COVER PAGE
COVER PAGE - shares | 9 Months Ended | |
Sep. 28, 2019 | Oct. 30, 2019 | |
Entity Information [Line Items] | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Period End Date | Sep. 28, 2019 | |
Document Transition Report | false | |
Entity File Number | 01-13697 | |
Entity Registrant Name | MOHAWK INDUSTRIES, INC. | |
Entity Incorporation, State or Country Code | DE | |
Entity Tax Identification Number | 52-1604305 | |
Entity Address, Address Line One | 160 S. Industrial Blvd. | |
Entity Address, City or Town | Calhoun | |
Entity Address, State or Province | GA | |
Entity Address, Postal Zip Code | 30701 | |
City Area Code | 706 | |
Local Phone Number | 629-7721 | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Large Accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 71,622,235 | |
Entity Central Index Key | 0000851968 | |
Current Fiscal Year End Date | --12-31 | |
Document Fiscal Year Focus | 2019 | |
Document Fiscal Period Focus | Q3 | |
Amendment Flag | false | |
Common Stock, $.01 par value | ||
Entity Information [Line Items] | ||
Title of 12(b) Security | Common Stock, $.01 par value | |
Trading Symbol | MHK | |
Security Exchange Name | NYSE | |
Floating Rate Notes due 2020 | ||
Entity Information [Line Items] | ||
Title of 12(b) Security | Floating Rate Notes due 2020 | |
No Trading Symbol Flag | true | |
Security Exchange Name | NYSE | |
Floating Rate Notes due 2021 | ||
Entity Information [Line Items] | ||
Title of 12(b) Security | Floating Rate Notes due 2021 | |
No Trading Symbol Flag | true | |
Security Exchange Name | NYSE | |
2.000% Senior Notes due 2022 | ||
Entity Information [Line Items] | ||
Title of 12(b) Security | 2.000% Senior Notes due 2022 | |
No Trading Symbol Flag | true | |
Security Exchange Name | NYSE |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets - USD ($) $ in Thousands | Sep. 28, 2019 | Dec. 31, 2018 |
Current assets: | ||
Cash and cash equivalents | $ 111,303 | $ 119,050 |
Receivables, net | 1,787,158 | 1,606,159 |
Inventories | 2,337,952 | 2,287,615 |
Prepaid expenses | 425,595 | 421,553 |
Other current assets | 65,772 | 74,919 |
Total current assets | 4,727,780 | 4,509,296 |
Property, plant and equipment | 8,357,331 | 8,227,074 |
Less: accumulated depreciation | 3,756,701 | 3,527,172 |
Property, plant and equipment, net | 4,600,630 | 4,699,902 |
Right of use operating lease assets | 334,083 | |
Goodwill | 2,519,214 | 2,520,966 |
Tradenames | 689,788 | 707,380 |
Other intangible assets subject to amortization, net | 227,165 | 254,430 |
Deferred income taxes and other non-current assets | 294,102 | 407,149 |
Total assets | 13,392,762 | 13,099,123 |
Current liabilities: | ||
Short-term debt and current portion of long-term debt | 1,273,158 | 1,742,373 |
Accounts payable and accrued expenses | 1,738,859 | 1,523,866 |
Current operating lease liabilities | 102,682 | |
Total current liabilities | 3,114,699 | 3,266,239 |
Deferred income taxes | 434,912 | 413,740 |
Long-term debt, less current portion | 1,483,581 | 1,515,601 |
Non-current operating lease liabilities | 238,560 | |
Other long-term liabilities | 355,731 | 463,484 |
Total liabilities | 5,627,483 | 5,659,064 |
Commitments and contingencies (Note 17) | ||
Stockholders’ equity: | ||
Preferred stock, $.01 par value; 60 shares authorized; no shares issued | 0 | 0 |
Common stock, $.01 par value; 150,000 shares authorized; 79,193 and 79,656 shares issued in 2019 and 2018, respectively | 792 | 797 |
Additional paid-in capital | 1,864,899 | 1,852,173 |
Retained earnings | 6,991,076 | 6,588,197 |
Accumulated other comprehensive loss | (882,287) | (791,608) |
Stockholders' equity before treasury stock | 7,974,480 | 7,649,559 |
Less: treasury stock at cost; 7,348 and 7,349 shares in 2019 and 2018, respectively | 215,712 | 215,745 |
Total Mohawk Industries, Inc. stockholders’ equity | 7,758,768 | 7,433,814 |
Nonredeemable noncontrolling interest | 6,511 | 6,245 |
Total stockholders’ equity | 7,765,279 | 7,440,059 |
Total liabilities and stockholders' equity | $ 13,392,762 | $ 13,099,123 |
Condensed Consolidated Balanc_2
Condensed Consolidated Balance Sheets (Parenthetical) - $ / shares | Sep. 28, 2019 | Dec. 31, 2018 |
Stockholders’ equity: | ||
Preferred stock, par value (in usd per share) | $ 0.01 | $ 0.01 |
Preferred stock, authorized (in shares) | 60,000 | 60,000 |
Preferred stock, issued (in shares) | 0 | 0 |
Common stock, par value (in usd per share) | $ 0.01 | $ 0.01 |
Common stock, authorized (in shares) | 150,000,000 | 150,000,000 |
Common stock, shares issued (in shares) | 79,193,000 | 79,656,000 |
Treasury stock, shares (in shares) | 7,348,000 | 7,349,000 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Operations - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 28, 2019 | Sep. 29, 2018 | Sep. 28, 2019 | Sep. 29, 2018 | |
Income Statement [Abstract] | ||||
Net sales | $ 2,519,185 | $ 2,545,800 | $ 7,546,160 | $ 7,535,016 |
Cost of sales | 1,827,494 | 1,825,367 | 5,492,924 | 5,343,336 |
Gross profit | 691,691 | 720,433 | 2,053,236 | 2,191,680 |
Selling, general and administrative expenses | 451,471 | 433,189 | 1,380,826 | 1,309,730 |
Operating income | 240,220 | 287,244 | 672,410 | 881,950 |
Interest expense | 9,316 | 9,025 | 30,310 | 24,416 |
Other expense, net | 52,713 | 706 | 45,929 | 6,794 |
Earnings before income taxes | 178,191 | 277,513 | 596,171 | 850,740 |
Income tax expense | 22,522 | 49,487 | 116,273 | 215,928 |
Net earnings including noncontrolling interests | 155,669 | 228,026 | 479,898 | 634,812 |
Net income attributable to noncontrolling interests | 151 | 1,013 | 354 | 2,447 |
Net earnings attributable to Mohawk Industries, Inc. | $ 155,518 | $ 227,013 | $ 479,544 | $ 632,365 |
Basic earnings per share attributable to Mohawk Industries, Inc. | ||||
Basic earnings per share attributable to Mohawk Industries, Inc. (in usd per share) | $ 2.16 | $ 3.03 | $ 6.63 | $ 8.46 |
Weighted-average common shares outstanding-basic (in shares) | 72,106 | 74,603 | 72,302 | 74,599 |
Diluted earnings per share attributable to Mohawk Industries, Inc. | ||||
Diluted earnings per share attributable to Mohawk Industries, Inc. (in usd per share) | $ 2.15 | $ 3.02 | $ 6.61 | $ 8.42 |
Weighted-average common shares outstanding-diluted (in shares) | 72,392 | 74,945 | 72,578 | 74,977 |
Condensed Consolidated Statem_2
Condensed Consolidated Statements of Comprehensive Income (Loss) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 28, 2019 | Sep. 29, 2018 | Sep. 28, 2019 | Sep. 29, 2018 | |
Statement of Comprehensive Income [Abstract] | ||||
Net earnings including noncontrolling interests | $ 155,669 | $ 228,026 | $ 479,898 | $ 634,812 |
Other comprehensive income (loss): | ||||
Foreign currency translation adjustments | (150,139) | (33,671) | (91,050) | (147,628) |
Pension prior service cost and actuarial gain (loss), net of tax | 216 | 68 | 283 | 291 |
Other comprehensive income (loss) | (149,923) | (33,603) | (90,767) | (147,337) |
Comprehensive income | 5,746 | 194,423 | 389,131 | 487,475 |
Comprehensive income (loss) attributable to noncontrolling interests | (7) | 656 | 266 | 962 |
Comprehensive income attributable to Mohawk Industries, Inc. | $ 5,753 | $ 193,767 | $ 388,865 | $ 486,513 |
Condensed Consolidated Statem_3
Condensed Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 28, 2019 | Sep. 29, 2018 | |
Cash flows from operating activities: | ||
Net earnings | $ 479,898 | $ 634,812 |
Adjustments to reconcile net earnings to net cash provided by (used in) operating activities: | ||
Restructuring | 45,533 | 42,791 |
Depreciation and amortization | 422,693 | 382,673 |
Deferred income taxes | 9,303 | 75,694 |
(Gain) loss on disposal of property, plant and equipment | 1,571 | (1,253) |
Stock-based compensation expense | 17,228 | 26,697 |
Impairment of net investment in a manufacturer and distributor of ceramic tile in China | 65,172 | 0 |
Changes in operating assets and liabilities, net of effects of acquisitions: | ||
Receivables, net | (203,447) | (180,830) |
Inventories | (60,477) | (209,815) |
Other assets and prepaid expenses | (38,942) | (68,122) |
Accounts payable and accrued expenses | 250,637 | 190,090 |
Other liabilities | (11,083) | 1,748 |
Net cash provided by operating activities | 978,086 | 894,485 |
Cash flows from investing activities: | ||
Additions to property, plant and equipment | (405,614) | (642,949) |
Acquisitions, net of cash acquired | (76,847) | (425,304) |
Purchases of short-term investments | (451,000) | (526,096) |
Redemption of short-term investments | 459,000 | 566,000 |
Net cash used in investing activities | (474,461) | (1,028,349) |
Cash flows from financing activities: | ||
Payments on Senior Credit Facilities | (465,811) | (600,926) |
Proceeds from Senior Credit Facilities | 419,957 | 554,408 |
Payments on Commercial Paper | (11,919,636) | (12,119,516) |
Proceeds from Commercial Paper | 11,540,489 | 11,976,223 |
Proceeds from Floating Rate Notes | 331,325 | 353,648 |
Payments on Floating Rate Notes | (331,325) | 0 |
Proceeds from other debt | 7,355 | 0 |
Debt issuance costs | (757) | (864) |
Purchase of Mohawk common stock | (76,671) | 0 |
Change in outstanding checks in excess of cash | (10,523) | (2,242) |
Shares redeemed for taxes | (4,711) | (9,188) |
Proceeds from stock transactions | 1 | 2 |
Net cash (used in) provided by financing activities | (510,307) | 151,545 |
Effect of exchange rate changes on cash and cash equivalents | (1,065) | (11,214) |
Net change in cash and cash equivalents | (7,747) | 6,467 |
Cash and cash equivalents, beginning of period | 119,050 | 84,884 |
Cash and cash equivalents, end of period | $ 111,303 | $ 91,351 |
General
General | 9 Months Ended |
Sep. 28, 2019 | |
Accounting Policies [Abstract] | |
General | General Interim Reporting The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with instructions to Form 10-Q and do not include all of the information and footnotes required by U.S. generally accepted accounting principles (“U.S. GAAP”) for complete financial statements. In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation have been included. These statements should be read in conjunction with the consolidated financial statements and notes thereto, and the Company’s description of critical accounting policies, included in the Company’s 2018 Annual Report on Form 10-K, as filed with the Securities and Exchange Commission. Results for interim periods are not necessarily indicative of the results for the year. Hedges of Net Investments in Non-U.S. Operations The Company has numerous investments outside the United States. The net assets of these subsidiaries are exposed to changes and volatility in currency exchange rates. The Company uses foreign currency denominated debt to hedge its non-U.S. net investments against adverse movements in exchange rates. The gains and losses on the Company’s net investments in its non-U.S. operations are economically offset by losses and gains on its foreign currency borrowings. The Company designated its €500,000 2.00% Senior Notes borrowing as a net investment hedge of a portion of its European operations. For the nine months ended September 28, 2019 and September 29, 2018 , the change in the U.S. dollar value of the Company’s euro denominated debt was a decrease of $25,102 ( $19,067 net of taxes) and a decrease of $19,848 ( $14,223 net of taxes), respectively, which is recorded in the foreign currency translation adjustment component of accumulated other comprehensive income or (loss). The change in the U.S. dollar value of the Company’s debt partially offsets the euro-to-dollar translation of the Company’s net investment in its European operations. Recent Accounting Pronouncements - Recently Adopted In February 2016, the FASB issued a new standard ASU 2016-02, Leases , and subsequently issued additional ASUs amending this ASU (collectively ASC 842, Leases ). ASC 842 was issued to increase transparency and comparability among organizations by requiring the recognition of right of use (“ROU”) assets and lease liabilities on the balance sheet. Most prominent among the changes in the standard is the recognition of ROU assets and lease liabilities by lessees for those leases classified as operating leases. Under the standard, disclosures are required to meet the objective of enabling users of financial statements to assess the amount, timing, and uncertainty of cash flows arising from leases. The Company adopted the provisions of ASC 842 on January 1, 2019 using a modified retrospective approach through a cumulative effect adjustment to retained earnings as of the beginning of the period of adoption in line with the new transition method allowed under ASU 2018-11. ASC 842 provides a number of optional practical expedients in transition. The Company elected the “package of practical expedients” which permits the Company not to reassess under the new standard its prior conclusions about lease identification, lease classification and initial direct costs. The Company did not elect the use-of-hindsight and elected the practical expedient pertaining to land easements. The new standard also provides practical expedients for an entity’s ongoing accounting for leases. The Company elected the short-term lease exemption for all leases that qualify, meaning the Company will not recognize ROU assets or lease liabilities for leases with terms shorter than twelve months. The Company also elected the practical expedient to not separate lease and non-lease components for a majority of its asset classes, including real estate and most equipment. The adoption of ASC 842 had a material impact on the Company’s