Document and Entity Information
Document and Entity Information - USD ($) | 12 Months Ended | ||
Oct. 31, 2016 | Dec. 08, 2016 | Apr. 30, 2016 | |
Document And Entity Information [Abstract] | |||
Document Type | 10-K | ||
Amendment Flag | false | ||
Document Period End Date | Oct. 31, 2016 | ||
Document Fiscal Year Focus | 2,016 | ||
Document Fiscal Period Focus | FY | ||
Trading Symbol | SAFM | ||
Entity Registrant Name | SANDERSON FARMS INC | ||
Entity Central Index Key | 812,128 | ||
Current Fiscal Year End Date | --10-31 | ||
Entity Well-known Seasoned Issuer | Yes | ||
Entity Current Reporting Status | Yes | ||
Entity Voluntary Filers | No | ||
Entity Filer Category | Large Accelerated Filer | ||
Entity Common Stock, Shares Outstanding | 22,739,667 | ||
Entity Public Float | $ 1,958,149,292 |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Oct. 31, 2016 | Oct. 31, 2015 |
Current assets: | ||
Cash and cash equivalents | $ 234,111 | $ 196,659 |
Accounts receivable, less allowance of $2,650 in 2016 and $2,500 in 2015 | 124,348 | 112,924 |
Inventories | 220,306 | 198,753 |
Refundable income taxes | 0 | 16,414 |
Prepaid expenses | 34,559 | 33,331 |
Total current assets | 613,324 | 558,081 |
Property, plant and equipment: | ||
Land and buildings | 668,476 | 570,202 |
Machinery and equipment | 837,120 | 748,328 |
Property, plant and equipment, gross | 1,505,596 | 1,318,530 |
Accumulated depreciation | (701,605) | (636,196) |
Property, plant and equipment, net | 803,991 | 682,334 |
Other assets | 5,385 | 6,337 |
Total assets | 1,422,700 | 1,246,752 |
Current liabilities: | ||
Accounts payable | 72,774 | 62,816 |
Accrued expenses | 57,918 | 88,431 |
Accrued income taxes | 17,497 | 0 |
Current maturities of long-term debt | 0 | 10,000 |
Total current liabilities | 148,189 | 161,247 |
Claims payable and other liabilities | 8,501 | 8,119 |
Deferred income taxes | 75,748 | 47,525 |
Commitments and contingencies | ||
Preferred Stock: | ||
Series A Junior Participating Preferred Stock, $100 par value: authorized shares-500,000; none issued - Par value to be determined by the Board of Directors: authorized shares-4,500,000; none issued | ||
Common Stock, $1 par value: authorized shares-100,000,000; issued and outstanding shares- 22,693,225 in 2016 and 22,520,875 in 2015 | 22,693 | 22,521 |
Paid-in capital | 125,855 | 111,687 |
Retained earnings | 1,041,714 | 895,653 |
Total stockholders’ equity | 1,190,262 | 1,029,861 |
Total liabilities and stockholders’ equity | $ 1,422,700 | $ 1,246,752 |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) $ in Thousands | Oct. 31, 2016 | Oct. 31, 2015 |
Accounts receivable, allowance | $ 2,650 | $ 2,500 |
Common Stock, par value (in usd per share) | $ 1 | $ 1 |
Common Stock, authorized shares | 100,000,000 | 100,000,000 |
Common Stock, issued shares | 22,693,225 | 22,520,875 |
Common Stock, outstanding shares | 22,693,225 | 22,520,875 |
Series A Junior Participating Preferred Stock | ||
Preferred Stock, par value (in usd per share) | $ 100 | $ 100 |
Preferred Stock, authorized shares | 500,000 | 500,000 |
Preferred Stock, issued shares | 0 | 0 |
Other Preferred Stock | ||
Preferred Stock, authorized shares | 4,500,000 | 4,500,000 |
Preferred Stock, issued shares | 0 | 0 |
CONSOLIDATED STATEMENTS OF OPER
CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) $ in Thousands | 12 Months Ended | ||
Oct. 31, 2016 | Oct. 31, 2015 | Oct. 31, 2014 | |
Income Statement [Abstract] | |||
Net sales | $ 2,816,057 | $ 2,803,480 | $ 2,774,845 |
Cost and expenses: | |||
Cost of sales | 2,362,056 | 2,312,368 | 2,253,898 |
Selling, general and administrative | 159,890 | 155,114 | 139,025 |
Cost and expenses | 2,521,946 | 2,467,482 | 2,392,923 |
Operating income | 294,111 | 335,998 | 381,922 |
Other income (expense): | |||
Interest income | 244 | 106 | 60 |
Interest expense | (1,708) | (2,136) | (2,577) |
Other | 30 | 123 | 61 |
Other income (expense) | (1,434) | (1,907) | (2,456) |
Income before income taxes | 292,677 | 334,091 | 379,466 |
Income tax expense | 103,716 | 118,090 | 130,418 |
Net income | $ 188,961 | $ 216,001 | $ 249,048 |
Earnings per share: | |||
Basic (in usd per share) | $ 8.37 | $ 9.52 | $ 10.80 |
Diluted (in usd per share) | 8.37 | 9.52 | 10.80 |
Dividends per share (in usd per share) | $ 1.9 | $ 1.38 | $ 1.32 |
CONSOLIDATED STATEMENTS OF STOC
CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY - USD ($) $ in Thousands | Total | Common Stock | Paid-In Capital | Retained Earnings |
Beginning Balance at Oct. 31, 2013 | $ 671,599 | $ 23,016 | $ 142,482 | $ 506,101 |
Beginning Balance (in shares) at Oct. 31, 2013 | 23,016,241 | |||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||
Net income for year | 249,048 | 249,048 | ||
Cash dividends ($1.32, $1.38 and 1.90 per share for the year ended 2013, 2014 and 2015 respectively) | (30,453) | (30,453) | ||
Issuance of stock under stock compensation plans | (4,642) | $ 114 | (4,756) | |
Issuance of stock under stock compensation plans (in shares) | 114,262 | |||
Amortization of unearned compensation | 12,396 | 12,396 | ||
Ending Balance at Oct. 31, 2014 | 897,948 | $ 23,130 | 150,122 | 724,696 |
Ending Balance (in shares) at Oct. 31, 2014 | 23,130,503 | |||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||
Net income for year | 216,001 | 216,001 | ||
Cash dividends ($1.32, $1.38 and 1.90 per share for the year ended 2013, 2014 and 2015 respectively) | (31,092) | (31,092) | ||
Purchase of common stock | (55,192) | $ (700) | (40,540) | (13,952) |
Purchase of common stock (in shares) | (700,003) | |||
Issuance of stock under stock compensation plans | (9,883) | $ 91 | (9,974) | |
Issuance of stock under stock compensation plans (in shares) | 90,375 | |||
Amortization of unearned compensation | 12,079 | 12,079 | ||
Ending Balance at Oct. 31, 2015 | 1,029,861 | $ 22,521 | 111,687 | 895,653 |
Ending Balance (in shares) at Oct. 31, 2015 | 22,520,875 | |||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||
Net income for year | 188,961 | 188,961 | ||
Cash dividends ($1.32, $1.38 and 1.90 per share for the year ended 2013, 2014 and 2015 respectively) | (42,900) | (42,900) | ||
Issuance of stock under stock compensation plans | 841 | $ 172 | 669 | |
Issuance of stock under stock compensation plans (in shares) | 172,350 | |||
Amortization of unearned compensation | 13,499 | 13,499 | ||
Ending Balance at Oct. 31, 2016 | $ 1,190,262 | $ 22,693 | $ 125,855 | $ 1,041,714 |
Ending Balance (in shares) at Oct. 31, 2016 | 22,693,225 |
CONSOLIDATED STATEMENTS OF STO6
CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY (Parenthetical) - $ / shares | 12 Months Ended | ||
Oct. 31, 2016 | Oct. 31, 2015 | Oct. 31, 2014 | |
Statement of Stockholders' Equity [Abstract] | |||
Cash dividends, per share (in usd per share) | $ 1.90 | $ 1.38 | $ 1.32 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 12 Months Ended | ||
Oct. 31, 2016 | Oct. 31, 2015 | Oct. 31, 2014 | |
Operating activities | |||
Net income | $ 188,961 | $ 216,001 | $ 249,048 |
Adjustments to reconcile net income to net cash provided by operating activities: | |||
Depreciation and amortization | 84,583 | 74,661 | 64,309 |
Amortization of share-based compensation | 15,813 | 16,068 | 12,396 |
Provision for losses on accounts receivable | 150 | 300 | 0 |
Deferred income taxes | 28,223 | 4,781 | (9,867) |
Change in assets and liabilities: | |||
Accounts receivable | (11,574) | 5,071 | (9,316) |
Inventories | (21,553) | (7,930) | 15,032 |
Income taxes | 33,911 | (37,903) | 10,434 |
Prepaid expenses and other assets | (1,263) | (1,162) | (3,026) |
Accounts payable | 5,109 | 11,615 | (32,718) |
Accrued expenses, claims payable and other liabilities | (29,511) | 16,304 | 10,175 |
Total adjustments | 103,888 | 81,805 | 57,419 |
Net cash provided by operating activities | 292,849 | 297,806 | 306,467 |
Investing activities | |||
Capital expenditures | (200,882) | (158,289) | (171,626) |
Net proceeds from sale of property and equipment | 478 | 848 | 514 |
Net cash used in investing activities | (200,404) | (157,441) | (171,112) |
Financing activities | |||
Principal payments on long-term debt | (10,000) | (10,000) | (10,000) |
Principal payments on capital lease obligations | 0 | 0 | (10,213) |
Payments for debt issuance costs | 0 | (1,960) | 0 |
Dividends paid | (42,900) | (31,092) | (30,453) |
Repurchase of common stock | 0 | (55,193) | 0 |
Tax benefit from stock incentive plans | 3,910 | 2,630 | 1,016 |
Proceeds from issuance of restricted stock under stock compensation plans | 1,279 | 1,209 | 901 |
Payments from issuance of common stock under stock compensation plans | (7,282) | (14,910) | (6,559) |
Net cash used in financing activities | (54,993) | (109,316) | (55,308) |
Net change in cash and cash equivalents | 37,452 | 31,049 | 80,047 |
Cash and cash equivalents at beginning of year | 196,659 | 165,610 | 85,563 |
Cash and cash equivalents at end of year | 234,111 | 196,659 | 165,610 |
Supplemental disclosure of cash flow information: | |||
Income taxes paid | 72,213 | 149,770 | 130,023 |
Interest paid, net | $ 1,709 | $ 2,615 | $ 3,548 |
Significant Accounting Policies
Significant Accounting Policies | 12 Months Ended |
Oct. 31, 2016 | |
Accounting Policies [Abstract] | |
Significant Accounting Policies | Significant Accounting Policies Basis of Presentation: The consolidated financial statements include the accounts of Sanderson Farms, Inc. (the “Company”) and its wholly-owned subsidiaries. All significant intercompany transactions and accounts have been eliminated in consolidation. Certain reclassifications have been made to prior year financial statements to conform to the current year's presentation, including balance sheet reclassifications for current deferred income tax assets in relation to the Company's retrospective adoption of Accounting Standards Update No. 2015-17, "Income Taxes - Balance Sheet Classification of Deferred Taxes." Refer to the "Impact of Recently Issued Accounting Standards" sub-section below for a description of the resulting reclassification to the related balance sheet items previously reported as of October 31, 2015. Business: The Company is engaged in the production, processing, marketing and distribution of fresh and frozen chicken and other prepared chicken items. The Company’s net sales and cost of sales are significantly affected by market price fluctuations of its principal products sold and of its principal feed ingredients, corn and other grains. The Company sells to retailers, distributors and casual dining operators primarily in the southeastern, southwestern, northeastern and western United States. Management periodically performs credit evaluations of its customers’ financial condition and generally does not require collateral. One customer accounted for more than 10% of consolidated sales for each of the years ended October 31, 2016 , 2015 and 2014 . Sales to that customer accounted for 17.5% , 16.2% , and 15.9% of the Company’s consolidated net sales in fiscal 2016 , 2015 , and 2014 , respectively. Shipping and handling costs are included as a component of cost of sales. Generally, revenue is recognized in connection with a transaction when the Company has agreed to sell, and our customer has agreed to purchase, a specific quantity of product, when delivery has occurred, when the price to the buyer has been fixed, and when collectability is reasonably assured. For most customers, this occurs when the product is delivered to customers, which for domestic sales usually occurs at the time of shipment. Revenue on certain international sales is recognized upon transfer of title, which may occur after shipment. Revenue is recognized as the net amount estimated to be received after deducting estimated amounts for discounts, cooperative advertising allowances, product terms and other items. RECONCILIATION OF GROSS SALES TO NET SALES DOLLARS (in millions) Product Category Description Fiscal Year 2016 Fiscal Year 2015 Fiscal Year 2014 Fresh Ice Packed Chicken Gross Sales $ 438.5 $ 399.1 $ 336.7 Commissions (4.2 ) (4.1 ) (3.7 ) Sales and Customer Allowances (14.1 ) (12.8 ) (11.2 ) Other (1) (13.5 ) (13.5 ) (8.5 ) Net Sales 406.7 368.7 313.3 Chill Pack Chicken Gross Sales 999.9 1,057.6 1,025.3 Commissions (4.4 ) (4.6 ) (5.5 ) Sales and Customer Allowances (5.7 ) (6.5 ) (8.7 ) Other (1) (5.6 ) (5.3 ) (5.4 ) Net Sales 984.2 1,041.2 1,005.7 Frozen Chicken Gross Sales 144.0 178.3 257.9 Commissions — (0.1 ) (0.3 ) Sales and Customer Allowances — — — Other (1) (0.5 ) (0.6 ) (1.9 ) Net Sales 143.5 177.6 255.7 Fresh Vacuum Sealed Chicken Gross Sales 1,085.7 1,010.6 1,026.8 Commissions (1.9 ) (1.7 ) (1.8 ) Sales and Customer Allowances (9.4 ) (9.0 ) (9.1 ) Other (1) (7.5 ) (7.7 ) (6.7 ) Net Sales 1,066.9 992.2 1,009.2 Minimally Prepared Chicken Gross Sales 186.0 187.7 155.7 Commissions (0.4 ) (0.5 ) (0.7 ) Sales and Customer Allowances (0.2 ) (0.1 ) (0.5 ) Other (1) (0.3 ) (0.3 ) (0.2 ) Net Sales 185.1 186.8 154.3 Mechanically Deboned Chicken Gross Sales 29.7 37.0 36.6 Commissions — — — Sales and Customer Allowances — — — Other (1) — — — Net Sales 29.7 37.0 36.6 Totals Gross Sales 2,883.8 2,870.3 2,839.0 Commissions (10.9 ) (11.0 ) (12.0 ) Sales and Customer Allowances (29.4 ) (28.4 ) (29.5 ) Other (1) (27.4 ) (27.4 ) (22.7 ) Net Sales $ 2,816.1 $ 2,803.5 $ 2,774.8 (1) Other deductions include short weights, miscellaneous deductions, credit memos, rebates and other items. Sales of offal are considered by-products; accordingly, these amounts reduce cost of sales and totaled $27.8 million , $31.2 million and $43.1 million in fiscal 2016 , 2015 and 2014 , respectively. The Company sells certain of its products either directly to foreign markets or to U.S. based customers who resell the product in foreign markets. These foreign markets for fiscal 2016 were primarily Mexico, Central Asia and the Middle East. For fiscal 2015 