6 |
Liabilities and Equity: | ||
Current liabilities | 967.2 | 921.3 |
Current liabilities of discontinued operations | 29.8 | 108.8 |
Subordinated notes payable to parent | 0 | 1.5 |
Long-term debt | 954.1 | 1,221.8 |
Other liabilities | 196.5 | 212.2 |
Long-term liabilities of discontinued operations | 4.5 | 0.2 |
Stockholder's equity | 1,192.3 | 1,130.8 |
Total liabilities and stockholders’ equity | $ 3,344.4 | $ 3,596.6 |
SUMMARIZED FINANCIAL INFORMAT45
SUMMARIZED FINANCIAL INFORMATION OF ANIXTER INC - CONDENSED CONSOLIDATED STATEMENTS OF INCOME AND COMPREHENSIVE INCOME (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jul. 03, 2015 | Jul. 04, 2014 | Jul. 03, 2015 | Jul. 04, 2014 | |
Condensed Financial Statements, Captions [Line Items] | ||||
Net sales | $ 1,480.4 | $ 1,342.9 | $ 2,865.5 | $ 2,617.2 |
Operating income | 64.5 | 77.2 | 123.8 | 147.2 |
Income from continuing operations before income taxes | 48.3 | 66.3 | 89.4 | 116.5 |
Net income from discontinued operations | 41.9 | 9.3 | 34.5 | 19 |
Net income | 71.4 | 53.8 | 90.5 | 101.2 |
Comprehensive income | 78 | 68.6 | 56.9 | 109.4 |
Anixter Inc. [Member] | ||||
Condensed Financial Statements, Captions [Line Items] | ||||
Net sales | 1,480.4 | 1,342.9 | 2,865.5 | 2,617.2 |
Operating income | 65.9 | 78.7 | 126.7 | 150 |
Income from continuing operations before income taxes | 49.3 | 67.4 | 91.7 | 118.7 |
Net income from discontinued operations | 41.9 | 9.3 | 34.5 | 19 |
Net income | 72.2 | 54.5 | 92.2 | 102.7 |
Comprehensive income | $ 78.8 | $ 69.3 | $ 58.6 | $ 110.9 |
STOCKHOLDERS' EQUITY - Addition
STOCKHOLDERS' EQUITY - Additional Information (Detail) - Jul. 03, 2015 - USD ($) $ in Millions | Total | Total |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Number of shares reserved for issuance under various incentive plans | 1,700,000 | 1,700,000 |
Stock Option [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Vesting period over which fair value is amortized | 4 years | |
Minimum [Member] | Restricted Stock Units (RSUs) [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Vesting period over which fair value is amortized | 3 years | |
Maximum [Member] | Restricted Stock Units (RSUs) [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Vesting period over which fair value is amortized | 4 years | |
Employee Stock Units [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Number of stock units granted | 3,089 | 181,665 |
Weighted-average grant-date fair value | $ 0.2 | $ 14.3 |
Director Stock Units [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Number of stock units granted | 7,312 | 14,057 |
Weighted-average grant-date fair value | $ 0.5 | $ 1 |
BUSINESS SEGMENTS - Segment Inf
BUSINESS SEGMENTS - Segment Information (Detail) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jul. 03, 2015 | Jul. 04, 2014 | Jul. 03, 2015 | Jul. 04, 2014 | |
Segment Reporting Information [Line Items] | ||||
Net sales | $ 1,480.4 | $ 1,342.9 | $ 2,865.5 | $ 2,617.2 |
Operating income | 64.5 | 77.2 | 123.8 | 147.2 |
Enterprise Cabling And Security [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Net sales | 1,001.6 | 834 | 1,917.4 | 1,610.8 |
Operating income | 42.2 | 45.5 | 78.5 | 83.1 |
Wire And Cable [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Net sales | 478.8 | 508.9 | 948.1 | 1,006.4 |
Operating income | 25 | 34.7 | 51.2 | 70 |
Corporate Segment [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Net sales | 0 | 0 | 0 | 0 |
Operating income | $ (2.7) | $ (3) | $ (5.9) | $ (5.9) |
BUSINESS SEGMENTS - Changes in
BUSINESS SEGMENTS - Changes in Goodwill (Detail) $ in Millions | 6 Months Ended | |
Jul. 03, 2015USD ($) | ||
Goodwill [Roll Forward] | ||
Balance at January 2, 2015 | $ 582.3 | |
Acquisition related (a) | [1] | 0.1 |
Foreign currency translation | (5.1) | |
Balance at July 3, 2015 | 577.3 | |
Enterprise Cabling And Security [Member] | ||
Goodwill [Roll Forward] | ||
Balance at January 2, 2015 | 403.4 | |
Acquisition related (a) | [1] | 0.1 |
Foreign currency translation | (4.3) | |
Balance at July 3, 2015 | 399.2 | |
Wire And Cable [Member] | ||
Goodwill [Roll Forward] | ||
Balance at January 2, 2015 | 178.9 | |
Acquisition related (a) | [1] | 0 |
Foreign currency translation | (0.8) | |
Balance at July 3, 2015 | $ 178.1 | |
[1] | (a) In the second quarter of 2015, we recorded an immaterial increase in goodwill related to the purchase price allocation for the acquisition of Tri-Ed. |
SUBSEQUENT EVENTS SUBSEQUENT 49
SUBSEQUENT EVENTS SUBSEQUENT EVENTS (Details) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended |
Oct. 02, 2015 | Jan. 02, 2015 | |
Subsequent Event [Line Items] | ||
Total purchase price | $ 427.8 | |
Subsequent Event Type [Member] | ||
Subsequent Event [Line Items] | ||
Total purchase price | $ 825 |