condensed consolidated balance sheets, but did not have a material impact on our condensed consolidated statements of operations or cashflow. The most significant impact was the recognition of ROU assets of $328,169 and lease liabilities for operating leases of $332,286 at January 1, 2019, based on the present value of the future minimum rental payments for existing operating leases. The difference in the balances is due to deferred rent, tenant incentive allowances and prepaid amounts taken into account for adoption. Our accounting for finance leases remained substantially unchanged, See Note 10 - Leases. On January 1, 2019, the Company adopted the new accounting standard, ASU 2018-02, Reclassification of Certain Tax Effects from Accumulated Other Comprehensive Income . The standard permits entities to reclassify, to retained earnings, the one-time income tax effects stranded in accumulated other comprehensive income arising from the change in the U.S. federal corporate tax rate as a result of the Tax Cuts and Jobs Act of 2017. The effect of adopting the new standard was not material. On January 1, 2018, the Company adopted the new accounting standard, ASC 606, Revenue from Contracts with Customers and all the related amendments (“ASC 606”) and applied the provisions of the standard to all contracts using the modified retrospective method. The cumulative effect of adopting the new revenue standard was immaterial and no adjustment has been recorded to the opening balance of retained earnings. Prior year information has not been restated and continues to be reported under the accounting standards in effect for those periods. Substantially all of the Company’s revenue continues to be recognized at a point in time when the product is either shipped or received from the Company’s facilities and control of the product is transferred to the customer. The Company reviewed all of its revenue product categories under ASC 606 and the only changes identified were that an immaterial amount of revenue from intellectual property (“IP”) contracts results in earlier recognition of revenue, new controls and processes designed to meet the requirements of the standard were implemented, and the required new disclosures are presented in Note 3, Revenue from Contracts with Customers. The adoption of ASC 606 did not have a material impact on the amounts reported in the Company’s consolidated financial position, results of operations or cash flows. On January 1, 2018, the Company adopted the new accounting standard, ASU 2016-15, Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments. The effect of adopting the new standard was not material. On January 1, 2018, the Company adopted the new accounting standard, ASU 2017-01, Business Combinations (Topic 805): Clarifying the Definition of a Business. The effect of adopting the new standard was not material. Recent Accounting Pronouncements - Effective in Future Years In January 2017, the FASB issued ASU 2017-04, Intangibles - Goodwill and other (Topic 350): Simplifying the test for goodwill impairment. The amendments remove the second step of the current goodwill impairment test. An entity will apply a one-step quantitative test and record the amount of goodwill impairment as the excess of a reporting unit's carrying amount over its fair value, not to exceed the total amount of goodwill allocated to the reporting unit. The new guidance does not amend the optional qualitative assessment of goodwill impairment. This guidance is effective for impairment tests in fiscal years beginning after December 15, 2019. Currently, the Company is assessing the impact of the new guidance. The Company does not expect the adoption of the guidance to have a significant impact on its financial statements. In June 2016, the FASB issued ASU 2016-13, Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments and in November 2018 issued ASU 2018-19, which amended the standard. The standard introduces an approach, based on expected losses, to estimate credit losses on certain types of financial instruments and modifies the impairment model for available-for-sale debt securities. The new approach to estimating credit losses (referred to as the current expected credit losses model) applies to most financial assets measured at amortized cost and certain other instruments, including trade and other receivables, loans, held-to-maturity debt securities, net investments in leases and off-balance-sheet credit exposures. This standard is effective for the Company on January 1, 2020. Entities are required to apply the standard’s provisions as a cumulative-effect adjustment to retained earnings as of the beginning of the first reporting period in which the guidance is adopted. Currently, the Company is assessing the impact of the new guidance. The Company does not expect the adoption of the guidance to have a significant impact on its financial statements. |
Acquisitions
Acquisitions | 9 Months Ended |
Sep. 28, 2019 | |
Business Combinations [Abstract] | |
Acquisitions | Acquisitions 2019 Acquisitions On January 31, 2019 , the Company acquired a hard surface flooring distribution company based in the Netherlands for $72,001 , resulting in a preliminary goodwill allocation of $45,931 . The results have been included in the Flooring Rest of the World (“Flooring ROW”) segment and are not material to the Company’s consolidated results of operations. 2018 Acquisitions On November 16, 2018 , the Company completed its purchase of Eliane S/A Revestimentos Ceramicos (“Eliane”), one of the largest ceramic tile companies in Brazil. Pursuant to the purchase agreement, the Company (i) acquired the entire issued share capital of Eliane and (ii) acquired $99,037 of net indebtedness of Eliane, with total cash consideration paid of $ 148,741 . The Company’s acquisition of Eliane resulted in allocations of goodwill of $ 18,062 , indefinite-lived tradename intangible assets of $ 32,238 and intangible assets subject to amortization of $ 5,818 . The goodwill is expected to be deductible for tax purposes. Eliane’s results of operations have been included in the consolidated financial statements since the date of acquisition in the Global Ceramic reporting segment. On July 2, 2018 , the Company completed its acquisition of Godfrey Hirst Group, the leading flooring company in Australia and New Zealand, further extending Mohawk’s global position. The total value of the acquisition was $400,894 . The Company’s acquisition of Godfrey Hirst Group resulted in allocations of goodwill of $88,655 , indefinite-lived tradename intangible assets of $58,671 and intangible assets subject to amortization of $43,635 . The goodwill is deductible for tax purposes. The factors contributing to the recognition of the amount of goodwill include product, sales and manufacturing synergies. The Godfrey Hirst Group’s results have been included in the condensed consolidated financial statements since the date of acquisition in the Flooring NA and Flooring ROW segments. During the first quarter of 2018, the Company completed the acquisition of three businesses in the Flooring ROW segment for $24,610 , resulting in a goodwill allocation of $12,874 and intangibles subject to amortization of $7 . 2017 Acquisitions On April 4, 2017, the Company completed its purchase of Emilceramica S.r.l (“Emil”), a ceramic company in Italy. The total value of the acquisition was $186,099 . The Emil acquisition will enhance the Company’s cost position and strengthen its combined brand and distribution in Europe. The acquisition’s results and purchase price allocation have been included in the condensed consolidated financial statements since the date of the acquisition. The Company’s acquisition of Emil resulted in a goodwill allocation of $59,491 , indefinite-lived tradename intangible asset of $16,196 and an intangible asset subject to amortization of $2,348 . The goodwill was not directly deductible for tax purposes. The Emil results are reflected in the Global Ceramic segment and the results of Emil’s operations are not material to the Company’s consolidated results of operations. During the second quarter of 2017, the Company completed the acquisition of two businesses in the Global Ceramic segment for $37,250 , resulting in a goodwill allocation of $1,002 . The Company also completed the acquisition of a business in the Flooring NA segment for $26,623 . During the first quarter of 2017, the Company acquired certain assets of a distribution business in the Flooring ROW segment for $1,407 , resulting in intangible assets subject to amortization of $827 . |
Revenue from Contracts with Cus
Revenue from Contracts with Customers | 9 Months Ended |
Sep. 28, 2019 | |
Revenue from Contract with Customer [Abstract] | |
Revenue from Contracts with Customers | Revenue from Contracts with Customers Revenue recognition and accounts receivable The Company recognizes revenues when it satisfies performance obligations as evidenced by the transfer of control of the promised goods to customers, in an amount that reflects the consideration the Company expects to be entitled to in exchange for those goods. The nature of the promised goods are ceramic, stone, carpet, resilient, laminate, wood and other flooring products. Payment is typically received 90 days or less from the invoice date. The Company adjusts the amounts of revenue for expected cash discounts, sales allowances, returns, and claims, based upon historical experience. The Company adjusts accounts receivable for doubtful account allowances based upon historical bad debt, claims experience, periodic evaluation of specific customer accounts, and the aging of accounts receivable. If the financial condition of the Company’s customers were to deteriorate, resulting in an impairment of their ability to make payments, additional allowances may be required. Contract liabilities The Company historically records contract liabilities when it receives payment prior to fulfilling a performance obligation. Contract liabilities related to revenues are recorded in accounts payable and accrued expenses on the accompanying condensed consolidating balance sheets. The Company had contract liabilities of $39,284 and $34,486 as of September 28, 2019 and January 1, 2019 , respectively. Performance obligations Substantially all of the Company’s revenue is recognized at a point in time when the product is either shipped or received from the Company’s facilities and control of the product is transferred to the customer. Accordingly, in any period, the Company does not recognize a significant amount of revenue from performance obligations satisfied or partially satisfied in prior periods and the amount of such revenue recognized during the three and nine months ended September 28, 2019 was immaterial. Costs to obtain a contract The Company historically incurs certain incremental costs to obtain revenue contracts. These costs relate to marketing display structures and are capitalized when the amortization period is greater than one year, with the amount recorded in other assets on the accompanying condensed consolidated balance sheets. Capitalized costs to obtain contracts were $54,900 and $57,840 as of September 28, 2019 and January 1, 2019 , respectively. Amortization expense recognized during the nine months ended September 28, 2019 related to these capitalized costs was $41,889 . Practical expedients and policy elections The Company elected the following practical expedients and policy elections: • Incremental costs of obtaining a contract is recorded as an expense when incurred in selling, general and administrative expenses if the amortization period is less than one year . • Shipping and handling activities performed after control has been transferred is accounted for as a fulfillment cost in cost of sales. Revenue disaggregation The following table presents the Company’s segment revenues disaggregated by the geographical market location of customer sales and product categories for the three months ended September 28, 2019 and September 29, 2018 : September 28, 2019 Global Ceramic segment Flooring NA segment Flooring ROW segment Total Geographical Markets United States $ 537,247 963,784 475 1,501,506 Europe 168,032 1,901 424,230 594,163 Russia 77,024 15 32,614 109,653 Other 134,119 36,208 143,536 313,863 $ 916,422 1,001,908 600,855 2,519,185 Product Categories Ceramic & Stone $ 916,422 13,570 — 929,992 Carpet & Resilient — 816,190 193,941 1,010,131 Laminate & Wood — 172,148 204,241 376,389 Other (1) — — 202,673 202,673 $ 916,422 1,001,908 600,855 2,519,185 September 29, 2018 Global Ceramic segment Flooring NA segment Flooring ROW segment Total Geographical Markets United States $ 565,616 998,488 421 1,564,525 Europe 175,026 1,217 438,585 614,828 Russia 68,113 — 27,435 95,548 Other 77,018 47,835 146,046 270,899 $ 885,773 1,047,540 612,487 2,545,800 Product Categories Ceramic & Stone $ 885,773 16,779 — 902,552 Carpet & Resilient — 851,970 192,001 1,043,971 Laminate & Wood — 178,791 200,499 379,290 Other (1) — — 219,987 219,987 $ 885,773 1,047,540 612,487 2,545,800 (1) Other includes roofing elements, insulation boards, chipboards and IP contracts. The following table presents the Company’s segment revenues disaggregated by the geographical market location of customer sales and product categories for the nine months ended September 28, 2019 and September 29, 2018 : September 28, 2019 Global Ceramic segment Flooring NA segment Flooring ROW segment Total Geographical Markets United States $ 1,633,583 2,793,110 1,252 4,427,945 Europe 552,546 5,902 1,369,908 1,928,356 Russia 196,731 66 83,315 280,112 Other 389,945 108,249 411,553 909,747 $ 2,772,805 2,907,327 1,866,028 7,546,160 Product Categories Ceramic & Stone $ 2,772,805 41,928 — 2,814,733 Carpet & Resilient — 2,360,014 586,388 2,946,402 Laminate & Wood — 505,385 629,500 1,134,885 Other (1) — — 650,140 650,140 $ 2,772,805 2,907,327 1,866,028 7,546,160 September 29, 2018 Global Ceramic segment Flooring NA segment Flooring ROW segment Total Geographical Markets United States $ 1,700,338 2,920,604 421 4,621,363 Europe 573,932 4,737 1,424,113 2,002,782 Russia 183,244 — 73,417 256,661 Other 234,104 130,127 289,979 654,210 $ 2,691,618 3,055,468 1,787,930 7,535,016 Product Categories Ceramic & Stone $ 2,691,618 52,500 — 2,744,118 Carpet & Resilient — 2,466,695 453,597 2,920,292 Laminate & Wood — 536,273 643,389 1,179,662 Other (1) — — 690,944 690,944 $ 2,691,618 3,055,468 1,787,930 7,535,016 (1) Other includes roofing elements, insulation boards, chipboards and IP contracts. |