and 2014, these foreign markets were primarily Mexico, Russia, China, Eastern Europe, the Middle East and the Carribean. These export sales for fiscal years 2016 , 2015 and 2014 totaled approximately $213.5 million , $207.8 million and $282.3 million , respectively. The Company does not believe that the amount of sales attributable to any single foreign country is material to its total sales during any of the periods presented. The Company’s export sales are facilitated through independent food brokers located in the United States and the Company’s internal sales staff. Use of Estimates: The preparation of the consolidated financial statements in conformity with U.S. generally accepted accounting principles requires management to make estimates and assumptions that affect the amounts reported in the consolidated financial statements and accompanying notes. Actual results could differ from those estimates. Cash Equivalents: The Company considers all highly liquid investments with maturities of ninety days or less when purchased to be cash equivalents. Allowance for Doubtful Accounts: In the normal course of business, the Company extends credit to its customers on a short-term basis. Although credit risks associated with our customers are considered minimal, the Company routinely reviews its accounts receivable balances and makes provisions for probable doubtful accounts based on an individual assessment of a customer’s credit quality as well as subjective factors and trends, including the aging of receivable balances. In circumstances where management is aware of a specific customer’s inability to meet its financial obligations to the Company, a specific reserve is recorded to reduce the receivable to the amount expected to be collected. If circumstances change (i.e., higher than expected defaults or an unexpected material adverse change in a major customer’s ability to meet its financial obligations to us), our estimates of the recoverability of amounts due us could be reduced by a material amount and the allowance for doubtful accounts and related bad debt expense would increase by the same amount. Inventories: Processed and prepared inventories and inventories of feed, eggs, medication and packaging supplies are stated at the lower of cost (average method) or market value. Live poultry inventories of broilers are stated at the lower of cost or market value and breeders at cost less accumulated amortization. The costs associated with breeders, including breeder chicks, feed, medicine and grower pay, are accumulated up to the production stage and amortized over nine months using the straight-line method. When the projected cost to complete, process and sell broilers in live inventory exceeds the expected market value for the finished product, the Company reduces the value of live inventories from cost to market. Property, Plant and Equipment: Property, plant and equipment is stated at cost. Depreciation of property, plant and equipment is provided by the straight-line method over the estimated useful lives of 15 to 39 years for buildings and 3 to 12 years for machinery and equipment. During fiscal 2016, 2015 and 2014, the Company capitalized interest of $0.3 million , $0.5 million and $1.1 million , respectively, related to new facilities under construction at the time in Laurel, Mississippi, St. Pauls, North Carolina, and Palestine, Texas. Impairment of Long-Lived Assets: The Company continually reevaluates the carrying value of its long-lived assets based on events or changes in circumstances which indicate that the carrying value may not be recoverable. As part of this reevaluation and when indicators are present, the Company estimates the future cash flows expected to result from the use of the asset and its eventual disposal. If the sum of the expected future cash flows (undiscounted and without interest charges) is less than the carrying amount of the asset, an impairment loss, based on the fair value of the assets, is recognized through a charge to operations. Self-Insurance Programs: Insurance expense for workers’ compensation benefits and employee-related health care benefits are estimated using historical experience and actuarial estimates. The Company accrues expenses in its workers’ compensation and employee benefit plans for both known claims as well as claims incurred but not reported. Stop-loss coverage is maintained with third party insurers to limit the Company’s total exposure. Management regularly reviews the assumptions used to recognize periodic expenses. Any resulting adjustments to accrued claims are reflected in current operating results. There are no material adjustments to expenses accrued in prior periods in current expenses. If historical experience proves not to be a good indicator of future expenses, if management were to use different actuarial assumptions, or if there is a negative trend in the Company’s claims history, there could be a significant increase or decrease in cost of sales depending on whether these expenses increased or decreased, respectively. Advertising and Marketing Costs: The Company expenses advertising costs as incurred. Advertising costs are included in selling, general and administrative expenses and totaled $25.1 million , $13.1 million and $12.9 million for fiscal 2016 , 2015 and 2014 , respectively. Income Taxes: Deferred income taxes are accounted for using the liability method and relate principally to depreciation expense, stock based compensation programs and self-insurance programs accounted for differently for financial and income tax purposes. During fiscal 2016, the Company retrospectively adopted Accounting Standards Update No. 2015-17, "Income Taxes - Balance Sheet Classification of Deferred Taxes," which requires an entity to classify all deferred tax assets and liabilities as noncurrent. Refer to the "Impact of Recently Issued Accounting Standards" sub-section below for a description of the resulting reclassification to the related balance sheet items previously reported as of October 31, 2015. Valuation allowances are recorded when it is more likely than not some or all of a deferred tax asset will not be realized. The Company is periodically audited by taxing authorities and considers any adjustments, interest, and penalties incurred as a result of the audits in computing and reporting income tax expense. Any audit adjustments could have a material impact on the Company’s effective tax rate. Tax periods for fiscal years 2013 through 2016 remain open to examination by federal and state taxing jurisdictions to which the Company is subject. Share-Based Compensation: The Company accounts for all share-based payments to employees, including grants of restricted stock and performance-based shares, in the income statement based on their fair values. For performance-based shares, the Company recognizes expense when management determines the performance criteria are probable of being met. Earnings Per Share: Basic earnings per share is based upon the weighted average number of common shares outstanding during the year. Share-based payment awards entitling holders to receive non-forfeitable dividends before vesting are considered participating securities and thus included in the calculation of basic earnings per share. These awards are included in the calculation of basic earnings per share under the two-class method. The two-class method allocates earnings for the period between common shareholders and other security holders. The participating awards receiving dividends are allocated the same amount of income as if they were outstanding shares. Diluted earnings per share includes any dilutive effects of options, warrants, restricted stock and convertible securities. Fair Value of Financial Instruments: The Company sometimes holds certain items that are required to be disclosed at fair value, primarily cash equivalents and debt instruments. Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. A three-level hierarchy is followed for disclosure to show the extent and level of judgment used to estimate fair value measurements: Level 1 – Inputs used to measure fair value are unadjusted quoted prices that are available in active markets for the identical assets or liabilities as of the reporting date. Level 2 – Inputs used to measure fair value, other than quoted prices included in Level 1, are either directly or indirectly observable as of the reporting date through correlation with market data, including quoted prices for similar assets and liabilities in active markets and quoted prices in markets that are not active. Level 2 also includes assets and liabilities that are valued using models or other pricing methodologies that do not require significant judgment since the input assumptions used in the models, such as interest rates and volatility factors, are corroborated by readily observable data from actively quoted markets for substantially the full term of the financial instrument. Level 3 – Inputs used to measure fair value are unobservable inputs that are supported by little or no market activity and reflect the use of significant management judgment. These values are generally determined using pricing models for which the assumptions utilize management’s estimates of market participant assumptions. At October 31, 2016 and October 31, 2015 , the fair value of the Company's cash and short-term cash investments approximated their carrying value due to the short maturity of these financial instruments and were categorized as a Level 2 measurement. Inputs used to measure fair value were primarily recent trading prices and prevailing market interest rates. Fair values for debt are based on quoted market prices or published forward interest rate curves and were categorized as Level 2 measurements. The fair value and carrying value of the Company’s borrowings under its long-term debt were as follows: October 31, 2016 October 31, 2015 Fair Value Carrying Value Fair Value Carrying Value Total Debt (In millions) $ — $ — $ 10.2 $ 10.0 Impact of Recently Issued Accounting Standards: In March 2016, the FASB issued guidance requiring all income tax effects of stock awards to be recognized in the statement of operations when the awards vest or are settled rather than recording excess tax benefits or deficiencies in additional paid-in capital. Additionally, classification of the related amounts in the statement of cash flows will be recognized within operating activities, rather than financing activities. The guidance also changes accounting for an employee's use of shares to satisfy the employer's statutory tax withholding obligation and for forfeitures. The standard becomes effective for interim and annual periods beginning after December 15, 2016, our fiscal 2018. Early adoption is permitted. The effect of this new standard’s provisions on excess tax benefits or deficiencies in our consolidated financial statements will depend on the changes in the Company’s stock prices at vesting dates and grant dates for awards that vest after adoption. The changes in amounts repurchased for tax withholding purposes and changes in the accounting for forfeitures are not expected to have a material effect on our consolidated financial statements. In February 2016, the FASB issued guidance which is intended to increase transparency and comparability among companies by requiring an entity that is a lessee to recognize on the balance sheet the right-of-use assets and lease liabilities arising from all leases with terms, as defined by the guidance, of greater than twelve months. The guidance also requires disclosures of key information about the leasing arrangements. The guidance is effective for annual reporting periods and interim periods within those annual reporting periods beginning after December 15, 2018, our fiscal 2020. Early adoption is permitted. The Company is currently evaluating the impact this guidance will have on our consolidated financial statements. In November 2015, the FASB issued guidance that requires an entity to classify all deferred tax assets and liabilities as noncurrent. The standard is effective for fiscal years beginning after December 15, 2016, our fiscal 2018, and interim periods within those years. Early adoption is permitted. The Company adopted this standard, retrospectively, as of October 31, 2016. The changes in the effected income tax related balance sheet accounts at the prior year end were as follows: October 31, 2015 Prior to Adoption (previously reported) Effects of Adoption As Adopted (currently reported) Current Assets Current Deferred Income Taxes $ 4,709 $ (4,709 ) $ — Non-current Liabilities Deferred Income Taxes $ 52,234 $ (4,709 ) $ 47,525 In July 2015, the FASB issued guidance that requires an entity to measure inventory at the lower of cost or net realizable value. The guidance is effective for annual reporting periods and interim periods within those annual reporting periods beginning after December 15, 2016, our fiscal 2018. Early adoption is permitted and the prospective transition method should be applied. The Company is currently evaluating the impact this guidance will have on our consolidated financial statements. In April 2015, the FASB issued guidance requiring that debt issuance costs related to a recognized debt liability be presented in the balance sheet as a direct deduction from the carrying amount of that debt liability, consistent with debt discounts. The recognition and measurement guidance for debt issuance costs are not affected by the amendments in the new standard. The standard requires retrospective application and will be effective for financial statements issued for fiscal years beginning after December 15, 2015, our fiscal year 2017, and interim periods within those fiscal years. Early adoption is permitted. The Company does not believe adoption will have a material effect on our consolidated financial statements. In May 2014, the FASB issued guidance changing the criteria for recognizing revenue, which was amended in 2015 to defer the effective date by one year. The guidance also modifies the related disclosure requirements, clarifies guidance for multiple-element arrangements and provides guidance for transactions that were not addressed fully in previous guidance. The guidance, as amended, is effective for annual reporting periods and interim periods within those annual reporting periods beginning after December 15, 2017, our fiscal 2019. Early adoption is permitted for annual reporting periods and interim periods within those annual reporting periods beginning after December 15, 2016. The Company is currently evaluating the impact this guidance will have on our consolidated financial statements. |