Restructuring, acquisition and
Restructuring, acquisition and integration-related costs | 9 Months Ended |
Sep. 28, 2019 | |
Restructuring and Related Activities [Abstract] | |
Restructuring, acquisition and integration-related costs | Restructuring, acquisition and integration-related costs The Company incurs costs in connection with acquiring, integrating and restructuring acquisitions and in connection with its global cost-reduction/productivity initiatives. For example: • In connection with acquisition activity, the Company typically incurs costs associated with executing the transactions, integrating the acquired operations (which may include expenditures for consulting and the integration of systems and processes), and restructuring the combined company (which may include charges related to employees, assets and activities that will not continue in the combined company); and • In connection with the Company’s cost-reduction/productivity initiatives, it typically incurs costs and charges associated with site closings and other facility rationalization actions and workforce reductions. Restructuring, acquisition transaction and integration-related costs consisted of the following during the three and nine months ended September 28, 2019 and September 29, 2018 : Three Months Ended Nine Months Ended September 28, 2019 September 29, 2018 September 28, 2019 September 29, 2018 Cost of sales Restructuring costs (1) $ 7,284 10,004 43,197 33,425 Acquisition integration-related costs 180 198 2,736 3,293 Restructuring and acquisition integration-related costs $ 7,464 10,202 45,933 36,718 Selling, general and administrative expenses Restructuring costs (1) $ 491 1,476 2,336 9,366 Acquisition transaction-related costs 413 3,032 1,330 3,095 Acquisition integration-related costs 1,147 5,180 4,554 8,857 Restructuring, acquisition transaction and integration-related costs $ 2,051 9,688 8,220 21,318 (1) The restructuring costs for 2019 and 2018 primarily relate to the Company’s actions taken to lower its cost structure and improve efficiencies of manufacturing and distribution operations as well as actions related to the Company’s recent acquisitions. The restructuring activity for the nine months ended September 28, 2019 is as follows: Lease impairments Asset write-downs Severance Other restructuring costs Total Balance as of December 31, 2018 $ 397 — 7,866 250 8,513 Provision - Global Ceramic segment — — 4,879 — 4,879 Provision - Flooring NA segment — 21,791 1,168 12,087 35,046 Provision - Flooring ROW segment — 2,515 2,367 726 5,608 Cash payments (361 ) — (11,715 ) (12,702 ) (24,778 ) Non-cash items — (24,306 ) (130 ) (111 ) (24,547 ) Balance as of September 28, 2019 $ 36 — 4,435 250 4,721 |
Receivables, net
Receivables, net | 9 Months Ended |
Sep. 28, 2019 | |
Receivables [Abstract] | |
Receivables, net | Receivables, net Receivables, net are as follows: At September 28, 2019 At December 31, 2018 Customers, trade $ 1,763,435 1,562,284 Income tax receivable 15,781 17,217 Other 78,399 101,376 1,857,615 1,680,877 Less: allowance for discounts, claims and doubtful accounts 70,457 74,718 Receivables, net $ 1,787,158 1,606,159 |
Inventories
Inventories | 9 Months Ended |
Sep. 28, 2019 | |
Inventory Disclosure [Abstract] | |
Inventories | Inventories The components of inventories are as follows: At September 28, 2019 At December 31, 2018 Finished goods $ 1,637,525 1,582,112 Work in process 150,089 165,616 Raw materials 550,338 539,887 Total inventories $ 2,337,952 2,287,615 |
Goodwill and intangible assets
Goodwill and intangible assets | 9 Months Ended |
Sep. 28, 2019 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill and intangible assets | Goodwill and intangible assets The components of goodwill and other intangible assets are as follows: Goodwill: Global Ceramic segment Flooring NA segment Flooring ROW segment Total Balance as of December 31, 2018 Goodwill $ 1,564,987 874,198 1,409,206 3,848,391 Accumulated impairment losses (531,930 ) (343,054 ) (452,441 ) (1,327,425 ) 1,033,057 531,144 956,765 2,520,966 Goodwill recognized during the period (1,758 ) — 47,543 45,785 Currency translation during the period (2,740 ) — (44,797 ) (47,537 ) Balance as of September 28, 2019 Goodwill 1,560,489 874,198 1,411,952 3,846,639 Accumulated impairment losses (531,930 ) (343,054 ) (452,441 ) (1,327,425 ) $ 1,028,559 531,144 959,511 2,519,214 Intangible assets not subject to amortization: Tradenames Balance as of December 31, 2018 $ 707,380 Intangible assets acquired during the period (874 ) Currency translation during the period (16,718 ) Balance as of September 28, 2019 $ 689,788 Intangible assets subject to amortization: Gross carrying amounts: Customer Patents Other Total Balance as of December 31, 2018 $ 651,012 254,483 6,535 912,030 Intangible assets recognized during the period 2,092 — — 2,092 Currency translation during the period (20,143 ) (11,213 ) (173 ) (31,529 ) Balance as of September 28, 2019 $ 632,961 243,270 6,362 882,593 Accumulated amortization: Customer Patents Other Total Balance as of December 31, 2018 $ 406,386 249,988 1,227 657,601 Amortization during the period 19,027 1,606 (37 ) 20,596 Currency translation during the period (11,722 ) (11,028 ) (19 ) (22,769 ) Balance as of September 28, 2019 $ 413,691 240,566 1,171 655,428 Intangible assets subject to amortization, net $ 219,270 2,704 5,191 227,165 Three Months Ended Nine Months Ended September 28, September 29, September 28, September 29, Amortization expense $ 6,912 8,148 20,596 23,198 |
Accounts payable and accrued ex
Accounts payable and accrued expenses | 9 Months Ended |
Sep. 28, 2019 | |
Payables and Accruals [Abstract] | |
Accounts payable and accrued expenses | Accounts payable and accrued expenses Accounts payable and accrued expenses are as follows: At September 28, 2019 At December 31, 2018 Outstanding checks in excess of cash $ 4,064 14,624 Accounts payable, trade 964,098 811,879 Accrued expenses 490,094 430,431 Product warranties 46,984 47,511 Accrued interest 12,293 21,908 Accrued compensation and benefits 221,326 197,513 Total accounts payable and accrued expenses $ 1,738,859 1,523,866 |
Accumulated other comprehensive
Accumulated other comprehensive income (loss) | 9 Months Ended |
Sep. 28, 2019 | |
Equity [Abstract] | |
Accumulated other comprehensive income (loss) | Accumulated other comprehensive income (loss) The changes in accumulated other comprehensive income (loss) by component, for the nine months ended September 28, 2019 are as follows: Foreign currency translation adjustments Pensions, net of tax Total Balance as of December 31, 2018 $ (782,102 ) (9,506 ) (791,608 ) Current period other comprehensive income (90,962 ) 283 (90,679 ) Balance as of September 28, 2019 $ (873,064 ) (9,223 ) (882,287 ) The following tables reflect the changes in stockholders’ equity for the three months ended September 28, 2019 and September 29, 2018 (in thousands). Total Stockholders’ Equity Redeemable Noncontrolling Interest Common Stock Additional Paid-in Capital Retained Earnings Accumulated Other Comprehensive Income (Loss) Treasury Stock Noncontrolling Interest Total Stockholders’ Equity Shares Amount Shares Amount June 29, 2019 $ — 79,712 $ 797 $ 1,859,248 $ 6,903,261 $ (732,521 ) (7,348 ) $ (215,712 ) $ 6,518 $ 7,821,591 Shares issued under employee and director stock plans — — — — — — — — — — Stock-based compensation expense — — — 5,651 — — — — — 5,651 Repurchases of common stock — (519 ) (5 ) — (67,703 ) — — — — (67,708 ) Accretion of redeemable noncontrolling interest — — — — — — — — — — Noncontrolling earnings — — — — — — — — 150 150 Currency translation adjustment on non-controlling interests — — — — — — — — (157 ) (157 ) Currency translation adjustment — — — — — (149,982 ) — — — (149,982 ) Prior pension and post-retirement benefit service cost and actuarial gain / loss — — — — — 216 — — — 216 Net income — — — — 155,518 — — — — 155,518 September 28, 2019 $ — 79,193 $ 792 $ 1,864,899 $ 6,991,076 $ (882,287 ) (7,348 ) $ (215,712 ) $ 6,511 $ 7,765,279 Total Stockholders’ Equity Redeemable Noncontrolling Interest Common Stock Additional Paid-in Capital Retained Earnings Accumulated Other Comprehensive Income (Loss) Treasury Stock Noncontrolling Interest Total Stockholders’ Equity Shares Amount Shares Amount June 30, 2018 $ 30,043 81,952 $ 820 $ 1,842,060 $ 6,409,552 $ (671,133 ) (7,350 ) $ (215,745 ) $ 7,880 $ 7,373,434 Shares issued under employee and director stock plans — — — — — — — — — — Stock-based compensation expense — — — 5,104 — — — — — 5,104 Repurchases of common stock — — — — — — — — — — Accretion of redeemable noncontrolling interest 670 — — — (669 ) — — — — (669 ) Noncontrolling earnings 817 — — — — — — — 195 195 Currency translation adjustment on non-controlling interests (303 ) — — — — — — — (54 ) (54 ) Currency translation adjustment — — — — — (33,314 ) — — — (33,314 ) Prior pension and post-retirement benefit service cost and actuarial gain / loss — — — — — 68 — — — 68 Net income — — — — 227,013 — — — — 227,013 September 29, 2018 $ 31,227 81,952 $ 820 $ 1,847,164 $ 6,635,896 $ (704,379 ) (7,350 ) $ (215,745 ) $ 8,021 $ 7,571,777 The following tables reflect the changes in stockholders’ equity for the nine months ended September 28, 2019 and September 29, 2018 (in thousands). Total Stockholders’ Equity Redeemable Noncontrolling Interest Common Stock Additional Paid-in Capital Retained Earnings Accumulated Other Comprehensive Income (Loss) Treasury Stock Noncontrolling Interest Total Stockholders’ Equity Shares Amount Shares Amount January 1, 2019 $ — 79,656 $ 797 $ 1,852,173 $ 6,588,197 $ (791,608 ) (7,349 ) $ (215,745 ) $ 6,245 $ 7,440,059 Shares issued under employee and director stock plans — 122 1 (4,502 ) — — 1 33 — (4,468 ) Stock-based compensation expense — — — 17,228 — — — — — 17,228 Repurchases of common stock — (585 ) (6 ) — (76,665 ) — — — — (76,671 ) Accretion of redeemable noncontrolling interest — — — — — — — — — — Noncontrolling earnings — — — — — — — — 354 354 Currency translation adjustment on non-controlling interests — — — — — — — — (88 ) (88 ) Currency translation adjustment — — — — — (90,962 ) — — — (90,962 ) Prior pension and post-retirement benefit service cost and actuarial gain / loss — — — — — 283 — — — 283 Net income — — — — 479,544 — — — — 479,544 September 28, 2019 $ — 79,193 $ 792 $ 1,864,899 $ 6,991,076 $ (882,287 ) (7,348 ) $ (215,712 ) $ 6,511 $ 7,765,279 Total Stockholders’ Equity Redeemable Noncontrolling Interest Common Stock Additional Paid-in Capital Retained Earnings Accumulated Other Comprehensive Income (Loss) Treasury Stock Noncontrolling Interest Total Stockholders’ Equity Shares Amount Shares Amount January 1, 2018 $ 29,463 81,771 $ 818 $ 1,828,131 $ 6,004,506 $ (558,527 ) (7,350 ) $ (215,766 ) $ 7,847 $ 7,067,009 Shares issued under employee and director stock plans — 181 2 (7,664 ) — — — 21 — (7,641 ) Stock-based compensation expense — — — 26,697 — — — — — 26,697 Repurchases of common stock — — — — — — — — — — Accretion of redeemable noncontrolling interest 975 — — — (975 ) — — — — (975 ) Noncontrolling earnings 2,043 — — — — — — — 404 404 Currency translation adjustment on non-controlling interests (1,254 ) — — — — — — — (230 ) (230 ) Currency translation adjustment — — — — (146,143 ) — — — (146,143 ) Prior pension and post-retirement benefit service cost and actuarial gain / loss — — — — — 291 — — — 291 Net income — — — — 632,365 — — — — 632,365 September 29, 2018 $ 31,227 81,952 $ 820 $ 1,847,164 $ 6,635,896 $ (704,379 ) (7,350 ) $ (215,745 ) $ 8,021 $ 7,571,777 |
Leases
Leases | 9 Months Ended |
Sep. 28, 2019 | |
Leases [Abstract] | |
Leases | Leases Effective January 1, 2019 the Company adopted ASC 842, which requires recognition of right of use (“ROU”) assets and lease liabilities on the balance sheet, based on the present value of the future minimum rental payments for existing operating leases. The Company adopted the provisions of ASC 842 on January 1, 2019 using a modified retrospective approach through a cumulative effect adjustment to retained earnings as of the beginning of the period of adoption in line with the new transition method allowed under ASU 2018-11. ASC 842 provides a number of optional practical expedients in transition. The Company elected the “package of practical expedients” which permits the Company not to reassess under the new standard its prior conclusions about lease identification, lease classification and initial direct costs. The Company did not elect the use-of-hindsight and elected the practical expedient pertaining to land easements. The new standard also provides practical expedients for an entity’s ongoing accounting for leases. The Company elected the short-term lease exemption for all leases that qualify, meaning the Company will not recognize ROU assets or lease liabilities for leases with terms shorter than twelve months. The Company also elected the practical expedient to not separate lease and non-lease components for a majority of its asset classes, including real estate and most equipment. The Company measures the ROU assets and liabilities based on the present value of the future minimum lease payments over the lease term at the commencement date. Minimum lease payments include the fixed lease and non-lease components of the agreement, as well as any variable rent payments that depend on an index, initially measured using the index at the lease commencement date. The ROU assets are adjusted for any initial direct costs incurred less any lease incentives received, in addition to payments made on or before the commencement date of the lease. The Company recognizes lease expense for leases on a straight-line basis over the lease term. As the implicit rate is not readily determinable for most of the Company’s lease agreements, the Company uses an estimated incremental borrowing rate to determine the initial present value of lease payments. These discount rates for leases are calculated using the Company’s credit spread adjusted for current market factors and foreign currency rates. The Company also made a policy election to determine its incremental borrowing rate, at the initial application date, using the total lease term and the total minimum rental payments, as the Company believes this rate is more indicative of the implied financing cost. The Company determines if a contract is or contains a lease at inception. The Company has operating and finance leases for service centers, warehouses, showrooms, and machinery and equipment. Leases with an initial term of 12 months or less are not recorded on the balance sheet. The Company enters into lease contracts ranging from 1 to 60 years with a majority of the Company’s lease terms ranging from 1 to 8 years . Some leases include one or more options to renew, with renewal terms that can extend the lease term from 3 to 10 years or more. The exercise of these lease renewal options is at the Company’s sole discretion. An insignificant number of our leases include options to purchase the leased property. The depreciable life of assets and leasehold improvements are limited by the expected lease term. Certain of our leases include rental payments that will adjust periodically for inflation or certain adjustments based on step increases. An insignificant number of our leases contain residual value guarantees and none of our agreements contain material restrictive covenants. Variable rent expenses consist primarily of maintenance, property taxes and charges based on usage. We rent or sublease certain real estate to third parties. Our sublease portfolio consists mainly of operating leases. The components of lease costs are as follows: Three Months Ended September 28, 2019 Nine Months Ended September 28, 2019 Cost of Goods Sold Selling, General and Administrative Total Cost of Goods Sold Selling, General and Administrative Total Operating lease costs Fixed $ 8,068 25,316 33,384 23,925 72,578 96,503 Short-term 1,092 2,640 3,732 4,083 9,126 13,209 Variable 1,475 7,053 8,528 5,846 21,601 27,447 Sub-leases (114 ) (113 ) (227 ) (239 ) (397 ) (636 ) 10,521 34,896 45,417 33,615 102,908 136,523 Finance lease costs Amortization of leased assets — 404 404 — 1,228 1,228 Interest on lease liabilities — 102 102 — 191 191 — 506 506 — 1,419 1,419 Net lease costs $ 10,521 35,402 45,923 33,615 104,327 137,942 Supplemental balance sheet information related to leases is as follows: Classification At September 28, 2019 Assets Operating Leases Right of use operating lease assets Right of use operating lease assets $ 334,083 Finance Leases Property, plant and equipment, gross Property, plant and equipment 14,727 Accumulated depreciation Accumulated depreciation (2,809 ) Property, plant and equipment, net Property, plant and equipment, net 11,918 Total lease assets $ 346,001 Liabilities Operating Leases Other current Current operating lease liabilities $ 102,682 Non-current Non-current operating lease liabilities 238,560 Total operating liabilities 341,242 Finance Leases Short-term debt Short-term debt and current portion of long-term debt 1,351 Long-term debt Long-term debt, less current portion 11,319 Total finance liabilities 12,670 Total lease liabilities $ 353,912 Maturities of lease liabilities are as follows: Year ending December 31, Finance Leases Operating Leases Total 2019 (excluding the nine months ended September 28, 2019) $ 432 31,316 31,748 2020 1,647 116,032 117,679 2021 1,258 88,122 89,380 2022 1,022 59,951 60,973 2023 926 32,688 33,614 Thereafter 8,987 42,182 51,169 Total lease payments 14,272 370,291 384,563 Less imputed interest 1,602 29,049 Present value, Total $ 12,670 341,242 The Company had approximately $2,709 of leases that commenced after September 28, 2019 that created rights and obligations to the Company. These leases are not included in the above maturity schedule. For additional information regarding the Company’s Commitments and Contingencies as of December 31, 2018 as disclosed for capital and operating leases, see Note 14 in its 2018 Annual Report filed on Form 10-K. Lease term and discount rate are as follows: At September 28, 2019 Weighted Average Remaining Lease Term Operating Leases 4.37 Finance Leases 12.32 Weighted Average Discount Rate Operating Leases 3.3 % Finance Leases 2.4 % Supplemental cash flow information related to leases was as follows: Nine Months Ended September 28, Cash paid for amounts included in measurement of lease liabilities: Operating cash flows from operating leases $ 96,752 Operating cash flows from finance leases 123 Financing cash flows from finance leases 1,224 Right-of-use assets obtained in exchange for lease obligations: Operating Leases 113,253 Finance Leases 7,636 Amortization: Amortization of Right of use operating lease assets (1) 85,061 (1) Amortization of Right of use operating lease assets during the period is reflected in Other assets and prepaid expenses on the Condensed Consolidated Statements of Cash Flows. |
Leases | Leases Effective January 1, 2019 the Company adopted ASC 842, which requires recognition of right of use (“ROU”) assets and lease liabilities on the balance sheet, based on the present value of the future minimum rental payments for existing operating leases. The Company adopted the provisions of ASC 842 on January 1, 2019 using a modified retrospective approach through a cumulative effect adjustment to retained earnings as of the beginning of the period of adoption in line with the new transition method allowed under ASU 2018-11. ASC 842 provides a number of optional practical expedients in transition. The Company elected the “package of practical expedients” which permits the Company not to reassess under the new standard its prior conclusions about lease identification, lease classification and initial direct costs. The Company did not elect the use-of-hindsight and elected the practical expedient pertaining to land easements. The new standard also provides practical expedients for an entity’s ongoing accounting for leases. The Company elected the short-term lease exemption for all leases that qualify, meaning the Company will not recognize ROU assets or lease liabilities for leases with terms shorter than twelve months. The Company also elected the practical expedient to not separate lease and non-lease components for a majority of its asset classes, including real estate and most equipment. The Company measures the ROU assets and liabilities based on the present value of the future minimum lease payments over the lease term at the commencement date. Minimum lease payments include the fixed lease and non-lease components of the agreement, as well as any variable rent payments that depend on an index, initially measured using the index at the lease commencement date. The ROU assets are adjusted for any initial direct costs incurred less any lease incentives received, in addition to payments made on or before the commencement date of the lease. The Company recognizes lease expense for leases on a straight-line basis over the lease term. As the implicit rate is not readily determinable for most of the Company’s lease agreements, the Company uses an estimated incremental borrowing rate to determine the initial present value of lease payments. These discount rates for leases are calculated using the Company’s credit spread adjusted for current market factors and foreign currency rates. The Company also made a policy election to determine its incremental borrowing rate, at the initial application date, using the total lease term and the total minimum rental payments, as the Company believes this rate is more indicative of the implied financing cost. The Company determines if a contract is or contains a lease at inception. The Company has operating and finance leases for service centers, warehouses, showrooms, and machinery and equipment. Leases with an initial term of 12 months or less are not recorded on the balance sheet. The Company enters into lease contracts ranging from 1 to 60 years with a majority of the Company’s lease terms ranging from 1 to 8 years . Some leases include one or more options to renew, with renewal terms that can extend the lease term from 3 to 10 years or more. The exercise of these lease renewal options is at the Company’s sole discretion. An insignificant number of our leases include options to purchase the leased property. The depreciable life of assets and leasehold improvements are limited by the expected lease term. Certain of our leases include rental payments that will adjust periodically for inflation or certain adjustments based on step increases. An insignificant number of our leases contain residual value guarantees and none of our agreements contain material restrictive covenants. Variable rent expenses consist primarily of maintenance, property taxes and charges based on usage. We rent or sublease certain real estate to third parties. Our sublease portfolio consists mainly of operating leases. The components of lease costs are as follows: Three Months Ended September 28, 2019 Nine Months Ended September 28, 2019 Cost of Goods Sold Selling, General and Administrative Total Cost of Goods Sold Selling, General and Administrative Total Operating lease costs Fixed $ 8,068 25,316 33,384 23,925 72,578 96,503 Short-term 1,092 2,640 3,732 4,083 9,126 13,209 Variable 1,475 7,053 8,528 5,846 21,601 27,447 Sub-leases (114 ) (113 ) (227 ) (239 ) (397 ) (636 ) 10,521 34,896 45,417 33,615 102,908 136,523 Finance lease costs Amortization of leased assets — 404 404 — 1,228 1,228 Interest on lease liabilities — 102 102 — 191 191 — 506 506 — 1,419 1,419 Net lease costs $ 10,521 35,402 45,923 33,615 104,327 137,942 Supplemental balance sheet information related to leases is as follows: Classification At September 28, 2019 Assets Operating Leases Right of use operating lease assets Right of use operating lease assets $ 334,083 Finance Leases Property, plant and equipment, gross Property, plant and equipment 14,727 Accumulated depreciation Accumulated depreciation (2,809 ) Property, plant and equipment, net Property, plant and equipment, net 11,918 Total lease assets $ 346,001 Liabilities Operating Leases Other current Current operating lease liabilities $ 102,682 Non-current Non-current operating lease liabilities 238,560 Total operating liabilities 341,242 Finance Leases Short-term debt Short-term debt and current portion of long-term debt 1,351 Long-term debt Long-term debt, less current portion 11,319 Total finance liabilities 12,670 Total lease liabilities $ 353,912 Maturities of lease liabilities are as follows: Year ending December 31, Finance Leases Operating Leases Total 2019 (excluding the nine months ended September 28, 2019) $ 432 31,316 31,748 2020 1,647 116,032 117,679 2021 1,258 88,122 89,380 2022 1,022 59,951 60,973 2023 926 32,688 33,614 Thereafter 8,987 42,182 51,169 Total lease payments 14,272 370,291 384,563 Less imputed interest 1,602 29,049 Present value, Total $ 12,670 341,242 The Company had approximately $2,709 of leases that commenced after September 28, 2019 that created rights and obligations to the Company. These leases are not included in the above maturity schedule. For additional information regarding the Company’s Commitments and Contingencies as of December 31, 2018 as disclosed for capital and operating leases, see Note 14 in its 2018 Annual Report filed on Form 10-K. Lease term and discount rate are as follows: At September 28, 2019 Weighted Average Remaining Lease Term Operating Leases 4.37 Finance Leases 12.32 Weighted Average Discount Rate Operating Leases 3.3 % Finance Leases 2.4 % Supplemental cash flow information related to leases was as follows: Nine Months Ended September 28, Cash paid for amounts included in measurement of lease liabilities: Operating cash flows from operating leases $ 96,752 Operating cash flows from finance leases 123 Financing cash flows from finance leases 1,224 Right-of-use assets obtained in exchange for lease obligations: Operating Leases 113,253 Finance Leases 7,636 Amortization: Amortization of Right of use operating lease assets (1) 85,061 (1) Amortization of Right of use operating lease assets during the period is reflected in Other assets and prepaid expenses on the Condensed Consolidated Statements of Cash Flows. |
Stock-based compensation