Inventories
Inventories | 12 Months Ended |
Oct. 31, 2016 | |
Inventory Disclosure [Abstract] | |
Inventories | Inventories Inventories consisted of the following: October 31, 2016 2015 (In thousands) Live poultry-broilers and breeders $ 143,554 $ 131,984 Feed, eggs and other 40,834 37,109 Processed poultry 15,378 10,158 Prepared chicken 13,640 11,927 Packaging materials 6,900 7,575 $ 220,306 $ 198,753 |
Prepaid expenses
Prepaid expenses | 12 Months Ended |
Oct. 31, 2016 | |
Prepaid Expense, Current [Abstract] | |
Prepaid expenses | Prepaid expenses Prepaid expenses consisted of the following: October 31, 2016 2015 (In thousands) Parts and supplies $ 23,022 $ 21,332 Prepaid insurance 6,084 7,385 Other prepaid expenses 5,453 4,614 $ 34,559 $ 33,331 |
Accrued expenses
Accrued expenses | 12 Months Ended |
Oct. 31, 2016 | |
Payables and Accruals [Abstract] | |
Accrued expenses | Accrued expenses Accrued expenses consisted of the following: October 31, 2016 2015 (In thousands) Accrued bonuses $ 441 $ 30,360 Workers’ compensation claims 7,971 7,813 Accrued wages 8,415 6,169 Accrued rebates 6,761 6,347 Accrued vacation 6,721 5,999 Accrued property taxes 8,710 6,965 Product recall — 4,153 Accrued payroll taxes 9,209 9,991 Other accrued expenses 9,690 10,634 $ 57,918 $ 88,431 |
Long-Term debt obligations
Long-Term debt obligations | 12 Months Ended |
Oct. 31, 2016 | |
Debt Disclosure [Abstract] | |
Long-Term debt obligations | Long-Term debt obligations Long-term debt obligations consisted of the following: October 31, 2016 2015 (In thousands) Term loan, accruing interest at 6.12%, matured in 2016 — 10,000 — 10,000 Less current maturities of long-term debt — 10,000 $ — $ — The Company is a party to a revolving credit facility dated April 24, 2015, with a maximum available borrowing capacity of $750.0 million . The facility has an annual capital expenditure limitation of $100.0 million for fiscal years 2016 through 2020, and permits up to $15.0 million of the unused capital expenditure limitation from the prior fiscal year to be carried over to the next fiscal year. The capital expenditure limitation for fiscal 2016 is $115.0 million . The credit facility also permits the Company to spend up to $160.0 million in capital expenditures on the construction of the new poultry complex in St. Pauls, North Carolina, and up to $175.0 million in capital expenditures on the construction of a potential additional new poultry complex, which expenditures are in addition to the annual capital expenditure limits. In addition to the annual capital expenditure limits, the credit facility permits the Company to spend up to $15.0 million in capital expenditures on the acquisition of a new aircraft, and that provision was utilized during fiscal 2015 and the first quarter of fiscal 2016. Under the facility, the Company may not exceed a maximum debt to total capitalization ratio of 50% . The Company has a one-time right, at any time during the term of the agreement, to increase the maximum debt to total capitalization ratio then in effect by five percentage points in connection with the construction of either the St. Pauls, North Carolina complex or a second potential new poultry complex for the four fiscal quarters beginning on the first day of the fiscal quarter during which the Company gives written notice of its intent to exercise this right. The Company has not exercised this right. The facility also sets a minimum net worth requirement that at October 31, 2016 , was $833.1 million . The credit is unsecured and, unless extended, will expire on April 24, 2020. As of October 31 and December 8, 2016 , the Company had zero outstanding draws under the facility, and had approximately $16.3 million outstanding in letters of credit, leaving $733.7 million available under the facility. The Company has the option to borrow funds under the revolving line of credit based on the Prime interest rate or the Libor interest rate plus a spread ranging from 0.25% to 1.50% . The spread on Libor borrowings and the commitment fee for the unused balance of the revolving credit agreement are determined based upon the Company’s leverage ratio as follows: Level Leverage Ratio Spread Commitment Fee 1 < 25% 0.25 % 0.20 % 2 ≥ 25% and < 35% 0.50 % 0.25 % 3 ≥ 35% and < 45% 1.00 % 0.30 % 4 ≥ 45% 1.50 % 0.35 % |
Income Taxes
Income Taxes | 12 Months Ended |
Oct. 31, 2016 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes Income tax expense consisted of the following: Years Ended October 31, 2016 2015 2014 (In thousands) Current expense: Federal $ 67,880 $ 101,605 $ 127,519 State 7,613 11,704 12,766 75,493 113,309 140,285 Deferred expense (benefit): Federal 27,983 4,169 (8,769 ) State 1,194 1,043 577 Change in valuation allowance (954 ) (431 ) (1,675 ) 28,223 4,781 (9,867 ) $ 103,716 $ 118,090 $ 130,418 Significant components of the Company’s deferred tax assets and liabilities are outlined below. During fiscal 2016, the Company retrospectively adopted Accounting Standards Update No. 2015-17, "Income Taxes - Balance Sheet Classification of Deferred Taxes," which requires an entity to classify all deferred tax assets and liabilities as noncurrent. Refer to the "Impact of Recently Issued Accounting Standards" sub-section of the Significant Accounting Policies footnote for a description of the resulting reclassification to the related balance sheet items previously reported as of October 31, 2015. October 31, 2016 2015 (In thousands) Deferred tax liabilities: Property, plant and equipment $ 96,027 $ 67,923 Prepaid and other assets 2,243 2,248 Total deferred tax liabilities 98,270 70,171 Deferred tax assets: Accrued expenses and accounts receivable 10,572 10,091 Inventory 493 219 Compensation on restricted stock 10,591 11,820 State income tax credits 15,229 15,833 Other 166 166 Valuation allowance (14,529 ) (15,483 ) Total deferred tax assets 22,522 22,646 Net deferred tax liabilities $ 75,748 $ 47,525 The increase in the Company's deferred tax liability is primarily attributable to legislation enacted during the first quarter of fiscal 2016 which allowed for bonus depreciation to be taken on qualifying assets placed in service during the 2015 calendar year and the Company's decision to take advantage of the legislation. Included in the deferred tax assets at October 31, 2016 , are North Carolina Investing in Business Property Credit and North Carolina Jobs Credits totaling $12,351,000 , as well as Georgia Job Tax Credits totaling $2,878,000 . The North Carolina Investing in Business Property Credit provides a 7% investment tax credit for property located in a North Carolina development area, the North Carolina Creating Jobs Credit provides a tax credit for increased employment in North Carolina, and the Georgia Job Tax Credit provides a tax credit for creation and retention of qualifying jobs in Georgia. It is management’s opinion that the majority of the North Carolina and Georgia income tax credits will not be utilized before they expire, and a $14,529,000 valuation allowance has been recorded. These credits expire between fiscal years 2017 and 2023 . At the end of each reporting period, the Company evaluates all available information at that time to determine if it is more likely than not that some or all of these credits will be utilized. As of October 31, 2016 , 2015 , and 2014 , the Company determined that a total of $700,000 , $350,000 , and $633,000 , respectively, would be recovered. Accordingly, those amounts were released from the valuation allowance and benefited deferred tax expense in the respective periods. The differences between the consolidated effective income tax rate and the federal statutory rate of 35.0% are as follows: Years Ended October 31, 2016 2015 2014 (In thousands) Income taxes at statutory rate $ 102,437 $ 116,932 $ 132,813 State income taxes 7,007 8,757 9,450 State income tax credits (948 ) (342 ) (191 ) Federal income tax credits (390 ) (90 ) (97 ) Federal manufacturers deduction (8,425 ) (10,714 ) (12,636 ) Nondeductible expenses 2,482 3,234 2,909 Other, net 2,507 744 (155 ) Change in valuation allowance (954 ) (431 ) (1,675 ) Income tax expense $ 103,716 $ 118,090 $ 130,418 |
Earnings Per Share
Earnings Per Share | 12 Months Ended |
Oct. 31, 2016 | |
Earnings Per Share [Abstract] | |
Earnings Per Share | Earnings Per Share Certain share-based payment awards entitling holders to receive non-forfeitable dividends before vesting are considered participating securities and thus included in the calculation of basic earnings per share, to the extent they are dilutive. These awards are included in the calculation of basic earnings per share under the two-class method. The two-class method allocates earnings for the period between common shareholders and other security holders. The participating awards receiving dividends are allocated the same amount of income as if they were outstanding shares. The following table presents earnings per share (in thousands). For the years ended October 31, 2016 October 31, 2015 October 31, 2014 Net income $ 188,961 $ 216,001 $ 249,048 Distributed and undistributed (earnings) to unvested restricted stock (2,930 ) (4,172 ) (6,781 ) Distributed and undistributed earnings to common shareholders — Basic 186,031 211,829 242,267 Weighted average shares outstanding — Basic 22,225 22,243 22,441 Weighted average shares outstanding — Diluted 22,225 22,243 22,441 Earnings per common share — Basic $ 8.37 $ 9.52 $ 10.80 Earnings per common share — Diluted $ 8.37 $ 9.52 $ 10.80 |
Employee Benefit Plans
Employee Benefit Plans | 12 Months Ended |
Oct. 31, 2016 | |
Compensation and Retirement Disclosure [Abstract] | |
Employee Benefit Plans | Employee Benefit Plans The Company has an Employee Stock Ownership Plan (“ESOP”) covering substantially all employees. Contributions to the ESOP are made in cash at the discretion of the Company’s Board of Directors. Total contributions to the ESOP were $12,300,000 , $15,000,000 , and $15,000,000 in fiscal 2016 , 2015 , and 2014 , respectively. Contributions to the ESOP vary in amount, as the contributions are based on profitability. The Company has a 401(k) Plan which covers substantially all employees after one year of service. Participants in the Plan may contribute up to the maximum allowed by Internal Revenue Service regulations. The Company matches 100% of employee contributions to the 401(k) Plan up to 3% of each employee’s salary, and 50% of employee contributions between 3% and 5% of each employee’s salary. The Company’s contributions to the 401(k) Plan totaled $7,404,000 in fiscal 2016 ; $6,670,000 in fiscal 2015 ; and $6,058,000 in fiscal 2014 . |
Stock Compensation Plans
Stock Compensation Plans | 12 Months Ended |
Oct. 31, 2016 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Stock Compensation Plans | Stock Compensation Plans On February 17, 2005, the shareholders of the Company approved the Sanderson Farms, Inc. and Affiliates Stock Incentive Plan (the “Plan”). The Plan allows the Company’s Board of Directors to grant certain incentive awards including stock options, stock appreciation rights, restricted stock, and other similar awards. The Company was authorized to award up to 2,250,000 shares under the Plan. On February 17, 2011, the shareholders approved changes to the plan to increase the shares that may be issued under the plan from 2,250,000 to 3,500,000 shares and to increase the number of shares that may be granted in the form of restricted stock from 562,500 to 1,562,500 shares. On February 11, 2016, the shareholders approved the authorization of an additional 700,000 shares issuable under plan, for a total of 4,200,000 authorized shares. The shareholders also approved an increase in the number of shares issuable as restricted stock from 1,562,500 to 2,112,500 shares. Pursuant to the Plan, the Company’s Board of Directors approves agreements for the issuance of restricted stock to directors, executive officers and other key employees. Restricted stock granted in fiscal 2016 , 2015 and 2014 , vests three to four years from the date of grant. The vesting schedule is accelerated upon death, disability, the participant’s termination of employment after reaching retirement eligibility, by reason of retirement, or upon a change in control, as defined. Restricted stock grants are valued based upon the closing market price of the Company’s common stock on the date of grant and are recognized as compensation expense over the vesting period. Compensation expense related to restricted stock grants totaled $6,459,000 ; $6,452,000 ; and $4,831,000 during fiscal 2016 , 2015 and 2014 , respectively. A summary of the Company’s restricted stock activity and related information is as follows: Number of Shares Weighted Average Grant Price Outstanding at October 31, 2013 568,625 $ 44.85 Granted during fiscal 2014 98,925 $ 67.26 Vested during 2014 (84,601 ) $ 40.22 Forfeited during 2014 (16,899 ) $ 47.20 Outstanding at October 31, 2014 566,050 $ 49.39 Granted during fiscal 2015 77,600 $ 82.75 Vested