Stock-based compensation | 9 Months Ended |
Sep. 28, 2019 | |
Share-based Payment Arrangement, Noncash Expense [Abstract] | |
Stock-based compensation | Stock-based compensation The Company recognizes compensation expense for all share-based payments granted based on the grant-date fair value estimated in accordance with the provisions of ASC 718-10. Compensation expense is recognized on a straight-line basis over the options’ or other awards’ estimated lives for fixed awards with ratable vesting provisions. The Company granted no restricted stock units (“RSUs”) for the three months ended September 28, 2019 . The Company granted 187 RSUs at a weighted average grant-date fair value of $137.30 per unit for the nine months ended September 28, 2019 . The Company granted 3 RSUs at a weighted average grant-date fair value of $189.39 per unit for the three months ended September 29, 2018 . The Company granted 130 at a weighted average grant-date fair value of $ 236.82 per unit for the nine months ended September 29, 2018 . The Company recognized stock-based compensation costs related to the issuance of RSUs of $5,651 ( $4,182 net of taxes) and $5,104 ( $3,777 net of taxes) for the three months ended September 28, 2019 and September 29, 2018 , respectively, which has been allocated to cost of sales and selling, general and administrative expenses. The Company recognized stock-based compensation costs related to the issuance of RSUs of $17,228 ( $12,749 net of taxes) and $26,697 ( $19,756 net of taxes) for the nine months ended September 28, 2019 and September 29, 2018 , respectively, which has been allocated to cost of sales and selling, general and administrative expenses. Pre-tax unrecognized compensation expense for unvested RSUs granted to employees, net of estimated forfeitures, was $20,598 as of September 28, 2019 , and will be recognized as expense over a weighted-average period of approximately 1.46 years . The Company did not recognize any stock-based compensation costs related to stock options for the nine months ended September 28, 2019 and September 29, 2018 , respectively. |
Other expense (income), net
Other expense (income), net | 9 Months Ended |
Sep. 28, 2019 | |
Other Nonoperating Income (Expense) [Abstract] | |
Other expense (income), net | Other expense (income), net Other expense (income), net is as follows: Three Months Ended Nine Months Ended September 28, September 29, September 28, September 29, Foreign currency losses (gains), net $ (1,181 ) 2,456 (203 ) 7,178 Release of indemnification asset (659 ) — (659 ) 1,749 Impairment of net investment in a manufacturer and distributor of Ceramic tile in China (1) 65,172 — 65,172 — All other, net (10,619 ) (1,750 ) (18,381 ) (2,133 ) Total other expense, net $ 52,713 706 45,929 6,794 (1) During the quarter, the Company determined that its net investment in a manufacturer and distributor of ceramic tile in China was impaired and therefore recorded a net impairment charge of $65,172 . |
Income Taxes
Income Taxes | 9 Months Ended |
Sep. 28, 2019 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes For the quarter ended September 28, 2019 , the Company recorded income tax expense of $22,522 on earnings before income taxes of $178,191 for an effective tax rate of 12.6% , as compared to an income tax expense of $49,487 on earnings before income taxes of $277,513 , for an effective tax rate of 17.8% for the quarter ended September 29, 2018 . For the nine months ended September 28, 2019 , the Company recorded income tax expense of $116,273 on earnings before income taxes of $596,171 for an effective tax rate of 19.5% , as compared to an income tax expense of $215,928 on earnings before income taxes of $850,740 , for an effective tax rate of 25.4% for the nine months ended September 29, 2018 . The difference in the effective tax rates for the comparative periods was caused by the geographical dispersion of profits and losses, a discrete one-time benefit in Q3 of 2019 related to the impairment of the Company's net investment in a manufacturer and distributor of ceramic tile in China, and the issuance of IRS Notice 2018-26 which caused the Company to record $54,674 |
Stockholders' Equity
Stockholders' Equity | 9 Months Ended |
Sep. 28, 2019 | |
Equity [Abstract] | |
Stockholders' Equity | Accumulated other comprehensive income (loss) The changes in accumulated other comprehensive income (loss) by component, for the nine months ended September 28, 2019 are as follows: Foreign currency translation adjustments Pensions, net of tax Total Balance as of December 31, 2018 $ (782,102 ) (9,506 ) (791,608 ) Current period other comprehensive income (90,962 ) 283 (90,679 ) Balance as of September 28, 2019 $ (873,064 ) (9,223 ) (882,287 ) The following tables reflect the changes in stockholders’ equity for the three months ended September 28, 2019 and September 29, 2018 (in thousands). Total Stockholders’ Equity Redeemable Noncontrolling Interest Common Stock Additional Paid-in Capital Retained Earnings Accumulated Other Comprehensive Income (Loss) Treasury Stock Noncontrolling Interest Total Stockholders’ Equity Shares Amount Shares Amount June 29, 2019 $ — 79,712 $ 797 $ 1,859,248 $ 6,903,261 $ (732,521 ) (7,348 ) $ (215,712 ) $ 6,518 $ 7,821,591 Shares issued under employee and director stock plans — — — — — — — — — — Stock-based compensation expense — — — 5,651 — — — — — 5,651 Repurchases of common stock — (519 ) (5 ) — (67,703 ) — — — — (67,708 ) Accretion of redeemable noncontrolling interest — — — — — — — — — — Noncontrolling earnings — — — — — — — — 150 150 Currency translation adjustment on non-controlling interests — — — — — — — — (157 ) (157 ) Currency translation adjustment — — — — — (149,982 ) — — — (149,982 ) Prior pension and post-retirement benefit service cost and actuarial gain / loss — — — — — 216 — — — 216 Net income — — — — 155,518 — — — — 155,518 September 28, 2019 $ — 79,193 $ 792 $ 1,864,899 $ 6,991,076 $ (882,287 ) (7,348 ) $ (215,712 ) $ 6,511 $ 7,765,279 Total Stockholders’ Equity Redeemable Noncontrolling Interest Common Stock Additional Paid-in Capital Retained Earnings Accumulated Other Comprehensive Income (Loss) Treasury Stock Noncontrolling Interest Total Stockholders’ Equity Shares Amount Shares Amount June 30, 2018 $ 30,043 81,952 $ 820 $ 1,842,060 $ 6,409,552 $ (671,133 ) (7,350 ) $ (215,745 ) $ 7,880 $ 7,373,434 Shares issued under employee and director stock plans — — — — — — — — — — Stock-based compensation expense — — — 5,104 — — — — — 5,104 Repurchases of common stock — — — — — — — — — — Accretion of redeemable noncontrolling interest 670 — — — (669 ) — — — — (669 ) Noncontrolling earnings 817 — — — — — — — 195 195 Currency translation adjustment on non-controlling interests (303 ) — — — — — — — (54 ) (54 ) Currency translation adjustment — — — — — (33,314 ) — — — (33,314 ) Prior pension and post-retirement benefit service cost and actuarial gain / loss — — — — — 68 — — — 68 Net income — — — — 227,013 — — — — 227,013 September 29, 2018 $ 31,227 81,952 $ 820 $ 1,847,164 $ 6,635,896 $ (704,379 ) (7,350 ) $ (215,745 ) $ 8,021 $ 7,571,777 The following tables reflect the changes in stockholders’ equity for the nine months ended September 28, 2019 and September 29, 2018 (in thousands). Total Stockholders’ Equity Redeemable Noncontrolling Interest Common Stock Additional Paid-in Capital Retained Earnings Accumulated Other Comprehensive Income (Loss) Treasury Stock Noncontrolling Interest Total Stockholders’ Equity Shares Amount Shares Amount January 1, 2019 $ — 79,656 $ 797 $ 1,852,173 $ 6,588,197 $ (791,608 ) (7,349 ) $ (215,745 ) $ 6,245 $ 7,440,059 Shares issued under employee and director stock plans — 122 1 (4,502 ) — — 1 33 — (4,468 ) Stock-based compensation expense — — — 17,228 — — — — — 17,228 Repurchases of common stock — (585 ) (6 ) — (76,665 ) — — — — (76,671 ) Accretion of redeemable noncontrolling interest — — — — — — — — — — Noncontrolling earnings — — — — — — — — 354 354 Currency translation adjustment on non-controlling interests — — — — — — — — (88 ) (88 ) Currency translation adjustment — — — — — (90,962 ) — — — (90,962 ) Prior pension and post-retirement benefit service cost and actuarial gain / loss — — — — — 283 — — — 283 Net income — — — — 479,544 — — — — 479,544 September 28, 2019 $ — 79,193 $ 792 $ 1,864,899 $ 6,991,076 $ (882,287 ) (7,348 ) $ (215,712 ) $ 6,511 $ 7,765,279 Total Stockholders’ Equity Redeemable Noncontrolling Interest Common Stock Additional Paid-in Capital Retained Earnings Accumulated Other Comprehensive Income (Loss) Treasury Stock Noncontrolling Interest Total Stockholders’ Equity Shares Amount Shares Amount January 1, 2018 $ 29,463 81,771 $ 818 $ 1,828,131 $ 6,004,506 $ (558,527 ) (7,350 ) $ (215,766 ) $ 7,847 $ 7,067,009 Shares issued under employee and director stock plans — 181 2 (7,664 ) — — — 21 — (7,641 ) Stock-based compensation expense — — — 26,697 — — — — — 26,697 Repurchases of common stock — — — — — — — — — — Accretion of redeemable noncontrolling interest 975 — — — (975 ) — — — — (975 ) Noncontrolling earnings 2,043 — — — — — — — 404 404 Currency translation adjustment on non-controlling interests (1,254 ) — — — — — — — (230 ) (230 ) Currency translation adjustment — — — — (146,143 ) — — — (146,143 ) Prior pension and post-retirement benefit service cost and actuarial gain / loss — — — — — 291 — — — 291 Net income — — — — 632,365 — — — — 632,365 September 29, 2018 $ 31,227 81,952 $ 820 $ 1,847,164 $ 6,635,896 $ (704,379 ) (7,350 ) $ (215,745 ) $ 8,021 $ 7,571,777 |
Earnings per share
Earnings per share | 9 Months Ended |
Sep. 28, 2019 | |
Earnings Per Share [Abstract] | |
Earnings per share | Earnings per share Basic earnings per common share is computed by dividing net earnings available to common stockholders by the weighted average number of common shares outstanding during each period. Diluted earnings per common share assumes the exercise of outstanding stock options and the vesting of RSUs using the treasury stock method when the effects of such assumptions are dilutive. A reconciliation of net earnings available to common stockholders and weighted-average common shares outstanding for purposes of calculating basic and diluted earnings per share is as follows: Three Months Ended Nine Months Ended September 28, September 29, September 28, September 29, Net earnings attributable to Mohawk Industries, Inc. $ 155,518 227,013 479,544 632,365 Accretion of redeemable noncontrolling interest (1) — (670 ) — (975 ) Net earnings available to common stockholders $ 155,518 226,343 479,544 631,390 Weighted-average common shares outstanding-basic and diluted: Weighted-average common shares outstanding—basic 72,106 74,603 72,302 74,599 Add weighted-average dilutive potential common shares—options to purchase common shares and RSUs, net 286 342 276 378 Weighted-average common shares outstanding-diluted 72,392 74,945 72,578 74,977 Earnings per share attributable to Mohawk Industries, Inc. Basic $ 2.16 3.03 6.63 8.46 Diluted $ 2.15 3.02 6.61 8.42 (1) Represents the accretion of the Company’s redeemable noncontrolling interest to redemptive value. The holder put this option to the Company on December 20, 2018 for $33,884 . |
Segment reporting
Segment reporting | 9 Months Ended |
Sep. 28, 2019 | |
Segment Reporting [Abstract] | |
Segment reporting | Segment reporting The Company has three reporting segments: the Global Ceramic segment, the Flooring NA segment and the Flooring ROW segment. The Global Ceramic Segment designs, manufactures, sources and markets a broad line of ceramic tile, porcelain tile, natural stone tile and other products including natural stone, quartz and porcelain slab countertops, which it distributes primarily in North America, Europe, Brazil and Russia through various selling channels, which include Company-owned stores, independent distributors, independent retailers, home centers, commercial contractors and commercial end users. The Flooring NA Segment designs, manufactures, sources and markets its floor covering product lines, including carpets, rugs, carpet cushion, wood flooring, laminate and vinyl products, including luxury vinyl tile (LVT), which it distributes to its residential and commercial sales channels through its network of regional distribution centers and satellite warehouses using Company-operated trucks, common carrier or rail transportation. The Segment’s product lines are sold through independent floor covering retailers, independent distributors, home centers, mass merchandisers, department stores, shop at home, online retailers, buying groups, commercial contractors and commercial end users. The Flooring ROW Segment designs, manufactures, sources, licenses and markets laminate, wood flooring, carpets, roofing elements, insulation boards, medium-density fiberboard (“MDF”), chipboards, other wood products and vinyl products, including LVT, which it distributes primarily in Europe, Russia, Australia and New Zealand through various selling channels, which include independent floor covering retailers, independent distributors, company-owned distributors, home centers, commercial contractors and commercial end users. The accounting policies for each operating segment are consistent with the Company’s policies for the consolidated financial statements. Amounts disclosed for each segment are prior to any elimination or consolidation entries. Corporate general and administrative expenses attributable to each segment are estimated and allocated accordingly. Segment performance is evaluated based on operating income. Segment information is as follows: Three Months Ended Nine Months Ended September 28, September 29, September 28, September 29, Net sales: Global Ceramic segment $ 916,422 885,773 2,772,805 2,691,618 Flooring NA segment 1,001,908 1,047,540 2,907,327 3,055,468 Flooring ROW segment 600,855 612,487 1,866,028 1,787,930 Intersegment sales — — — — Total $ 2,519,185 2,545,800 7,546,160 7,535,016 Operating income (loss): Global Ceramic segment $ 84,410 118,716 286,886 366,893 Flooring NA segment 80,223 93,369 140,374 268,779 Flooring ROW segment 84,428 84,108 276,392 273,334 Corporate and intersegment eliminations (8,841 ) (8,949 ) (31,242 ) (27,056 ) Total $ 240,220 287,244 672,410 881,950 At September 28, 2019 At December 31, 2018 Assets: Global Ceramic segment $ 5,385,279 5,194,030 Flooring NA segment 4,020,205 3,938,639 Flooring ROW segment 3,736,296 3,666,617 Corporate and intersegment eliminations 250,982 299,837 Total $ 13,392,762 13,099,123 |
Commitments and contingencies
Commitments and contingencies | 9 Months Ended |
Sep. 28, 2019 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and contingencies | Commitments and contingencies The Company is involved in litigation from time to time in the regular course of its business. Except as noted below, there are no material legal proceedings pending or known by the Company to be contemplated to which the Company is a party or to which any of its property is subject. Alabama Municipal Litigation In September 2016, the Water Works and Sewer Board of the City of Gadsden, Alabama (the “Gadsden Water Board”) filed an individual complaint in the Circuit Court of Etowah County, Alabama against certain manufacturers, suppliers, and users of chemicals containing specific perfluorinated compounds, including the Company. On October 26, 2016, the defendants removed the case to the United States District Court for the Northern District of Alabama, Middle Division, alleging diversity of citizenship and fraudulent joinder. The Gadsden Water Board filed a motion to remand the case back to the state court, and the defendants opposed the Gadsden Water Board’s motion. The federal court granted Gadsden Water Board’s motion for remand. In May 2017, the Water Works and Sewer Board of the Town of Centre, Alabama (the “Centre Water Board”) filed a very similar complaint to the Gadsden Water Board complaint in the Circuit Court of Cherokee County. On June 19, 2017, the defendants removed this case to the United States District Court for the Northern District of Alabama, Middle Division, again alleging diversity of citizenship and fraudulent joinder. The Centre Water Board filed a motion to remand the case back to state court, and the defendants opposed the Centre Water Board’s motion. The federal court granted Centre Water Board's motion for remand. Certain defendants, including the Company, filed dispositive motions in each case arguing that the state court lacks personal jurisdiction over them. Both state courts denied those motions. In June and September 2018, certain defendants, including the Company, petitioned the Alabama Supreme Court for Writs of Mandamus directing each lower court to enter an order granting the defendants’ dispositive motions on personal jurisdiction grounds. Those petitions have been fully briefed and the Company awaits a decision from the Alabama Supreme Court. The Company has never manufactured the perfluorinated compounds at issue but purchased them for use in the manufacture of its carpets prior to 2007. The Gadsden and Centre Water Boards are not alleging that chemical levels in the Company’s wastewater discharge exceeded legal limits. Instead, the Gadsden and Centre Water Boards are seeking lost profits based on allegations that their customers decreased water purchases, as well as reimbursement for the cost of a filter and punitive damages. Belgian Tax Matter Between 2012 and 2014, the Company received assessments from the Belgian tax authority for the calendar years 2005 through 2010 in the amounts of € 46,135 , €38,817 , €39,635 , € 30,131 , € 35,567 and €43,117 respectively, including penalties, but excluding interest. The Belgian tax authority denied the Company’s formal protests against these assessments and the Company brought all six years before the Court of First Appeal in Bruges. The Court of First Appeal in Bruges ruled in favor of the Company on January 27, 2016, with respect to the calendar years ending December 31, 2005 and December 31, 2009; and on June 13, 2018, the Court of First Appeal in Bruges ruled in favor of the Company with respect to the calendar years ending December 31, 2006, December 31, 2007, December 31, 2008 and December 31, 2010. The Belgian tax authority has lodged its Notification of Appeal for all six years with the Ghent Court of Appeal. On September 17, 2019, the Company pled its case to the Ghent Court of Special (Tax) Appeals and on October 1, 2019, the Court ruled in favor of the Company, re-confirming the rulings of the Court of First Appeals in Bruges with respect to the calendar years ending December 31, 2005 and December 31, 2009. The Belgian Tax Authority has three months within which to appeal to the Belgium Supreme Court. In March 2019, the Company received assessments from the Belgian tax authority for tax years 2011 through 2017 in the amount of € 40,617 , € 39,732 , € 11,358 , € 23,919 , € 30,610 , € 93,145 and € 79,933 respectively, including penalties, but excluding interest. The Company intends to file formal protests based on these assessments in a timely manner. The assessments are largely based on the same facts underlying the positive rulings, which the Belgian tax authority may appeal. The Company continues to disagree with the views of the Belgian tax authority on this matter and will persist in its vigorous defense. Nevertheless, on May 24, 2016, the tax collector representing the Belgian tax authorities imposed a lien on the Company’s properties in Wielsbeke (Ooigemstraat and Breestraat), Oostrozebeke (Ingelmunstersteenweg) and Desselgem (Waregemstraat) included in the Flooring ROW segment. The purpose of the lien is to provide security for payment should the Belgian tax authority prevail on its appeal. The lien does not interfere with the Company’s operations at these properties. General |
Debt
Debt | 9 Months Ended |
Sep. 28, 2019 | |
Debt Disclosure [Abstract] | |
Debt | Debt Senior Credit Facility On March 26, 2015, the Company amended and restated its 2013 senior credit facility increasing its size from $1,000,000 to $1,800,000 and extending the maturity from September 25, 2018 to March 26, 2020 (as amended and restated, the “2015 Senior Credit Facility”). The 2015 Senior Credit Facility eliminated certain provisions in the 2013 Senior Credit Facility, including those that: (a) accelerated the maturity date to 90 days prior to the maturity of senior notes due in January 2016 if certain specified liquidity levels were not met; and (b) required that certain subsidiaries guarantee the Company’s obligations if the Company’s credit ratings fell below investment grade. The 2015 Senior Credit Facility also modified certain negative covenants to provide the Company with additional flexibility, including flexibility to make acquisitions and incur additional indebtedness. On March 1, 2016, the Company amended the 2015 Senior Credit Facility to, among other things, carve out from the general limitation on subsidiary indebtedness the issuance of Euro-denominated commercial paper notes by subsidiaries. Additionally, at several points in 2016, the Company extended the maturity date of the 2015 Senior Credit Facility from March 26, 2020 to March 26, 2021. In the first half of 2017, the Company amended the 2015 Senior Credit Facility to extend the maturity date from March 26, 2021 to March 26, 2022. At the Company’s election, revolving loans under the 2015 Senior Credit Facility bear interest at annual rates equal to either (a) LIBOR for 1, 2, 3 or 6 month periods, as selected by the Company, plus an applicable margin ranging between 1.00% and 1.75% ( 1.125% as of September 28, 2019 ), or (b) the higher of the Wells Fargo Bank, National Association prime rate, the Federal Funds rate plus 0.5% , or the Eurocurrency Rate (as defined in the 2015 Senior Credit Facility) rate plus 1.0% , plus an applicable margin ranging between 0.00% and 0.75% ( 0.125% as of September 28, 2019 ). The Company also pays a commitment fee to the lenders under the 2015 Senior Credit Facility on the average amount by which the aggregate commitments of the lenders exceed utilization of the 2015 Senior Credit Facility ranging from 0.10% to 0.225% per annum ( 0.125% as of September 28, 2019 ). The applicable margins and the commitment fee are determined based on whichever of the Company’s Consolidated Net Leverage Ratio or its senior unsecured debt rating (or if not available, corporate family rating) results in the lower applicable margins and commitment fee (with applicable margins and the commitment fee increasing as that ratio increases or those ratings decline, as applicable). The obligations of the Company and its subsidiaries in respect of the 2015 Senior Credit Facility are unsecured. The 2015 Senior Credit Facility includes certain affirmative and negative covenants that impose restrictions on the Company’s financial and business operations, including limitations on liens, subsidiary indebtedness, fundamental changes, asset dispositions, dividends and other similar restricted payments, transactions with affiliates, future negative pledges, and changes in the nature of the Company’s business. The Company is also required to maintain a Consolidated Interest Coverage Ratio of at least 3.0 to 1.0 and a Consolidated Net Leverage Ratio of no more than 3.75 to 1.0, each as of the last day of any fiscal quarter. The limitations contain customary exceptions or, in certain cases, do not apply as long as the Company is in compliance with the financial ratio requirements and is not otherwise in default. The 2015 Senior Credit Facility also contains customary representations and warranties and events of default, subject to customary grace periods. In 2017, the Company paid financing costs of $567 in connection with the extension of its 2015 Senior Credit Facility from March 26, 2021 to March 26, 2022. These costs were deferred and, along with unamortized costs of $6,873 are being amortized over the term of the 2015 Senior Credit Facility. As of September 28, 2019 , amounts utilized under the 2015 Senior Credit Facility included $2,500 of borrowings and $22,787 of standby letters of credit related to various insurance contracts and foreign vendor commitments. The outstanding borrowings of $932,776 under the Company’s U.S. and European commercial paper programs as of September 28, 2019 reduce the availability of the 2015 Senior Credit Facility. Including commercial paper borrowings, the Company has utilized $958,063 under the 2015 Senior Credit Facility resulting in a total of $841,937 available as of September 28, 2019 . Senior Credit Facility Subsequent Event On October 18, 2019, the Company amended and restated its 2015 Senior Credit Facility, extending the maturity from March 26, 2022 to October 17, 2024 (as amended and restated, the “2019 Senior Credit Facility”). The modifications also included (but were not limited to) renewing the Company’s option to extend the maturity of the 2019 Senior Credit Facility up to two times for an additional one-year period each, reducing commitment fees, and modifying certain of the negative covenants to provide the Company with additional flexibility, including additional flexibility to make acquisitions and incur indebtedness. Commercial Paper On February 28, 2014 and July 31, 2015 , the Company established programs for the issuance of unsecured commercial paper in the United States and Eurozone capital markets, respectively. Commercial paper issued under the U.S. and European programs will have maturities ranging up to 397 and 183 days, respectively. None of the commercial paper notes may be voluntarily prepaid or redeemed by the Company and all rank pari passu with all of the Company’s other unsecured and unsubordinated indebtedness. To the extent that the Company issues European commercial paper notes through a subsidiary of the Company, the notes will be fully and unconditionally guaranteed by the Company. The Company uses its 2015 Senior Credit Facility as a liquidity backstop for its commercial paper programs. Accordingly, the total amount outstanding under all of the Company’s commercial paper programs may not exceed $1,800,000 (less any amounts drawn on the 2015 Senior Credit Facility) at any time. The proceeds from the issuance of commercial paper notes will be available for general corporate purposes. As of September 28, 2019 , there was $409,800 outstanding under the U.S. commercial paper program, and the euro equivalent of $522,976 under the European program. The weighted-average interest rate and maturity period for the U.S. program were 2.32% and 25.07 days, respectively. The weighted average interest rate and maturity period for the European program were (0.22)% and 30.7 days, respectively. Senior Notes On September 4, 2019 , Mohawk Capital Finance S.A. (“Mohawk Finance”), an indirect wholly-owned finance subsidiary of the Company, completed the issuance and sale of €300,000 aggregate principal amount of its Floating Rate Notes due September 4, 2021 (“2021 Floating Rate Notes”). The 2021 Floating Rate Notes are senior unsecured obligations of Mohawk Finance and rank pari passu with all of Mohawk Finance’s other existing and future senior unsecured indebtedness. The 