during 2015 (327,988 ) $ 44.98 Forfeited during 2015 (1,362 ) $ 62.15 Outstanding at October 31, 2015 314,300 $ 62.16 Granted during fiscal 2016 101,935 $ 71.58 Vested during 2016 (119,407 ) $ 54.09 Forfeited during 2016 (3,018 ) $ 67.82 Outstanding at October 31, 2016 293,810 $ 68.65 The Company had $9.0 million in unrecognized share-based compensation costs related to the 293,810 unvested shares as of October 31, 2016 , that will be recognized over a weighted average period of 1 year, 9 months . Also pursuant to the Plan, the Company’s Board of Directors approves Management Share Purchase Plan agreements (the “Purchase Plan”) that authorize the issuance of shares of restricted stock to the Company’s directors, executive officers and other key employees. Pursuant to the Purchase Plan, non-employee directors may elect to receive up to 100 percent of their annual retainer and meeting fees in the form of restricted stock. Other participants may elect to receive up to 15 percent of their salary and up to 75 percent of any bonus earned in the form of restricted stock. The purchase price of the restricted stock is the closing market price of the Company’s common stock on the date of purchase. The Company makes matching contributions of 25 percent of the restricted shares purchased by participants. Restricted stock issued pursuant to the Purchase Plan vests after three years or immediately upon death, disability, or change in control, as defined. If an employee terminates employment after attaining eligibility for retirement, or a non-employee director retires upon the expiration of his or her board term, the participant’s Purchase Plan shares vest immediately. If a participant’s employment or service as a director is terminated for any other reason prior to the three -year vesting period, the participant forfeits the matching contribution and the Company may, at its option, repurchase restricted stock purchased by the participant at the price paid by the participant. Matching contributions are recognized as compensation expense over the vesting period. During fiscal 2016 , 2015 and 2014 , the participants purchased a total of 15,075 ; 15,395 ; and 12,823 shares of restricted stock pursuant to the Purchase Plan, valued at an average price of $84.71 , $78.53 , and $80.80 , per share, respectively, and the Company issued 3,650 ; 3,734 ; and 3,101 matching shares, valued at an average price of $84.71 , $78.53 , and $80.80 per share, respectively. During fiscal 2016 , 2015 and 2014 , the participants vested in a total of 16,746 ; 21,540 ; and 24,445 shares of restricted stock pursuant to the Purchase Plan, valued at an average price of $57.41 , $51.06 , and $43.98 , per share, respectively. During fiscal 2016 , 2015 and 2014 , the participants forfeited a total of 484 ; 112 ; and 1,523 shares of restricted stock pursuant to the Purchase Plan, respectively. Compensation expense related to the Company’s matching contribution totaled approximately $313,000 , $297,000 and $199,000 in fiscal 2016 , 2015 and 2014 , respectively. During fiscal 2016 , 2015 and 2014 , the Company entered into performance share agreements that grant certain officers and key employees the right to receive shares of the Company’s common stock, subject to the Company’s achievement of certain performance measures. The performance share agreements specify a target number of shares that a participant can receive based upon the Company’s average return on equity and average return on sales, as defined, during a two -year performance period beginning November 1 of each performance period. Although the performance share agreements have a two -year performance period, they are subject to an additional one year period during which the participant must remain employed by the Company before they are paid out. If the Company’s average return on equity and average return on sales exceed certain threshold amounts for the performance period, participants will receive 50 percent to 200 percent of the target number of shares, depending upon the Company’s level of performance. The target number of shares specified in the performance share agreements executed during fiscal 2016 totaled 83,875 . As of October 31, 2016, the Company could not determine that achievement of the applicable performance based criteria is probable due to the uncertainties discussed below, and therefore recorded no compensation expense related to those agreements. The Company also has performance share agreements in place with certain officers and key employees that were entered into during fiscal 2015. During fiscal 2016, the Company determined based on combined results of fiscal 2015 and 2016, that achievement of the applicable performance based criteria for the fiscal 2015 agreements is probable at a level between the target and maximum levels. Accordingly, fiscal 2016 includes compensation expense of $5,876,000 , as compared to no compensation expense recorded during fiscal 2015 related to the fiscal 2015 agreements. As of October 31, 2016, the aggregate number of shares estimated to be awarded related to the fiscal 2015 performance share agreements totaled 103,974 shares. Since the performance period for those agreements has ended, the actual number of shares that will be awarded can change only due to potential forfeitures during the remaining twelve months of the service period ending October 31, 2017. The Compensation Committee of the Company's Board of Directors has determined that the performance shares granted November 1, 2013, have been earned at the maximum level. Accordingly, fiscal 2016 includes compensation expense of $3,165,000 , related to those agreements, as compared to $6,428,000 during fiscal 2015. Because management's initial determination of probability was made during fiscal 2015, and because adjustments to the accrual are made using the cumulative catch up method of accounting, the compensation expense recorded during fiscal 2015 related to the agreements entered into on November 1, 2013, was greater than that recorded during fiscal 2016. A total of 146,169 shares from the fiscal 2014 agreements vested and were issued on October 31, 2016. In estimating the compensation expense to record in a period, the Company considers, among other factors, current and projected grain costs and chicken volumes and pricing, as well as the amount of the Company's commitments to procure grain at a fixed price throughout the performance period. Due to the high level of volatility of these commodity prices and the impact that the change in pricing can have on the Company’s results, the Company’s assessment of probability can change from period to period and can result in a significant revision to the amounts accrued related to the arrangements. Had the Company determined that it was probable that the maximum amount of those outstanding awards from the fiscal 2016 agreements would be earned, an additional $3.8 million would have been accrued as of October 31, 2016 . A summary of the Company's compensation cost related to performance share agreements is as follows (in thousands): Number of shares issued (actual (a) or estimated (e)) For the years ended Date of Performance Share Agreement October 31, 2016 October 31, 2015 October 31, 2014 November 1, 2011 102,534 (a) $ — $ — $ 1,543 November 1, 2012 186,951 (a) — 2,891 5,823 November 1, 2013 146,169 (a) 3,165 6,428 — November 1, 2014 103,974 (e) 5,876 — — November 1, 2015 — — — — Total compensation cost $ 9,041 $ 9,319 $ 7,366 |
Commitments and Contingencies
Commitments and Contingencies | 12 Months Ended |
Oct. 31, 2016 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Commitments and Contingencies The Company has approximately 13,232 employees, approximately 13.3% of whom are covered by collective bargaining agreements. Each collective bargaining agreement has a grievance procedure and no strike-no lockout clauses that should assist in maintaining stable labor relations at the applicable facility. The Company has vehicle and equipment operating leases that expire at various dates through fiscal 2021 . Rental expense under these leases totaled approximately $13.7 million , $11.6 million , and $9.0 million during fiscal 2016 , 2015 and 2014 , respectively. The minimum lease payments of obligations under non-cancelable operating leases at October 31, 2016 were as follows (in millions): Fiscal Year Amount 2017 $ 11.5 2018 10.8 2019 6.5 2020 3.8 2021 1.5 $ 34.1 At October 31, 2016 , the Company’s estimated contractual obligations for feed grains, feed ingredients, and packaging supplies totaled $79.6 million , with the entire amount due in less than one year. In March 2015, the Company announced the selection of sites in and near St. Pauls, North Carolina, for the construction of its newest poultry complex. The completed complex will consist of a hatchery, processing plant, wastewater treatment facility, and an expansion of the Company's existing feed mill in Kinston, North Carolina. Construction began in July 2015, and initial operations of the new complex are expected to begin during the first quarter of fiscal 2017. The Company estimates the total investment in the complex will be approximately $155.0 million . As of October 31, 2016, the Company has spent approximately $135.6 million on the project, including approximately $265,000 of capitalized interest, and we are obligated to spend the remaining approximate $19.4 million during the first half of fiscal 2017. The amounts and timing of the remaining expenditures are estimates and are subject to change as the project moves toward completion. Between September 2, 2016 and October 13, 2016, Sanderson Farms, Inc. and our subsidiaries were named as defendants, along with 13 other poultry producers and certain of their affiliated companies, in multiple putative class action lawsuits filed by direct and indirect purchasers of broiler chickens in the United States District Court for the Northern District of Illinois. The complaints allege that the defendants conspired to unlawfully fix, raise, maintain and stabilize the price of broiler chickens, thereby violating federal and certain states' antitrust laws, and also allege certain related state-law claims. The complaints also allege that the defendants fraudulently concealed the alleged anticompetitive conduct in furtherance of the conspiracy. The complaints seek damages, including treble damages for the antitrust claims, injunctive relief, costs and attorneys’ fees. The court has consolidated each of the direct purchaser complaints into one case, and each of the indirect purchaser complaints into one case. On October 28, 2016, the plaintiffs filed consolidated, amended complaints in each case, and on November 23, 2016, the plaintiffs filed second amended complaints. The lawsuits are in the earliest stages and we intend to defend them vigorously; however, the Company cannot predict the outcome of these actions. If the plaintiffs were to prevail, the Company could be liable for damages, which could have a material, adverse effect on our financial position and results of operations. Sanderson Farms, Inc.; Joe F. Sanderson, Jr., the Chairman of the Registrant’s Board of Directors and its Chief Executive Officer; and D. Michael Cockrell, director and Chief Financial Officer, were named as defendants in a putative class action lawsuit filed on October 28, 2016, in the United States District Court for the Southern District of New York. The complaint alleges that the defendants made statements in the Registrant’s SEC filings and press releases, and other public statements, that were materially false and misleading in light of the Registrant’s alleged, undisclosed violation of the federal antitrust laws described above. The complaint also alleges that the material misstatements were made in order to, among other things, “artificially inflate and maintain the market price of Sanderson Farms securities.” The complaint alleges the defendants thereby violated the Securities Exchange Act of 1934, as amended (the “Exchange Act”), including Section 10(b) of the Exchange Act and Rule 10b-5 promulgated thereunder, and seeks damages, interest, costs and attorneys’ fees. The lawsuit is in its earliest stage and the defendants intend to defend it vigorously; however, the Company cannot predict the outcome of these actions. If the plaintiffs were to prevail, the Company could be liable for damages, which could have a material, adverse effect on our financial position and results of operations. The Company is involved in various other claims and litigation incidental to its business. Although the outcome of these matters cannot be determined with certainty, management, upon the advice of counsel, is of the opinion that the final outcome of any currently pending claim, other than those discussed above, should not have a material effect on the Company’s consolidated results of operations or financial position. The Company recognizes the costs of legal defense for the legal proceedings to which it is a party in the periods incurred. After a considerable analysis of each case, the Company determines the amount of reserves required, if any. At this time, the Company has not accrued any reserve for any of these matters. Future reserves may be required if losses are deemed reasonably estimable and probable due to changes in the Company’s assumptions, the effectiveness of legal strategies, or other factors beyond the Company’s control. Future results of operations may be materially affected by the creation of reserves or by accruals of losses to reflect any adverse determinations in these legal proceedings. |
Quarterly Financial Data (unaud
Quarterly Financial Data (unaudited) | 12 Months Ended |
Oct. 31, 2016 | |
Quarterly Financial Information Disclosure [Abstract] | |