2021 Floating Rate Notes are fully, unconditionally and irrevocably guaranteed by the Company on a senior unsecured basis. These notes bear interest at a rate per annum, reset quarterly, equal to three-month EURIBOR plus 0.2% (but in no event shall the interest rate be less than zero). Interest on the 2021 Floating Rate Notes is payable quarterly on December 4 , March 4 , June 4 , and September 4 of each year. Mohawk Finance received an issuance premium of €744 and paid financing cost of $754 in connection with the 2021 Floating Rate Notes. The issuance premium and financing costs have been deferred and are being amortized over the term of the 2021 Floating Rate Notes. On May 18, 2018 , Mohawk Finance, an indirect wholly-owned finance subsidiary of the Company, completed the issuance and sale of €300,000 aggregate principal amount of its Floating Rate Notes due May 18, 2020 (“2020 Floating Rate Notes”). The 2020 Floating Rate Notes are senior unsecured obligations of Mohawk Finance and rank pari passu with all of Mohawk Finance’s other existing and future senior unsecured indebtedness. The 2020 Floating Rate Notes are fully, unconditionally and irrevocably guaranteed by the Company on a senior unsecured basis. These notes bear interest at a rate per annum, reset quarterly, equal to three-month EURIBOR plus 0.3% (but in no event shall the interest rate be less than zero). Interest on the 2020 Floating Rate Notes is payable quarterly on August 18 , November 18 , February 18 , and May 18 of each year. Mohawk Finance paid financing costs of $890 in connection with the 2020 Floating Rate Notes. These costs were deferred and are being amortized over the term of the 2020 Floating Rate Notes. On September 11, 2017 , Mohawk Finance completed the issuance and sale of €300,000 aggregate principal amount of its Floating Rate Notes due September 11, 2019 (“2019 Floating Rate Notes”). The 2019 Floating Rate Notes are senior unsecured obligations of Mohawk Finance and rank pari passu with all of Mohawk Finance’s other existing and future senior unsecured indebtedness. The 2019 Floating Rate Notes are fully, unconditionally and irrevocably guaranteed by the Company on a senior unsecured basis. These notes bear interest at a rate per annum, reset quarterly, equal to three-month EURIBOR plus 0.3% (but in no event shall the interest rate be less than zero). Interest on the 2019 Floating Rate Notes is payable quarterly on September 11 , December 11 , March 11 , and June 11 of each year. Mohawk Finance paid financing costs of $911 in connection with the 2019 Floating Rate Notes. These costs were deferred and are being amortized over the term of the 2019 Floating Rate Notes. On September 11, 2019, the Company paid the remaining €300,000 outstanding principal of the 2019 Floating Rate Notes utilizing cash on hand and borrowings under its European commercial paper program. On June 9, 2015, the Company issued €500,000 aggregate principal amount of 2.00% Senior Notes (“ 2.00% Senior Notes”) due January 14, 2022 . The 2.00% Senior Notes are senior unsecured obligations of the Company and rank pari passu with all of the Company’s existing and future unsecured indebtedness. Interest on the 2.00% Senior Notes is payable annually in cash on January 14 of each year, commencing on January 14, 2016. The Company paid financing costs of $4,218 in connection with the 2.00% Senior Notes. These costs were deferred and are being amortized over the term of the 2.00% Senior Notes. On January 31, 2013, the Company issued $600,000 aggregate principal amount of 3.85% Senior Notes (“ 3.85% Senior Notes”) due February 1, 2023 . The 3.85% Senior Notes are senior unsecured obligations of the Company and rank pari passu with all of the Company’s existing and future unsecured indebtedness. Interest on the 3.85% Senior Notes is payable semi-annually in cash on February 1 and August 1 of each year. The Company paid financing costs of $6,000 in connection with the 3.85% Senior Notes. These costs were deferred and are being amortized over the term of the 3.85% Senior Notes. As defined in the related agreements, the Company’s senior notes contain covenants, representations and warranties and events of default, subject to exceptions, and restrictions on the Company’s financial and business operations, including limitations on liens, restrictions on entering into sale and leaseback transactions, fundamental changes, and a provision allowing the holder of the notes to require repayment upon a change of control triggering event. The fair values and carrying values of our debt instruments are detailed as follows: At September 28, 2019 At December 31, 2018 Fair Value Carrying Value Fair Value Carrying Value 3.85% senior notes, payable February 1, 2023; interest payable semiannually $ 626,491 600,000 599,904 600,000 2.00% senior notes, payable January 14, 2022; interest payable annually 569,037 547,046 587,487 572,148 Floating Rate Notes, payable May 18, 2020, interest payable quarterly 328,002 328,228 343,004 343,289 Floating Rate Notes, payable September 11, 2019, interest payable quarterly — — 343,560 343,289 Floating rate notes, payable September 04, 2021, interest payable quarterly 324,650 328,228 — — U.S. commercial paper 409,800 409,800 632,668 632,668 European commercial paper 522,976 522,976 707,175 707,175 Five-year senior secured credit facility, due March 26, 2022 2,500 2,500 57,896 57,896 Capital leases and other 21,469 21,469 6,664 6,664 Unamortized debt issuance costs (3,508 ) (3,508 ) (5,155 ) (5,155 ) Total debt 2,801,417 2,756,739 3,273,203 3,257,974 Less current portion of long-term debt and commercial paper 1,273,158 1,273,158 1,742,373 1,742,373 Long-term debt, less current portion $ 1,528,259 1,483,581 1,530,830 1,515,601 The fair values of the Company’s debt instruments were estimated using market observable inputs, including quoted prices in active markets, market indices and interest rate measurements. Within the hierarchy of fair value measurements, these are Level 2 fair values. |
Subsequent Event
Subsequent Event | 9 Months Ended |
Sep. 28, 2019 | |
Subsequent Events [Abstract] | |
Subsequent Event | Subsequent Event On October 18, 2019, the Company amended and restated its 2015 Senior Credit Facility, extending the maturity from March 26, 2022 to October 17, 2024 (as amended and restated, the “2019 Senior Credit Facility”). The modifications also included (but were not limited to) renewing the Company’s option to extend the maturity of the 2019 Senior Credit Facility up to two |
General (Policies)
General (Policies) | 9 Months Ended |
Sep. 28, 2019 | |
Accounting Policies [Abstract] | |
Interim Reporting | Interim Reporting The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with instructions to Form 10-Q and do not include all of the information and footnotes required by U.S. generally accepted accounting principles (“U.S. GAAP”) for complete financial statements. In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation have been included. These statements should be read in conjunction with the consolidated financial statements and notes thereto, and the Company’s description of critical accounting policies, included in the Company’s 2018 |
Hedges of Net Investments in Non-U.S. Operations | Hedges of Net Investments in Non-U.S. Operations |
Recent Accounting Pronouncements | Recent Accounting Pronouncements - Recently Adopted In February 2016, the FASB issued a new standard ASU 2016-02, Leases , and subsequently issued additional ASUs amending this ASU (collectively ASC 842, Leases ). ASC 842 was issued to increase transparency and comparability among organizations by requiring the recognition of right of use (“ROU”) assets and lease liabilities on the balance sheet. Most prominent among the changes in the standard is the recognition of ROU assets and lease liabilities by lessees for those leases classified as operating leases. Under the standard, disclosures are required to meet the objective of enabling users of financial statements to assess the amount, timing, and uncertainty of cash flows arising from leases. The Company adopted the provisions of ASC 842 on January 1, 2019 using a modified retrospective approach through a cumulative effect adjustment to retained earnings as of the beginning of the period of adoption in line with the new transition method allowed under ASU 2018-11. ASC 842 provides a number of optional practical expedients in transition. The Company elected the “package of practical expedients” which permits the Company not to reassess under the new standard its prior conclusions about lease identification, lease classification and initial direct costs. The Company did not elect the use-of-hindsight and elected the practical expedient pertaining to land easements. The new standard also provides practical expedients for an entity’s ongoing accounting for leases. The Company elected the short-term lease exemption for all leases that qualify, meaning the Company will not recognize ROU assets or lease liabilities for leases with terms shorter than twelve months. The Company also elected the practical expedient to not separate lease and non-lease components for a majority of its asset classes, including real estate and most equipment. The adoption of ASC 842 had a material impact on the Company’s condensed consolidated balance sheets, but did not have a material impact on our condensed consolidated statements of operations or cashflow. The most significant impact was the recognition of ROU assets of $328,169 and lease liabilities for operating leases of $332,286 at January 1, 2019, based on the present value of the future minimum rental payments for existing operating leases. The difference in the balances is due to deferred rent, tenant incentive allowances and prepaid amounts taken into account for adoption. Our accounting for finance leases remained substantially unchanged, See Note 10 - Leases. On January 1, 2019, the Company adopted the new accounting standard, ASU 2018-02, Reclassification of Certain Tax Effects from Accumulated Other Comprehensive Income . The standard permits entities to reclassify, to retained earnings, the one-time income tax effects stranded in accumulated other comprehensive income arising from the change in the U.S. federal corporate tax rate as a result of the Tax Cuts and Jobs Act of 2017. The effect of adopting the new standard was not material. On January 1, 2018, the Company adopted the new accounting standard, ASC 606, Revenue from Contracts with Customers and all the related amendments (“ASC 606”) and applied the provisions of the standard to all contracts using the modified retrospective method. The cumulative effect of adopting the new revenue standard was immaterial and no adjustment has been recorded to the opening balance of retained earnings. Prior year information has not been restated and continues to be reported under the accounting standards in effect for those periods. Substantially all of the Company’s revenue continues to be recognized at a point in time when the product is either shipped or received from the Company’s facilities and control of the product is transferred to the customer. The Company reviewed all of its revenue product categories under ASC 606 and the only changes identified were that an immaterial amount of revenue from intellectual property (“IP”) contracts results in earlier recognition of revenue, new controls and processes designed to meet the requirements of the standard were implemented, and the required new disclosures are presented in Note 3, Revenue from Contracts with Customers. The adoption of ASC 606 did not have a material impact on the amounts reported in the Company’s consolidated financial position, results of operations or cash flows. On January 1, 2018, the Company adopted the new accounting standard, ASU 2016-15, Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments. The effect of adopting the new standard was not material. On January 1, 2018, the Company adopted the new accounting standard, ASU 2017-01, Business Combinations (Topic 805): Clarifying the Definition of a Business. The effect of adopting the new standard was not material. Recent Accounting Pronouncements - Effective in Future Years In January 2017, the FASB issued ASU 2017-04, Intangibles - Goodwill and other (Topic 350): Simplifying the test for goodwill impairment. The amendments remove the second step of the current goodwill impairment test. An entity will apply a one-step quantitative test and record the amount of goodwill impairment as the excess of a reporting unit's carrying amount over its fair value, not to exceed the total amount of goodwill allocated to the reporting unit. The new guidance does not amend the optional qualitative assessment of goodwill impairment. This guidance is effective for impairment tests in fiscal years beginning after December 15, 2019. Currently, the Company is assessing the impact of the new guidance. The Company does not expect the adoption of the guidance to have a significant impact on its financial statements. In June 2016, the FASB issued ASU 2016-13, Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments and in November 2018 issued ASU 2018-19, which amended the standard. The standard introduces an approach, based on expected losses, to estimate credit losses on certain types of financial instruments and modifies the impairment model for available-for-sale debt securities. The new approach to estimating credit losses (referred to as the current expected credit losses model) applies to most financial assets measured at amortized cost and certain other instruments, including trade and other receivables, loans, held-to-maturity debt securities, net investments in leases and off-balance-sheet credit exposures. This standard is effective for the Company on January 1, 2020. Entities are required to apply the standard’s provisions as a cumulative-effect adjustment to retained earnings as of the beginning of the first reporting period in which the guidance is adopted. Currently, the Company is assessing the impact of the new guidance. The Company does not expect the adoption of the guidance to have a significant impact on its financial statements. |