Quarterly Financial Data (unaudited) | Quarterly Financial Data (unaudited) Fiscal Year 2016 First Quarter Second Quarter Third Quarter Fourth Quarter (In thousands, except per share data) (Unaudited) Net sales $ 605,166 $ 692,089 $ 727,991 $ 790,811 Gross profit 50,105 113,813 129,428 160,655 Net income 10,681 47,602 54,716 75,962 Diluted earnings per share $ 0.47 $ 2.11 $ 2.42 $ 3.36 Fiscal Year 2015 First Quarter Second Quarter Third Quarter Fourth Quarter (In thousands, except per share data) (unaudited) Net sales $ 667,363 $ 716,592 $ 739,933 $ 679,592 Gross profit 141,162 139,025 127,172 83,753 Net income 66,503 71,246 50,881 27,371 Diluted earnings per share $ 2.87 $ 3.13 $ 2.27 $ 1.22 |
Valuation and Qualifying Accoun
Valuation and Qualifying Accounts Schedule II | 12 Months Ended |
Oct. 31, 2016 | |
Valuation and Qualifying Accounts [Abstract] | |
Valuation and Qualifying Accounts Schedule II | Valuation and Qualifying Accounts Schedule II Classification Balance at Beginning of Period Charged to Costs and Expenses Charged to Other Accounts Deductions Describe(1) Balance at End of Period (In Thousands) Year Ended October 31, 2016 Deducted from accounts receivable: Allowance for doubtful accounts Totals $ 2,500 $ 178 $ 28 $ 2,650 Year Ended October 31, 2015 Deducted from accounts receivable: Allowance for doubtful accounts Totals $ 2,200 $ 300 $ — $ 2,500 Year Ended October 31, 2014 Deducted from accounts receivable: Allowance for doubtful accounts Totals $ 2,200 $ 29 $ 29 $ 2,200 _________________ (1) Uncollectible accounts written off, net of recoveries |
Significant Accounting Polici20
Significant Accounting Policies (Policies) | 12 Months Ended |
Oct. 31, 2016 | |
Accounting Policies [Abstract] | |
Principles of Consolidation | Basis of Presentation: The consolidated financial statements include the accounts of Sanderson Farms, Inc. (the “Company”) and its wholly-owned subsidiaries. All significant intercompany transactions and accounts have been eliminated in consolidation. |
Business | Business: The Company is engaged in the production, processing, marketing and distribution of fresh and frozen chicken and other prepared chicken items. The Company’s net sales and cost of sales are significantly affected by market price fluctuations of its principal products sold and of its principal feed ingredients, corn and other grains. The Company sells to retailers, distributors and casual dining operators primarily in the southeastern, southwestern, northeastern and western United States. Management periodically performs credit evaluations of its customers’ financial condition and generally does not require collateral. One customer accounted for more than 10% of consolidated sales for each of the years ended October 31, 2016 , 2015 and 2014 . Sales to that customer accounted for 17.5% , 16.2% , and 15.9% of the Company’s consolidated net sales in fiscal 2016 , 2015 , and 2014 , respectively. Shipping and handling costs are included as a component of cost of sales. Generally, revenue is recognized in connection with a transaction when the Company has agreed to sell, and our customer has agreed to purchase, a specific quantity of product, when delivery has occurred, when the price to the buyer has been fixed, and when collectability is reasonably assured. For most customers, this occurs when the product is delivered to customers, which for domestic sales usually occurs at the time of shipment. Revenue on certain international sales is recognized upon transfer of title, which may occur after shipment. Revenue is recognized as the net amount estimated to be received after deducting estimated amounts for discounts, cooperative advertising allowances, product terms and other items. |
Use of Estimates | Use of Estimates: The preparation of the consolidated financial statements in conformity with U.S. generally accepted accounting principles requires management to make estimates and assumptions that affect the amounts reported in the consolidated financial statements and accompanying notes. Actual results could differ from those estimates. |
Cash Equivalents | Cash Equivalents: The Company considers all highly liquid investments with maturities of ninety days or less when purchased to be cash equivalents. |
Allowance for Doubtful Accounts | Allowance for Doubtful Accounts: In the normal course of business, the Company extends credit to its customers on a short-term basis. Although credit risks associated with our customers are considered minimal, the Company routinely reviews its accounts receivable balances and makes provisions for probable doubtful accounts based on an individual assessment of a customer’s credit quality as well as subjective factors and trends, including the aging of receivable balances. In circumstances where management is aware of a specific customer’s inability to meet its financial obligations to the Company, a specific reserve is recorded to reduce the receivable to the amount expected to be collected. If circumstances change (i.e., higher than expected defaults or an unexpected material adverse change in a major customer’s ability to meet its financial obligations to us), our estimates of the recoverability of amounts due us could be reduced by a material amount and the allowance for doubtful accounts and related bad debt expense would increase by the same amount. |
Inventories | Inventories: Processed and prepared inventories and inventories of feed, eggs, medication and packaging supplies are stated at the lower of cost (average method) or market value. Live poultry inventories of broilers are stated at the lower of cost or market value and breeders at cost less accumulated amortization. The costs associated with breeders, including breeder chicks, feed, medicine and grower pay, are accumulated up to the production stage and amortized over nine months using the straight-line method. When the projected cost to complete, process and sell broilers in live inventory exceeds the expected market value for the finished product, the Company reduces the value of live inventories from cost to market. |
Property, Plant and Equipment | Property, Plant and Equipment: Property, plant and equipment is stated at cost. Depreciation of property, plant and equipment is provided by the straight-line method over the estimated useful lives of 15 to 39 years for buildings and 3 to 12 years for machinery and equipment. |
Impairment of Long-Lived Assets | Impairment of Long-Lived Assets: The Company continually reevaluates the carrying value of its long-lived assets based on events or changes in circumstances which indicate that the carrying value may not be recoverable. As part of this reevaluation and when indicators are present, the Company estimates the future cash flows expected to result from the use of the asset and its eventual disposal. If the sum of the expected future cash flows (undiscounted and without interest charges) is less than the carrying amount of the asset, an impairment loss, based on the fair value of the assets, is recognized through a charge to operations. |
Self-Insurance Programs | Self-Insurance Programs: Insurance expense for workers’ compensation benefits and employee-related health care benefits are estimated using historical experience and actuarial estimates. The Company accrues expenses in its workers’ compensation and employee benefit plans for both known claims as well as claims incurred but not reported. Stop-loss coverage is maintained with third party insurers to limit the Company’s total exposure. Management regularly reviews the assumptions used to recognize periodic expenses. Any resulting adjustments to accrued claims are reflected in current operating results. There are no material adjustments to expenses accrued in prior periods in current expenses. If historical experience proves not to be a good indicator of future expenses, if management were to use different actuarial assumptions, or if there is a negative trend in the Company’s claims history, there could be a significant increase or decrease in cost of sales depending on whether these expenses increased or decreased, respectively. |
Advertising and Marketing Costs | Advertising and Marketing Costs: The Company expenses advertising costs as incurred. |
Income Taxes | Income Taxes: Deferred income taxes are accounted for using the liability method and relate principally to depreciation expense, stock based compensation programs and self-insurance programs accounted for differently for financial and income tax purposes. During fiscal 2016, the Company retrospectively adopted Accounting Standards Update No. 2015-17, "Income Taxes - Balance Sheet Classification of Deferred Taxes," which requires an entity to classify all deferred tax assets and liabilities as noncurrent. Refer to the "Impact of Recently Issued Accounting Standards" sub-section below for a description of the resulting reclassification to the related balance sheet items previously reported as of October 31, 2015. Valuation allowances are recorded when it is more likely than not some or all of a deferred tax asset will not be realized. The Company is periodically audited by taxing authorities and considers any adjustments, interest, and penalties incurred as a result of the audits in computing and reporting income tax expense. Any audit adjustments could have a material impact on the Company’s effective tax rate. Tax periods for fiscal years 2013 through 2016 remain open to examination by federal and state taxing jurisdictions to which the Company is subject. |
Share-Based Compensation | Share-Based Compensation: The Company accounts for all share-based payments to employees, including grants of restricted stock and performance-based shares, in the income statement based on their fair values. For performance-based shares, the Company recognizes expense when management determines the performance criteria are probable of being met. |
Earnings Per Share | Earnings Per Share: Basic earnings per share is based upon the weighted average number of common shares outstanding during the year. Share-based payment awards entitling holders to receive non-forfeitable dividends before vesting are considered participating securities and thus included in the calculation of basic earnings per share. These awards are included in the calculation of basic earnings per share under the two-class method. The two-class method allocates earnings for the period between common shareholders and other security holders. The participating awards receiving dividends are allocated the same amount of income as if they were outstanding shares. Diluted earnings per share includes any dilutive effects of options, warrants, restricted stock and convertible securities. |
Fair Value of Financial Instruments | Fair Value of Financial Instruments: The Company sometimes holds certain items that are required to be disclosed at fair value, primarily cash equivalents and debt instruments. Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. A three-level hierarchy is followed for disclosure to show the extent and level of judgment used to estimate fair value measurements: Level 1 – Inputs used to measure fair value are unadjusted quoted prices that are available in active markets for the identical assets or liabilities as of the reporting date. Level 2 – Inputs used to measure fair value, other than quoted prices included in Level 1, are either directly or indirectly observable as of the reporting date through correlation with market data, including quoted prices for similar assets and liabilities in active markets and quoted prices in markets that are not active. Level 2 also includes assets and liabilities that are valued using models or other pricing methodologies that do not require significant judgment since the input assumptions used in the models, such as interest rates and volatility factors, are corroborated by readily observable data from actively quoted markets for substantially the full term of the financial instrument. Level 3 – Inputs used to measure fair value are unobservable inputs that are supported by little or no market activity and reflect the use of significant management judgment. These values are generally determined using pricing models for which the assumptions utilize management’s estimates of market participant assumptions. |
Impact of Recently Issued Accounting Standards | Impact of Recently Issued Accounting Standards: In March 2016, the FASB issued guidance requiring all income tax effects of stock awards to be recognized in the statement of operations when the awards vest or are settled rather than recording excess tax benefits or deficiencies in additional paid-in capital. Additionally, classification of the related amounts in the statement of cash flows will be recognized within operating activities, rather than financing activities. The guidance also changes accounting for an employee's use of shares to satisfy the employer's statutory tax withholding obligation and for forfeitures. The standard becomes effective for interim and annual periods beginning after December 15, 2016, our fiscal 2018. Early adoption is permitted. The effect of this new standard’s provisions on excess tax benefits or deficiencies in our consolidated financial statements will depend on the changes in the Company’s stock prices at vesting dates and grant dates for awards that vest after adoption. The changes in amounts repurchased for tax withholding purposes and changes in the accounting for forfeitures are not expected to have a material effect on our consolidated financial statements. In February 2016, the FASB issued guidance which is intended to increase transparency and comparability among companies by requiring an entity that is a lessee to recognize on the balance sheet the right-of-use assets and lease liabilities arising from all leases with terms, as defined by the guidance, of greater than twelve months. The guidance also requires disclosures of key information about the leasing arrangements. The guidance is effective for annual reporting periods and interim periods within those annual reporting periods beginning after December 15, 2018, our fiscal 2020. Early adoption is permitted. The Company is currently evaluating the impact this guidance will have on our consolidated financial statements. In November 2015, the FASB issued guidance that requires an entity to classify all deferred tax assets and liabilities as noncurrent. The standard is effective for fiscal years beginning after December 15, 2016, our fiscal 2018, and interim periods within those years. Early adoption is permitted. The Company adopted this standard, retrospectively, as of October 31, 2016. The changes in the effected income tax related balance sheet accounts at the prior year end were as follows: October 31, 2015 Prior to Adoption (previously reported) Effects of Adoption As Adopted (currently reported) Current Assets Current Deferred Income Taxes $ 4,709 $ (4,709 ) $ — Non-current Liabilities Deferred Income Taxes $ 52,234 $ (4,709 ) $ 47,525 In July 2015, the FASB issued guidance that requires an entity to measure inventory at the lower of cost or net realizable value. The guidance is effective for annual reporting periods and interim periods within those annual reporting periods beginning after December 15, 2016, our fiscal 2018. Early adoption is permitted and the prospective transition method should be applied. The Company is currently evaluating the impact this guidance will have on our consolidated financial statements. In April 2015, the FASB issued guidance requiring that debt issuance costs related to a recognized debt liability be presented in the balance sheet as a direct deduction from the carrying amount of that debt liability, consistent with debt discounts. The recognition and measurement guidance for debt issuance costs are not affected by the amendments in the new standard. The standard requires retrospective application and will be effective for financial statements issued for fiscal years beginning after December 15, 2015, our fiscal year 2017, and interim periods within those fiscal years. Early adoption is permitted. The Company does not believe adoption will have a material effect on our consolidated financial statements. In May 2014, the FASB issued guidance changing the criteria for recognizing revenue, which was amended in 2015 to defer the effective date by one year. The guidance also modifies the related disclosure requirements, clarifies guidance for multiple-element arrangements and provides guidance for transactions that were not addressed fully in previous guidance. The guidance, as amended, is effective for annual reporting periods and interim periods within those annual reporting periods beginning after December 15, 2017, our fiscal 2019. Early adoption is permitted for annual reporting periods and interim periods within those annual reporting periods beginning after December 15, 2016. The Company is currently evaluating the impact this guidance will have on our consolidated financial statements. |
Significant Accounting Polici21
Significant Accounting Policies (Tables) | 12 Months Ended |
Oct. 31, 2016 | |
Accounting Policies [Abstract] | |
Reconciliation of Gross Sales to Net Sales | RECONCILIATION OF GROSS SALES TO NET SALES DOLLARS (in millions) Product Category Description Fiscal Year 2016 Fiscal Year 2015 Fiscal Year 2014 Fresh Ice Packed Chicken Gross Sales $ 438.5 $ 399.1 $ 336.7 Commissions (4.2 ) (4.1 ) (3.7 ) Sales and Customer Allowances (14.1 ) (12.8 ) (11.2 ) Other (1) (13.5 ) (13.5 ) (8.5 ) Net Sales 406.7 368.7 313.3 Chill Pack Chicken Gross Sales 999.9 1,057.6 1,025.3 Commissions (4.4 ) (4.6 ) (5.5 ) Sales and Customer Allowances (5.7 ) (6.5 ) (8.7 ) Other (1) (5.6 ) (5.3 ) (5.4 ) Net Sales 984.2 1,041.2 1,005.7 Frozen Chicken Gross Sales 144.0 178.3 257.9 Commissions — (0.1 ) (0.3 ) Sales and Customer Allowances — — — Other (1) (0.5 ) (0.6 ) (1.9 ) Net Sales 143.5 177.6 255.7 Fresh Vacuum Sealed Chicken Gross Sales 1,085.7 1,010.6 1,026.8 Commissions (1.9 ) (1.7 ) (1.8 ) Sales and Customer Allowances (9.4 ) (9.0 ) (9.1 ) Other (1) (7.5 ) (7.7 ) (6.7 ) Net Sales 1,066.9 992.2 1,009.2 Minimally Prepared Chicken Gross Sales 186.0 187.7 155.7 Commissions (0.4 ) (0.5 ) (0.7 ) Sales and Customer Allowances (0.2 ) (0.1 ) (0.5 ) Other (1) (0.3 ) (0.3 ) (0.2 ) Net Sales 185.1 186.8 154.3 Mechanically Deboned Chicken Gross Sales 29.7 37.0 36.6 Commissions — — — Sales and Customer Allowances — — — Other (1) — — — Net Sales 29.7 37.0 36.6 Totals Gross Sales 2,883.8 2,870.3 2,839.0 Commissions (10.9 ) (11.0 ) (12.0 ) Sales and Customer Allowances (29.4 ) (28.4 ) (29.5 ) Other (1) (27.4 ) (27.4 ) (22.7 ) Net Sales $ 2,816.1 $ 2,803.5 $ 2,774.8 (1) Other deductions include short weights, miscellaneous deductions, credit memos, rebates and other items. |
Fair Value and Carrying Value of Borrowings Under Long-Term Debt | The fair value and carrying value of the Company’s borrowings under its long-term debt were as follows: October 31, 2016 October 31, 2015 Fair Value Carrying Value Fair Value Carrying Value Total Debt (In millions) $ — $ — $ 10.2 $ 10.0 |
Schedule of Error Corrections and Prior Period Adjustments | The changes in the effected income tax related balance sheet accounts at the prior year end were as follows: October 31, 2015 Prior to Adoption (previously reported) Effects of Adoption As Adopted (currently reported) Current Assets Current Deferred Income Taxes $ 4,709 $ (4,709 ) $ — Non-current Liabilities Deferred Income Taxes $ 52,234 $ (4,709 ) $ 47,525 |
Inventories (Tables)
Inventories (Tables) | 12 Months Ended |
Oct. 31, 2016 | |
Inventory Disclosure [Abstract] | |
Inventories | Inventories consisted of the following: October 31, 2016 2015 (In thousands) Live poultry-broilers and breeders $ 143,554 $ 131,984 Feed, eggs and other 40,834 37,109 Processed poultry 15,378 10,158 Prepared chicken 13,640 11,927 Packaging materials 6,900 7,575 $ 220,306 $ 198,753 |
Prepaid expenses (Tables)
Prepaid expenses (Tables) | 12 Months Ended |
Oct. 31, 2016 | |
Prepaid Expense, Current [Abstract] | |
Prepaid Expenses | Prepaid expenses consisted of the following: October 31, 2016 2015 (In thousands) Parts and supplies $ 23,022 $ 21,332 Prepaid insurance 6,084 7,385 Other prepaid expenses 5,453 4,614 $ 34,559 $ 33,331 |
Accrued expenses (Tables)
Accrued expenses (Tables) | 12 Months Ended |
Oct. 31, 2016 | |
Payables and Accruals [Abstract] | |
Accrued expenses | Accrued expenses consisted of the following: October 31, 2016 2015 (In thousands) Accrued bonuses $ 441 $ 30,360 Workers’ compensation claims 7,971 7,813 Accrued wages 8,415 6,169 Accrued rebates 6,761 6,347 Accrued vacation 6,721 5,999 Accrued property taxes 8,710 6,965 Product recall — 4,153 Accrued payroll taxes 9,209 9,991 Other accrued expenses 9,690 10,634 $ 57,918 $ 88,431 |
Long-Term debt obligations (Tab
Long-Term debt obligations (Tables) | 12 Months Ended |
Oct. 31, 2016 | |
Debt Disclosure [Abstract] | |
Long-Term Debt Obligations | Long-term debt obligations consisted of the following: October 31, 2016 2015 (In thousands) Term loan, accruing interest at 6.12%, matured in 2016 — 10,000 — 10,000 Less current maturities of long-term debt — 10,000 $ — $ — |
Leverage Ratio on which Spread on Libor Borrowings and Commitment Fee for Unused Balance of Revolving Credit Agreement are Determined | The spread on Libor borrowings and the commitment fee for the unused balance of the revolving credit agreement are determined based upon the Company’s leverage ratio as follows: Level Leverage Ratio Spread Commitment Fee 1 < 25% 0.25 % 0.20 % 2 ≥ 25% and < 35% 0.50 % 0.25 % 3 ≥ 35% and < 45% 1.00 % 0.30 % 4 ≥ 45% 1.50 % 0.35 % |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Oct. 31, 2016 | |
Income Tax Disclosure [Abstract] | |
Income Tax Expense | Income tax expense consisted of the following: Years Ended October 31, 2016 2015 2014 (In thousands) Current expense: Federal $ 67,880 $ 101,605 $ 127,519 State 7,613 11,704 12,766 75,493 113,309 140,285 Deferred expense (benefit): Federal 27,983 4,169 (8,769 ) State 1,194 1,043 577 Change in valuation allowance (954 ) (431 ) (1,675 ) 28,223 4,781 (9,867 ) $ 103,716 $ 118,090 $ 130,418 |
Deferred Tax Assets and Liabilities | Significant components of the Company’s deferred tax assets and liabilities are outlined below. During fiscal 2016, the Company retrospectively adopted Accounting Standards Update No. 2015-17, "Income Taxes - Balance Sheet Classification of Deferred Taxes," which requires an entity to classify all deferred tax assets and liabilities as noncurrent. Refer to the "Impact of Recently Issued Accounting Standards" sub-section of the Significant Accounting Policies footnote for a description of the resulting reclassification to the related balance sheet items previously reported as of October 31, 2015. October 31, 2016 2015 (In thousands) Deferred tax liabilities: Property, plant and equipment $ 96,027 $ 67,923 Prepaid and other assets 2,243 2,248 Total deferred tax liabilities 98,270 70,171 Deferred tax assets: Accrued expenses and accounts receivable 10,572 10,091 Inventory 493 219 Compensation on restricted stock 10,591 11,820 State income tax credits 15,229 15,833 Other 166 166 Valuation allowance (14,529 ) (15,483 ) Total deferred tax assets 22,522 22,646 Net deferred tax liabilities $ 75,748 $ 47,525 |
Differences Between Consolidated Effective Income Tax Rate and Federal Statutory Rate | The differences between the consolidated effective income tax rate and the federal statutory rate of 35.0% are as follows: Years Ended October 31, 2016 2015 2014 (In thousands) Income taxes at statutory rate $ 102,437 $ 116,932 $ 132,813 State income taxes 7,007 8,757 9,450 State income tax credits (948 ) (342 ) (191 ) Federal income tax credits (390 ) (90 ) (97 ) Federal manufacturers deduction (8,425 ) (10,714 ) (12,636 ) Nondeductible expenses 2,482 3,234 2,909 Other, net 2,507 744 (155 ) Change in valuation allowance (954 ) (431 ) (1,675 ) Income tax expense $ 103,716 $ 118,090 $ 130,418 |
Earnings Per Share (Tables)
Earnings Per Share (Tables) | 12 Months Ended |
Oct. 31, 2016 | |
Earnings Per Share [Abstract] | |
Earnings Per Share | The following table presents earnings per share (in thousands). For the years ended October 31, 2016 October 31, 2015 October 31, 2014 Net income $ 188,961 $ 216,001 $ 249,048 Distributed and undistributed (earnings) to unvested restricted stock (2,930 ) (4,172 ) (6,781 ) Distributed and undistributed earnings to common shareholders — Basic 186,031 211,829 242,267 Weighted average shares outstanding — Basic 22,225 22,243 22,441 Weighted average shares outstanding — Diluted 22,225 22,243 22,441 Earnings per common share — Basic $ 8.37 $ 9.52 $ 10.80 Earnings per common share — Diluted $ 8.37 $ 9.52 $ 10.80 |
Stock Compensation Plans (Table
Stock Compensation Plans (Tables) | 12 Months Ended |
Oct. 31, 2016 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Restricted Stock Activity | A summary of the Company’s restricted stock activity and related information is as follows: Number of Shares Weighted Average Grant Price Outstanding at October 31, 2013 568,625 $ 44.85 Granted during fiscal 2014 98,925 $ 67.26 Vested during 2014 (84,601 ) $ 40.22 Forfeited during 2014 (16,899 ) $ 47.20 Outstanding at October 31, 2014 566,050 $ 49.39 Granted during fiscal 2015 77,600 $ 82.75 Vested during 2015 (327,988 ) $ 44.98 Forfeited during 2015 (1,362 ) $ 62.15 Outstanding at October 31, 2015 314,300 $ 62.16 Granted during fiscal 2016 101,935 $ 71.58 Vested during 2016 (119,407 ) $ 54.09 Forfeited during 2016 (3,018 ) $ 67.82 Outstanding at October 31, 2016 293,810 $ 68.65 |
Compensation Cost Related to Performance Share Agreements | A summary of the Company's compensation cost related to performance share agreements is as follows (in thousands): Number of shares issued (actual (a) or estimated (e)) For the years ended Date of Performance Share Agreement October 31, 2016 October 31, 2015 October 31, 2014 November 1, 2011 102,534 (a) $ — $ — $ 1,543 November 1, 2012 186,951 (a) — 2,891 5,823 November 1, 2013 146,169 (a) 3,165 6,428 — November 1, 2014 103,974 (e) 5,876 — — November 1, 2015 — — — — Total compensation cost $ 9,041 $ 9,319 $ 7,366 |
Commitments and Contingencies (
Commitments and Contingencies (Tables) | 12 Months Ended |
Oct. 31, 2016 | |
Commitments and Contingencies Disclosure [Abstract] | |
Minimum Lease Payments of Obligations Under Non-Cancelable Operating Leases | The minimum lease payments of obligations under non-cancelable operating leases at October 31, 2016 were as follows (in millions): Fiscal Year Amount 2017 $ 11.5 2018 10.8 2019 6.5 2020 3.8 2021 1.5 $ 34.1 |
Quarterly Financial Data (una30
Quarterly Financial Data (unaudited) (Tables) | 12 Months Ended |
Oct. 31, 2016 | |
Quarterly Financial Information Disclosure [Abstract] | |
Schedule of Quarterly Financial Data (unaudited) | Fiscal Year 2016 First Quarter Second Quarter Third Quarter Fourth Quarter (In thousands, except per share data) (Unaudited) Net sales $ 605,166 $ 692,089 $ 727,991 $ 790,811 Gross profit 50,105 113,813 129,428 160,655 Net income 10,681 47,602 54,716 75,962 Diluted earnings per share $ 0.47 $ 2.11 $ 2.42 $ 3.36 Fiscal Year 2015 First Quarter Second Quarter Third Quarter Fourth Quarter (In thousands, except per share data) (unaudited) Net sales $ 667,363 $ 716,592 $ 739,933 $ 679,592 Gross profit 141,162 139,025 127,172 83,753 Net income 66,503 71,246 50,881 27,371 Diluted earnings per share $ 2.87 $ 3.13 $ 2.27 $ 1.22 |
Significant Accounting Polici31
Significant Accounting Policies - Additional Information (Detail) $ in Millions | 12 Months Ended | ||
Oct. 31, 2016USD ($)customer | Oct. 31, 2015USD ($)customer | Oct. 31, 2014USD ($)customer | |
Significant Accounting Policies [Line Items] | |||
Gross sales | $ 2,883.8 | $ 2,870.3 | $ 2,839 |
Amortization period for costs associated with breeders | 9 months | ||
Capitalized interest | $ 0.3 | 0.5 | 1.1 |
Advertising costs | $ 25.1 | 13.1 | 12.9 |
Building | Minimum | |||
Significant Accounting Policies [Line Items] | |||
Property plant and equipment, estimated useful life | 15 years | ||
Building | Maximum | |||
Significant Accounting Policies [Line Items] | |||
Property plant and equipment, estimated useful life | 39 years | ||
Machinery and Equipment | Minimum | |||
Significant Accounting Policies [Line Items] | |||
Property plant and equipment, estimated useful life | 3 years | ||
Machinery and Equipment | Maximum | |||
Significant Accounting Policies [Line Items] | |||
Property plant and equipment, estimated useful life | 12 years | ||
Cash Equivalents | Maximum | |||
Significant Accounting Policies [Line Items] | |||
Highly liquid investments included as cash equivalents, maximum maturities | 90 days | ||
Outside United States | |||
Significant Accounting Policies [Line Items] | |||
Gross sales | $ 213.5 | 207.8 | 282.3 |
Offal | |||
Significant Accounting Policies [Line Items] | |||
Gross sales | $ 27.8 | $ 31.2 | $ 43.1 |
Sales | |||
Significant Accounting Policies [Line Items] | |||
Percentage of revenue from a single major customer | 17.50% | 16.20% | 15.90% |
Individual Customer | Customer Concentration Risk | |||
Significant Accounting Policies [Line Items] | |||
Number of customer accounted for more than 10% of consolidated sales | customer | 1 | 1 | 1 |
Significant Accounting Polici32
Significant Accounting Policies - Reconciliation of Gross Sales to Net Sales (Detail) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | ||||||||||
Oct. 31, 2016 | Jul. 31, 2016 | Apr. 30, 2016 | Jan. 31, 2016 | Oct. 31, 2015 | Jul. 31, 2015 | Apr. 30, 2015 | Jan. 31, 2015 | Oct. 31, 2016 | Oct. 31, 2015 | Oct. 31, 2014 | ||
Revenue from External Customer [Line Items] | ||||||||||||
Gross Sales | $ 2,883,800 | $ 2,870,300 | $ 2,839,000 | |||||||||
Commissions | (10,900) | (11,000) | (12,000) | |||||||||
Sales and Customer Allowances | (29,400) | (28,400) | (29,500) | |||||||||
Other | [1] | (27,400) | (27,400) | (22,700) | ||||||||
Net Sales | $ 790,811 | $ 727,991 | $ 692,089 | $ 605,166 | $ 679,592 | $ 739,933 | $ 716,592 | $ 667,363 | 2,816,057 | 2,803,480 | 2,774,845 | |
Fresh Ice Packed Chicken | ||||||||||||
Revenue from External Customer [Line Items] | ||||||||||||
Gross Sales | 438,500 | 399,100 | 336,700 | |||||||||
Commissions | (4,200) | (4,100) | (3,700) | |||||||||
Sales and Customer Allowances | (14,100) | (12,800) | (11,200) | |||||||||
Other | [1] | (13,500) | (13,500) | (8,500) | ||||||||
Net Sales | 406,700 | 368,700 | 313,300 | |||||||||
Chill Pack Chicken | ||||||||||||
Revenue from External Customer [Line Items] | ||||||||||||
Gross Sales | 999,900 | 1,057,600 | 1,025,300 | |||||||||
Commissions | (4,400) | (4,600) | (5,500) | |||||||||
Sales and Customer Allowances | (5,700) | (6,500) | (8,700) | |||||||||
Other | [1] | (5,600) | (5,300) | (5,400) | ||||||||
Net Sales | 984,200 | 1,041,200 | 1,005,700 | |||||||||
Frozen Chicken | ||||||||||||
Revenue from External Customer [Line Items] | ||||||||||||
Gross Sales | 144,000 | 178,300 | 257,900 | |||||||||
Commissions | 0 | (100) | (300) | |||||||||
Sales and Customer Allowances | 0 | 0 | 0 | |||||||||
Other | [1] | (500) | (600) | (1,900) | ||||||||
Net Sales | 143,500 | 177,600 | 255,700 | |||||||||
Fresh Vacuum Sealed Chicken | ||||||||||||
Revenue from External Customer [Line Items] | ||||||||||||
Gross Sales | 1,085,700 | 1,010,600 | 1,026,800 | |||||||||
Commissions | (1,900) | (1,700) | (1,800) | |||||||||
Sales and Customer Allowances | (9,400) | (9,000) | (9,100) | |||||||||
Other | [1] | (7,500) | (7,700) | (6,700) | ||||||||
Net Sales | 1,066,900 | 992,200 | 1,009,200 | |||||||||
Minimally Prepared Chicken | ||||||||||||
Revenue from External Customer [Line Items] | ||||||||||||
Gross Sales | 186,000 | 187,700 | 155,700 | |||||||||
Commissions | (400) | (500) | (700) | |||||||||
Sales and Customer Allowances | (200) | (100) | (500) | |||||||||
Other | [1] | (300) | (300) | (200) | ||||||||
Net Sales | 185,100 | 186,800 | 154,300 | |||||||||
Mechanically Deboned Chicken | ||||||||||||
Revenue from External Customer [Line Items] | ||||||||||||
Gross Sales | 29,700 | 37,000 | 36,600 | |||||||||
Commissions | 0 | 0 | 0 | |||||||||
Sales and Customer Allowances | 0 | 0 | 0 | |||||||||
Other | [1] | 0 | 0 | 0 | ||||||||
Net Sales | $ 29,700 | $ 37,000 | $ 36,600 | |||||||||
[1] | Other deductions include short weights, miscellaneous deductions, credit memos, rebates and other items. |
Significant Accounting Polici33
Significant Accounting Policies - Fair Value and Carrying Value of Borrowings Under Credit Facilities Long-Term Debt and Capital Lease Obligations (Detail) - Fair Value, Inputs, Level 2 - USD ($) $ in Millions | Oct. 31, 2016 | Oct. 31, 2015 |
Fair Value | ||
Fair Value and Carrying Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Total Debt | $ 0 | $ 10.2 |
Carrying Value | ||
Fair Value and Carrying Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Total Debt | $ 0 | $ 10 |
Significant Accounting Polici34
Significant Accounting Policies - Adjustments to Prior Period Disclosures (Details) $ in Thousands | Oct. 31, 2015USD ($) |
Current Assets | |
Current Deferred Income Taxes | $ 0 |
Non-current Liabilities | |
Deferred Income Taxes | 47,525 |
Prior to Adoption (previously reported) | |
Current Assets | |
Current Deferred Income Taxes | 4,709 |
Non-current Liabilities | |
Deferred Income Taxes | 52,234 |
Effects of Adoption | |
Current Assets | |
Current Deferred Income Taxes | (4,709) |
Non-current Liabilities | |
Deferred Income Taxes | $ (4,709) |
Inventories (Detail)
Inventories (Detail) - USD ($) $ in Thousands | Oct. 31, 2016 | Oct. 31, 2015 |
Inventory [Line Items] | ||
Inventories | $ 220,306 | $ 198,753 |
Live poultry-broilers and breeders | ||
Inventory [Line Items] | ||
Inventories | 143,554 | 131,984 |
Feed, eggs and other | ||
Inventory [Line Items] | ||
Inventories | 40,834 | 37,109 |
Processed poultry | ||
Inventory [Line Items] | ||
Inventories | 15,378 | 10,158 |
Prepared chicken | ||
Inventory [Line Items] | ||
Inventories | 13,640 | 11,927 |
Packaging materials | ||
Inventory [Line Items] | ||
Inventories | $ 6,900 | $ 7,575 |
Prepaid expenses (Detail)
Prepaid expenses (Detail) - USD ($) $ in Thousands | Oct. 31, 2016 | Oct. 31, 2015 |
Prepaid Expense, Current [Abstract] | ||
Parts and supplies | $ 23,022 | $ 21,332 |
Prepaid insurance | 6,084 | 7,385 |
Other prepaid expenses | 5,453 | 4,614 |
Prepaid expenses, total | $ 34,559 | $ 33,331 |
Accrued expenses (Detail)
Accrued expenses (Detail) - USD ($) $ in Thousands | Oct. 31, 2016 | Oct. 31, 2015 |
Payables and Accruals [Abstract] | ||
Accrued bonuses | $ 441 | $ 30,360 |
Workers’ compensation claims | 7,971 | 7,813 |
Accrued wages | 8,415 | 6,169 |
Accrued rebates | 6,761 | 6,347 |
Accrued vacation | 6,721 | 5,999 |
Accrued property taxes | 8,710 | 6,965 |
Product recall | 0 | 4,153 |
Accrued payroll taxes | 9,209 | 9,991 |
Other accrued expenses | 9,690 | 10,634 |
Accrued expenses, total | $ 57,918 | $ 88,431 |
Long-Term debt obligations (Det
Long-Term debt obligations (Detail) - USD ($) $ in Thousands | 12 Months Ended | |
Oct. 31, 2016 | Oct. 31, 2015 | |
Debt Instrument [Line Items] | ||
Debt obligations | $ 0 | $ 10,000 |
Less current maturities of long-term debt | 0 | 10,000 |
Long-term debt, less current maturities | 0 | 0 |
Term Loan Facility | ||
Debt Instrument [Line Items] | ||
Term loan, accruing interest at 6.12%, matured in 2016 | $ 0 | $ 10,000 |
Long-term debt, interest rate, stated percentage | 6.12% | 6.12% |
Long-term debt, maturity year | 2,016 | 2,016 |
Long-Term debt obligations - Ad
Long-Term debt obligations - Additional Information (Detail) | 12 Months Ended | |||
Oct. 31, 2016USD ($) | Oct. 31, 2015USD ($) | Dec. 08, 2016USD ($) | Apr. 24, 2015USD ($) | |
Debt Instrument [Line Items] | ||||
Revolving credit facility, maximum debt to total capitalization ratio, increase available | 0.05 | |||
Term Loan Facility | ||||
Debt Instrument [Line Items] | ||||
Term loan, unsecured private placement | $ 0 | $ 10,000,000 | ||
Long-term debt, maturity | 2,016 | 2,016 | ||
2,018 | ||||
Debt Instrument [Line Items] | ||||
Revolving credit facility, permitted carry over of capital expenditure limitation | $ 15,000,000 | |||
2,019 | ||||
Debt Instrument [Line Items] | ||||
Revolving credit facility, permitted carry over of capital expenditure limitation | 15,000,000 | |||
2,020 | ||||
Debt Instrument [Line Items] | ||||
Revolving credit facility, permitted carry over of capital expenditure limitation | 15,000,000 | |||
Revolving Credit Facility | ||||
Debt Instrument [Line Items] | ||||
Revolving credit facility, maximum borrowing capacity | 750,000,000 | |||
Revolving credit facility, capital expenditure limitation | $ 115,000,000 | |||
Revolving credit facility, maximum debt to total capitalization ratio | 0.5 | |||
Revolving credit facility, maximum debt to total capitalization ratio, increase available | 0.05 | |||
Revolving credit facility, minimum net worth requirement | $ 833,100,000 | |||
Revolving credit facility, outstanding borrowings | 0 | |||
Line of credit facility, amount available | $ 733,700,000 | |||
Revolving Credit Facility | Maximum | ||||
Debt Instrument [Line Items] | ||||
Revolving credit facility, capital expenditure limitation | $ 100,000,000 | |||
Revolving Credit Facility | London Interbank Offered Rate (LIBOR) | Minimum | ||||
Debt Instrument [Line Items] | ||||
Interest rate | 0.25% | |||
Revolving Credit Facility | London Interbank Offered Rate (LIBOR) | Maximum | ||||
Debt Instrument [Line Items] | ||||
Interest rate | 1.50% | |||
Revolving Credit Facility | Subsequent event | ||||
Debt Instrument [Line Items] | ||||
Revolving credit facility, outstanding borrowings | $ 0 | |||
Line of credit facility, amount available | 733,700,000 | |||
Revolving Credit Facility | Aircraft Expenditure | ||||
Debt Instrument [Line Items] | ||||
Revolving credit facility, capital expenditure limitation | 15,000,000 | |||
Revolving Credit Facility | St. Pauls, North Carolina | Construction Expenditure Limitation | ||||
Debt Instrument [Line Items] | ||||
Revolving credit facility, construction expenditure limitation | 160,000,000 | |||
Revolving Credit Facility | Unknown | Construction Expenditure Limitation | ||||
Debt Instrument [Line Items] | ||||
Revolving credit facility, construction expenditure limitation | 175,000,000 | |||
Revolving Credit Facility | 2017 | ||||
Debt Instrument [Line Items] | ||||
Revolving credit facility, capital expenditure limitation | 100,000,000 | |||
Revolving credit facility, permitted carry over of capital expenditure limitation | 15,000,000 | |||
Revolving Credit Facility | 2018 | ||||
Debt Instrument [Line Items] | ||||
Revolving credit facility, capital expenditure limitation | 100,000,000 | |||
Revolving Credit Facility | 2019 | ||||
Debt Instrument [Line Items] | ||||
Revolving credit facility, capital expenditure limitation | 100,000,000 | |||
Revolving Credit Facility | 2020 | ||||
Debt Instrument [Line Items] | ||||
Revolving credit facility, capital expenditure limitation | $ 100,000,000 | |||
Letter of Credit | ||||
Debt Instrument [Line Items] | ||||
Revolving credit facility, outstanding borrowings | $ 16,300,000 | |||
Letter of Credit | Subsequent event | ||||
Debt Instrument [Line Items] | ||||
Revolving credit facility, outstanding borrowings | $ 16,300,000 |
Long-Term debt obligations - Le
Long-Term debt obligations - Leverage Ratio on which Spread on Libor Borrowings and Commitment Fee for Unused Balance of Revolving Credit Agreement are Determined (Detail) | 12 Months Ended |
Oct. 31, 2016 | |
25% | |
Line of Credit Facility [Line Items] | |
Spread | 0.25% |
Commitment Fee | 0.20% |
≥ 25% and 35% | |
Line of Credit Facility [Line Items] | |
Spread | 0.50% |
Commitment Fee | 0.25% |
≥ 35% and 45% | |
Line of Credit Facility [Line Items] | |
Spread | 1.00% |
Commitment Fee | 0.30% |
≥ 45% | |
Line of Credit Facility [Line Items] | |
Spread | 1.50% |
Commitment Fee | 0.35% |
Income Taxes - Income Tax Expen
Income Taxes - Income Tax Expense (Detail) - USD ($) $ in Thousands | 12 Months Ended | ||
Oct. 31, 2016 | Oct. 31, 2015 | Oct. 31, 2014 | |
Current expense: | |||
Federal | $ 67,880 | $ 101,605 | $ 127,519 |
State | 7,613 | 11,704 | 12,766 |
Current income tax expense | 75,493 | 113,309 | 140,285 |
Deferred expense (benefit): | |||
Federal | 27,983 | 4,169 | (8,769) |
State | 1,194 | 1,043 | 577 |
Change in valuation allowance | (954) | (431) | (1,675) |
Deferred income tax expense | 28,223 | 4,781 | (9,867) |
Income tax expense | $ 103,716 | $ 118,090 | $ 130,418 |
Income Taxes - Deferred Tax Ass
Income Taxes - Deferred Tax Assets and Liabilities (Detail) - USD ($) $ in Thousands | Oct. 31, 2016 | Oct. 31, 2015 |
Deferred tax liabilities: | ||
Property, plant and equipment | $ 96,027 | $ 67,923 |
Prepaid and other assets | 2,243 | 2,248 |
Total deferred tax liabilities | 98,270 | 70,171 |
Deferred tax assets: | ||
Accrued expenses and accounts receivable | 10,572 | 10,091 |
Inventory | 493 | 219 |
Compensation on restricted stock | 10,591 | 11,820 |
State income tax credits | 15,229 | 15,833 |
Other | 166 | 166 |
Valuation allowance | (14,529) | (15,483) |
Total deferred tax assets | 22,522 | 22,646 |
Net deferred tax liabilities | $ 75,748 | $ 47,525 |
Income Taxes - Additional Infor
Income Taxes - Additional Information (Detail) - USD ($) $ in Thousands | 12 Months Ended | ||
Oct. 31, 2016 | Oct. 31, 2015 | Oct. 31, 2014 | |
Income Taxes [Line Items] | |||
Deferred tax assets, job tax credit | $ 15,229 | $ 15,833 | |
Recorded valuation allowance | 14,529 | 15,483 | |
Release from valuation allowance | $ 700 | $ 350 | $ 633 |
Federal statutory rate | 35.00% | ||
North Carolina | |||
Income Taxes [Line Items] | |||
Deferred tax assets, job tax credit | $ 12,351 | ||
Investment tax credit provided by Investing in Business Property Credit | 7.00% | ||
Georgia | |||
Income Taxes [Line Items] | |||
Deferred tax assets, job tax credit | $ 2,878 |
Income Taxes - Differences Betw
Income Taxes - Differences Between Consolidated Effective Income Tax Rate and Federal Statutory Rate (Detail) - USD ($) $ in Thousands | 12 Months Ended | ||
Oct. 31, 2016 | Oct. 31, 2015 | Oct. 31, 2014 | |
Reconciliation of Provision of Income Taxes [Line Items] | |||
Income taxes at statutory rate | $ 102,437 | $ 116,932 | $ 132,813 |
State income taxes | 7,007 | 8,757 | 9,450 |
Federal manufacturers deduction | (8,425) | (10,714) | (12,636) |
Nondeductible expenses | 2,482 | 3,234 | 2,909 |
Other, net | 2,507 | 744 | (155) |
Change in valuation allowance | (954) | (431) | (1,675) |
Income tax expense | 103,716 | 118,090 | 130,418 |
State | |||
Reconciliation of Provision of Income Taxes [Line Items] | |||
Income tax credits | (948) | (342) | (191) |
Federal | |||
Reconciliation of Provision of Income Taxes [Line Items] | |||
Income tax credits | $ (390) | $ (90) | $ (97) |
Earnings Per Share (Detail)
Earnings Per Share (Detail) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Oct. 31, 2016 | Jul. 31, 2016 | Apr. 30, 2016 | Jan. 31, 2016 | Oct. 31, 2015 | Jul. 31, 2015 | Apr. 30, 2015 | Jan. 31, 2015 | Oct. 31, 2016 | Oct. 31, 2015 | Oct. 31, 2014 | |
Earnings Per Share [Abstract] | |||||||||||
Net income | $ 75,962 | $ 54,716 | $ 47,602 | $ 10,681 | $ 27,371 | $ 50,881 | $ 71,246 | $ 66,503 | $ 188,961 | $ 216,001 | $ 249,048 |
Distributed and undistributed (earnings) to unvested restricted stock | (2,930) | (4,172) | (6,781) | ||||||||
Distributed and undistributed earnings to common shareholders — Basic | $ 186,031 | $ 211,829 | $ 242,267 | ||||||||
Weighted average shares outstanding — Basic | 22,225 | 22,243 | 22,441 | ||||||||
Weighted average shares outstanding — Diluted | 22,225 | 22,243 | 22,441 | ||||||||
Earnings per common share - Basic (in usd per share) | $ 8.37 | $ 9.52 | $ 10.80 | ||||||||
Earnings per common share - Diluted (in usd per share) | $ 3.36 | $ 2.42 | $ 2.11 | $ 0.47 | $ 1.22 | $ 2.27 | $ 3.13 | $ 2.87 | $ 8.37 | $ 9.52 | $ 10.80 |
Employee Benefit Plans - Additi
Employee Benefit Plans - Additional Information (Detail) - USD ($) $ in Thousands | 12 Months Ended | ||
Oct. 31, 2016 | Oct. 31, 2015 | Oct. 31, 2014 | |
Defined Contribution Pension And Other Postretirement Plans Disclosure [Line Items] | |||
Total contributions to the ESOP | $ 12,300 | $ 15,000 | $ 15,000 |
401(k) Plan | |||
Defined Contribution Pension And Other Postretirement Plans Disclosure [Line Items] | |||
Employee benefit plans, employer matching contribution, percent of employees' salary | 3.00% | ||
Employee benefit plans, total employer contribution | $ 7,404 | $ 6,670 | $ 6,058 |
401(k) Plan | Minimum | |||
Defined Contribution Pension And Other Postretirement Plans Disclosure [Line Items] | |||
Employee benefit plans, employer matching contribution, percent of employees' salary | 3.00% | ||
401(k) Plan | Maximum | |||
Defined Contribution Pension And Other Postretirement Plans Disclosure [Line Items] | |||
Employee benefit plans, employer matching contribution, percent of employees' salary | 5.00% | ||
401(k) Plan | Up To Three Percent Of Employee Salary Member [Member] | |||
Defined Contribution Pension And Other Postretirement Plans Disclosure [Line Items] | |||
Employee benefit plans, employer matching contribution percentage | 100.00% | ||
401(k) Plan | Between Three Percent And Five Percent Of Employee Salary Member [Member] | |||
Defined Contribution Pension And Other Postretirement Plans Disclosure [Line Items] | |||
Employee benefit plans, employer matching contribution percentage | 50.00% |
Stock Compensation Plans - Addi
Stock Compensation Plans - Additional Information (Detail) - USD ($) | Feb. 11, 2016 | Oct. 31, 2016 | Oct. 31, 2015 | Oct. 31, 2014 | Oct. 31, 2013 | Feb. 17, 2011 | Feb. 17, 2005 |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Stock compensation plan, maximum shares that may be issued | 4,200,000 | 3,500,000 | 2,250,000 | ||||
Stock compensation plan, additional shares that may be issued | 700,000 | ||||||
Share purchase plan, company's matched contributions | 25.00% | ||||||
Potential accrued compensation cost | $ 3,800,000 | ||||||
Stock Purchase Plan | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Share purchase plan, compensation expense related to the matching contribution | $ 313,000 | $ 297,000 | $ 199,000 | ||||
Management | Retainer and Meeting Fees | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Share purchase plan, percentage compensation received in the form of restricted stock | 100.00% | ||||||
Other Participants | Base Salary Compensation | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Share purchase plan, percentage compensation received in the form of restricted stock | 15.00% | ||||||
Other Participants | Deferred Bonus | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Share purchase plan, percentage compensation received in the form of restricted stock | 75.00% | ||||||
Restricted Stock | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Stock compensation plan, maximum shares that may be issued | 2,112,500 | 1,562,500 | 562,500 | ||||
Compensation cost | $ 6,459,000 | $ 6,452,000 | $ 4,831,000 | ||||
Unrecognized share-based compensation costs | $ 9,000,000 | ||||||
Unvested shares | 293,810 | 314,300 | 566,050 | 568,625 | |||
Unrecognized share-based compensation costs weighted average period of recognition | 1 year 9 months | ||||||
Restricted stock awards vested (in shares) | 119,407 | 327,988 | 84,601 | ||||
Restricted stock awards vested, weighted average fair value (in usd per share) | $ 54.09 | $ 44.98 | $ 40.22 | ||||
Restricted stock awards forfeited (in shares) | 3,018 | 1,362 | 16,899 | ||||
Restricted Stock | Stock Purchase Plan | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Stock compensation plan, vesting period | 3 years | ||||||
Share purchase plan, shares of restricted stock issued | 15,075 | 15,395 | 12,823 | ||||
Share purchase plan, value per share of restricted issued (in usd per share) | $ 84.71 | $ 78.53 | $ 80.80 | ||||
Restricted stock awards vested (in shares) | 16,746 | 21,540 | 24,445 | ||||
Restricted stock awards vested, weighted average fair value (in usd per share) | $ 57.41 | $ 51.06 | $ 43.98 | ||||
Restricted stock awards forfeited (in shares) | 484 | 112 | 1,523 | ||||
Restricted Stock | Employer Matched Contribution | Stock Purchase Plan | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Share purchase plan, shares of restricted stock issued | 3,650 | 3,734 | 3,101 | ||||
Restricted Stock | Minimum | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Stock compensation plan, vesting period | 3 years | 3 years | 3 years | ||||
Restricted Stock | Maximum | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Stock compensation plan, vesting period | 4 years | 4 years | 4 years | ||||
Performance Based Awards | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Compensation cost | $ 9,041,000 | $ 9,319,000 | $ 7,366,000 | ||||
Performance share agreements, performance period | 2 years | 2 years | 2 years | ||||
Performance share agreements, additional holding period | 1 year | 1 year | 1 year | ||||
Performance share agreements, percentage of grants made, minimum | 50.00% | 50.00% | 50.00% | ||||
Performance share agreements, percentage of grants made, maximum | 200.00% | 200.00% | 200.00% | ||||
Stock compensation plan, target shares for grant | 83,875 | ||||||
Performance Based Awards | 2012 Performance Share Agreement | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Compensation cost | $ 0 | $ 2,891,000 | $ 5,823,000 | ||||
Number of shares issued or estimated | 186,951 | ||||||
Performance Based Awards | 2013 Performance Share Agreement | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Compensation cost | $ 3,165,000 | 6,428,000 | |||||
Number of shares issued or estimated | 146,169 | ||||||
Performance Based Awards | 2014 Performance Share Agreement | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Compensation cost | $ 5,876,000 | $ 0 | |||||
Shares vested (shares) | 146,169 | ||||||
Vested shares issued (shares) | 146,169 | ||||||
Number of shares issued or estimated | 103,974 | ||||||
Performance Based Awards | 2015 Performance Share Agreement | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Number of shares issued or estimated | 0 |
Stock Compensation Plans - Rest
Stock Compensation Plans - Restricted Stock Activity (Detail) - Restricted Stock - $ / shares | 12 Months Ended | ||
Oct. 31, 2016 | Oct. 31, 2015 | Oct. 31, 2014 | |
Number of Shares | |||
Outstanding at beginning of period (in shares) | 314,300 | 566,050 | 568,625 |
Granted during fiscal period (in shares) | 101,935 | 77,600 | 98,925 |
Vested during period (in shares) | (119,407) | (327,988) | (84,601) |
Forfeited during period (in shares) | (3,018) | (1,362) | (16,899) |
Outstanding at end of period (in shares) | 293,810 | 314,300 | 566,050 |
Weighted Average Grant Price | |||
Outstanding at beginning of period (in usd per share) | $ 62.16 | $ 49.39 | $ 44.85 |
Granted during fiscal period (in usd per share) | 71.58 | 82.75 | 67.26 |
Vested during the period (in usd per share) | 54.09 | 44.98 | 40.22 |
Forfeited during the period (in usd per share) | 67.82 | 62.15 | 47.20 |
Outstanding at end of period (in usd per share) | $ 68.65 | $ 62.16 | $ 49.39 |
Stock Compensation Plans - Sche
Stock Compensation Plans - Schedule of Compensation Cost Related to Performance Share Agreements (Details) - Performance Shares - USD ($) | 12 Months Ended | ||
Oct. 31, 2016 | Oct. 31, 2015 | Oct. 31, 2014 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Total compensation cost | $ 9,041,000 | $ 9,319,000 | $ 7,366,000 |
2011 Performance Share Agreement | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Number of shares issued or estimated | 102,534 | ||
Total compensation cost | $ 0 | 0 | 1,543,000 |
2012 Performance Share Agreement | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Number of shares issued or estimated | 186,951 | ||
Total compensation cost | $ 0 | 2,891,000 | $ 5,823,000 |
2013 Performance Share Agreement | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Number of shares issued or estimated | 146,169 | ||
Total compensation cost | $ 3,165,000 | 6,428,000 | |
2014 Performance Share Agreement | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Number of shares issued or estimated | 103,974 | ||
Total compensation cost | $ 5,876,000 | $ 0 | |
2015 Performance Share Agreement | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Number of shares issued or estimated | 0 |
Commitments and Contingencies -
Commitments and Contingencies - Additional Information (Detail) $ in Thousands | 12 Months Ended | ||
Oct. 31, 2016USD ($)employee | Oct. 31, 2015USD ($) | Oct. 31, 2014USD ($) | |
Commitments and Contingencies Disclosure [Line Items] | |||
Number of employees | employee | 13,232 | ||
Percentage of employees covered by collective bargaining agreements | 13.30% | ||
Contractual obligations to purchase for feed grains, feed ingredients, and packaging supplies (due in less than one year) | $ 79,600 | ||
Capitalized interest | 300 | $ 500 | $ 1,100 |
Expected construction costs in next fiscal year | 19,400 | ||
St. Pauls, North Carolina | |||
Commitments and Contingencies Disclosure [Line Items] | |||
Estimated total cost of investment | 155,000 | ||
Construction cost spent | 135,600 | ||
Capitalized interest | 265 | ||
Property Subject to Operating Lease | |||
Commitments and Contingencies Disclosure [Line Items] | |||
Operating leases, rental expense | $ 13,700 | $ 11,600 | $ 9,000 |
Commitments and Contingencies51
Commitments and Contingencies - Minimum Lease Payments of Obligations Under Non-Cancelable Operating Leases (Detail) $ in Millions | Oct. 31, 2016USD ($) |
Commitments and Contingencies Disclosure [Abstract] | |
2,017 | $ 11.5 |
2,018 | 10.8 |
2,019 | 6.5 |
2,020 | 3.8 |
2,021 | 1.5 |
Operating Leases, Future Minimum Payments Due, Total | $ 34.1 |
Quarterly Financial Data (una52
Quarterly Financial Data (unaudited) (Detail) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Oct. 31, 2016 | Jul. 31, 2016 | Apr. 30, 2016 | Jan. 31, 2016 | Oct. 31, 2015 | Jul. 31, 2015 | Apr. 30, 2015 | Jan. 31, 2015 | Oct. 31, 2016 | Oct. 31, 2015 | Oct. 31, 2014 | |
Quarterly Financial Information Disclosure [Abstract] | |||||||||||
Net sales | $ 790,811 | $ 727,991 | $ 692,089 | $ 605,166 | $ 679,592 | $ 739,933 | $ 716,592 | $ 667,363 | $ 2,816,057 | $ 2,803,480 | $ 2,774,845 |
Gross profit | 160,655 | 129,428 | 113,813 | 50,105 | 83,753 | 127,172 | 139,025 | 141,162 | |||
Net income | $ 75,962 | $ 54,716 | $ 47,602 | $ 10,681 | $ 27,371 | $ 50,881 | $ 71,246 | $ 66,503 | $ 188,961 | $ 216,001 | $ 249,048 |
Diluted (in usd per share) | $ 3.36 | $ 2.42 | $ 2.11 | $ 0.47 | $ 1.22 | $ 2.27 | $ 3.13 | $ 2.87 | $ 8.37 | $ 9.52 | $ 10.80 |
Valuation and Qualifying Acco53
Valuation and Qualifying Accounts Schedule II (Detail) - Allowance for Doubtful Accounts - USD ($) $ in Thousands | 12 Months Ended | |||
Oct. 31, 2016 | Oct. 31, 2015 | Oct. 31, 2014 | ||
Movement in Valuation Allowances and Reserves [Roll Forward] | ||||
Balance at Beginning of Period | $ 2,500 | $ 2,200 | $ 2,200 | |
Charged to Costs and Expenses | 178 | 300 | 29 | |
Deductions Describe | [1] | 28 | 0 | 29 |
Balance at End of Period | $ 2,650 | $ 2,500 | $ 2,200 | |
[1] | Uncollectible accounts written off, net of recoveries |