Revenue from Contracts with C_2
Revenue from Contracts with Customers (Tables) | 9 Months Ended |
Sep. 28, 2019 | |
Revenue from Contract with Customer [Abstract] | |
Summary of segment revenues disaggregated by geography and product line | The following table presents the Company’s segment revenues disaggregated by the geographical market location of customer sales and product categories for the three months ended September 28, 2019 and September 29, 2018 : September 28, 2019 Global Ceramic segment Flooring NA segment Flooring ROW segment Total Geographical Markets United States $ 537,247 963,784 475 1,501,506 Europe 168,032 1,901 424,230 594,163 Russia 77,024 15 32,614 109,653 Other 134,119 36,208 143,536 313,863 $ 916,422 1,001,908 600,855 2,519,185 Product Categories Ceramic & Stone $ 916,422 13,570 — 929,992 Carpet & Resilient — 816,190 193,941 1,010,131 Laminate & Wood — 172,148 204,241 376,389 Other (1) — — 202,673 202,673 $ 916,422 1,001,908 600,855 2,519,185 September 29, 2018 Global Ceramic segment Flooring NA segment Flooring ROW segment Total Geographical Markets United States $ 565,616 998,488 421 1,564,525 Europe 175,026 1,217 438,585 614,828 Russia 68,113 — 27,435 95,548 Other 77,018 47,835 146,046 270,899 $ 885,773 1,047,540 612,487 2,545,800 Product Categories Ceramic & Stone $ 885,773 16,779 — 902,552 Carpet & Resilient — 851,970 192,001 1,043,971 Laminate & Wood — 178,791 200,499 379,290 Other (1) — — 219,987 219,987 $ 885,773 1,047,540 612,487 2,545,800 (1) Other includes roofing elements, insulation boards, chipboards and IP contracts. The following table presents the Company’s segment revenues disaggregated by the geographical market location of customer sales and product categories for the nine months ended September 28, 2019 and September 29, 2018 : September 28, 2019 Global Ceramic segment Flooring NA segment Flooring ROW segment Total Geographical Markets United States $ 1,633,583 2,793,110 1,252 4,427,945 Europe 552,546 5,902 1,369,908 1,928,356 Russia 196,731 66 83,315 280,112 Other 389,945 108,249 411,553 909,747 $ 2,772,805 2,907,327 1,866,028 7,546,160 Product Categories Ceramic & Stone $ 2,772,805 41,928 — 2,814,733 Carpet & Resilient — 2,360,014 586,388 2,946,402 Laminate & Wood — 505,385 629,500 1,134,885 Other (1) — — 650,140 650,140 $ 2,772,805 2,907,327 1,866,028 7,546,160 September 29, 2018 Global Ceramic segment Flooring NA segment Flooring ROW segment Total Geographical Markets United States $ 1,700,338 2,920,604 421 4,621,363 Europe 573,932 4,737 1,424,113 2,002,782 Russia 183,244 — 73,417 256,661 Other 234,104 130,127 289,979 654,210 $ 2,691,618 3,055,468 1,787,930 7,535,016 Product Categories Ceramic & Stone $ 2,691,618 52,500 — 2,744,118 Carpet & Resilient — 2,466,695 453,597 2,920,292 Laminate & Wood — 536,273 643,389 1,179,662 Other (1) — — 690,944 690,944 $ 2,691,618 3,055,468 1,787,930 7,535,016 (1) Other includes roofing elements, insulation boards, chipboards and IP contracts. |
Restructuring, acquisition an_2
Restructuring, acquisition and integration-related costs (Tables) | 9 Months Ended |
Sep. 28, 2019 | |
Restructuring and Related Activities [Abstract] | |
Schedule of restructuring reserve by type of cost | Restructuring, acquisition transaction and integration-related costs consisted of the following during the three and nine months ended September 28, 2019 and September 29, 2018 : Three Months Ended Nine Months Ended September 28, 2019 September 29, 2018 September 28, 2019 September 29, 2018 Cost of sales Restructuring costs (1) $ 7,284 10,004 43,197 33,425 Acquisition integration-related costs 180 198 2,736 3,293 Restructuring and acquisition integration-related costs $ 7,464 10,202 45,933 36,718 Selling, general and administrative expenses Restructuring costs (1) $ 491 1,476 2,336 9,366 Acquisition transaction-related costs 413 3,032 1,330 3,095 Acquisition integration-related costs 1,147 5,180 4,554 8,857 Restructuring, acquisition transaction and integration-related costs $ 2,051 9,688 8,220 21,318 (1) The restructuring costs for 2019 and 2018 primarily relate to the Company’s actions taken to lower its cost structure and improve efficiencies of manufacturing and distribution operations as well as actions related to the Company’s recent acquisitions. |
Schedule of restructuring and related costs | The restructuring activity for the nine months ended September 28, 2019 is as follows: Lease impairments Asset write-downs Severance Other restructuring costs Total Balance as of December 31, 2018 $ 397 — 7,866 250 8,513 Provision - Global Ceramic segment — — 4,879 — 4,879 Provision - Flooring NA segment — 21,791 1,168 12,087 35,046 Provision - Flooring ROW segment — 2,515 2,367 726 5,608 Cash payments (361 ) — (11,715 ) (12,702 ) (24,778 ) Non-cash items — (24,306 ) (130 ) (111 ) (24,547 ) Balance as of September 28, 2019 $ 36 — 4,435 250 4,721 |
Receivables, net (Tables)
Receivables, net (Tables) | 9 Months Ended |
Sep. 28, 2019 | |
Receivables [Abstract] | |
Schedule of net components of receivables | Receivables, net are as follows: At September 28, 2019 At December 31, 2018 Customers, trade $ 1,763,435 1,562,284 Income tax receivable 15,781 17,217 Other 78,399 101,376 1,857,615 1,680,877 Less: allowance for discounts, claims and doubtful accounts 70,457 74,718 Receivables, net $ 1,787,158 1,606,159 |
Inventories (Tables)
Inventories (Tables) | 9 Months Ended |
Sep. 28, 2019 | |
Inventory Disclosure [Abstract] | |
Schedule of net components of inventories | The components of inventories are as follows: At September 28, 2019 At December 31, 2018 Finished goods $ 1,637,525 1,582,112 Work in process 150,089 165,616 Raw materials 550,338 539,887 Total inventories $ 2,337,952 2,287,615 |
Goodwill and intangible assets
Goodwill and intangible assets (Tables) | 9 Months Ended |
Sep. 28, 2019 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of goodwill | The components of goodwill and other intangible assets are as follows: Goodwill: Global Ceramic segment Flooring NA segment Flooring ROW segment Total Balance as of December 31, 2018 Goodwill $ 1,564,987 874,198 1,409,206 3,848,391 Accumulated impairment losses (531,930 ) (343,054 ) (452,441 ) (1,327,425 ) 1,033,057 531,144 956,765 2,520,966 Goodwill recognized during the period (1,758 ) — 47,543 45,785 Currency translation during the period (2,740 ) — (44,797 ) (47,537 ) Balance as of September 28, 2019 Goodwill 1,560,489 874,198 1,411,952 3,846,639 Accumulated impairment losses (531,930 ) (343,054 ) (452,441 ) (1,327,425 ) $ 1,028,559 531,144 959,511 2,519,214 |
Schedule of indefinite life assets not subject to amortization | Intangible assets not subject to amortization: Tradenames Balance as of December 31, 2018 $ 707,380 Intangible assets acquired during the period (874 ) Currency translation during the period (16,718 ) Balance as of September 28, 2019 $ 689,788 |
Schedule of intangible assets subject to amortization | Intangible assets subject to amortization: Gross carrying amounts: Customer Patents Other Total Balance as of December 31, 2018 $ 651,012 254,483 6,535 912,030 Intangible assets recognized during the period 2,092 — — 2,092 Currency translation during the period (20,143 ) (11,213 ) (173 ) (31,529 ) Balance as of September 28, 2019 $ 632,961 243,270 6,362 882,593 Accumulated amortization: Customer Patents Other Total Balance as of December 31, 2018 $ 406,386 249,988 1,227 657,601 Amortization during the period 19,027 1,606 (37 ) 20,596 Currency translation during the period (11,722 ) (11,028 ) (19 ) (22,769 ) Balance as of September 28, 2019 $ 413,691 240,566 1,171 655,428 Intangible assets subject to amortization, net $ 219,270 2,704 5,191 227,165 |
Schedule of intangible assets amortization expense | Three Months Ended Nine Months Ended September 28, September 29, September 28, September 29, Amortization expense $ 6,912 8,148 20,596 23,198 |
Accounts payable and accrued _2
Accounts payable and accrued expenses (Tables) | 9 Months Ended |
Sep. 28, 2019 | |
Payables and Accruals [Abstract] | |
Components of accounts payable and accrued expenses | Accounts payable and accrued expenses are as follows: At September 28, 2019 At December 31, 2018 Outstanding checks in excess of cash $ 4,064 14,624 Accounts payable, trade 964,098 811,879 Accrued expenses 490,094 430,431 Product warranties 46,984 47,511 Accrued interest 12,293 21,908 Accrued compensation and benefits 221,326 197,513 Total accounts payable and accrued expenses $ 1,738,859 1,523,866 |
Accumulated other comprehensi_2
Accumulated other comprehensive income (loss) (Tables) | 9 Months Ended |
Sep. 28, 2019 | |
Equity [Abstract] | |
Schedule of accumulated other comprehensive income (loss) | The changes in accumulated other comprehensive income (loss) by component, for the nine months ended September 28, 2019 are as follows: Foreign currency translation adjustments Pensions, net of tax Total Balance as of December 31, 2018 $ (782,102 ) (9,506 ) (791,608 ) Current period other comprehensive income (90,962 ) 283 (90,679 ) Balance as of September 28, 2019 $ (873,064 ) (9,223 ) (882,287 ) |
Leases (Tables)
Leases (Tables) | 9 Months Ended |
Sep. 28, 2019 | |
Leases [Abstract] | |
Schedule of components of lease expense, lease term, and discount rate | Lease term and discount rate are as follows: At September 28, 2019 Weighted Average Remaining Lease Term Operating Leases 4.37 Finance Leases 12.32 Weighted Average Discount Rate Operating Leases 3.3 % Finance Leases 2.4 % The components of lease costs are as follows: Three Months Ended September 28, 2019 Nine Months Ended September 28, 2019 Cost of Goods Sold Selling, General and Administrative Total Cost of Goods Sold Selling, General and Administrative Total Operating lease costs Fixed $ 8,068 25,316 33,384 23,925 72,578 96,503 Short-term 1,092 2,640 3,732 4,083 9,126 13,209 Variable 1,475 7,053 8,528 5,846 21,601 27,447 Sub-leases (114 ) (113 ) (227 ) (239 ) (397 ) (636 ) 10,521 34,896 45,417 33,615 102,908 136,523 Finance lease costs Amortization of leased assets — 404 404 — 1,228 1,228 Interest on lease liabilities — 102 102 — 191 191 — 506 506 — 1,419 1,419 Net lease costs $ 10,521 35,402 45,923 33,615 104,327 137,942 |
Schedule of supplemental balance sheet information | Supplemental balance sheet information related to leases is as follows: Classification At September 28, 2019 Assets Operating Leases Right of use operating lease assets Right of use operating lease assets $ 334,083 Finance Leases Property, plant and equipment, gross Property, plant and equipment 14,727 Accumulated depreciation Accumulated depreciation (2,809 ) Property, plant and equipment, net Property, plant and equipment, net 11,918 Total lease assets $ 346,001 Liabilities Operating Leases Other current Current operating lease liabilities $ 102,682 Non-current Non-current operating lease liabilities 238,560 Total operating liabilities 341,242 Finance Leases Short-term debt Short-term debt and current portion of long-term debt 1,351 Long-term debt Long-term debt, less current portion 11,319 Total finance liabilities 12,670 Total lease liabilities $ 353,912 |
Schedule of finance lease maturities | Maturities of lease liabilities are as follows: Year ending December 31, Finance Leases Operating Leases Total 2019 (excluding the nine months ended September 28, 2019) $ 432 31,316 31,748 2020 1,647 116,032 117,679 2021 1,258 88,122 89,380 2022 1,022 59,951 60,973 2023 926 32,688 33,614 Thereafter 8,987 42,182 51,169 Total lease payments 14,272 370,291 384,563 Less imputed interest 1,602 29,049 Present value, Total $ 12,670 341,242 |
Schedule of operating lease maturities | Maturities of lease liabilities are as follows: Year ending December 31, Finance Leases Operating Leases Total 2019 (excluding the nine months ended September 28, 2019) $ 432 31,316 31,748 2020 1,647 116,032 117,679 2021 1,258 88,122 89,380 2022 1,022 59,951 60,973 2023 926 32,688 33,614 Thereafter 8,987 42,182 51,169 Total lease payments 14,272 370,291 384,563 Less imputed interest 1,602 29,049 Present value, Total $ 12,670 341,242 |
Schedule of supplemental cash flow information | Supplemental cash flow information related to leases was as follows: Nine Months Ended September 28, Cash paid for amounts included in measurement of lease liabilities: Operating cash flows from operating leases $ 96,752 Operating cash flows from finance leases 123 Financing cash flows from finance leases 1,224 Right-of-use assets obtained in exchange for lease obligations: Operating Leases 113,253 Finance Leases 7,636 Amortization: Amortization of Right of use operating lease assets (1) 85,061 (1) Amortization of Right of use operating lease assets during the period is reflected in Other assets and prepaid expenses on the Condensed Consolidated Statements of Cash Flows. |
Other expense (income), net (Ta
Other expense (income), net (Tables) | 9 Months Ended |
Sep. 28, 2019 | |
Other Nonoperating Income (Expense) [Abstract] | |
Summary of other expense (income), net | Other expense (income), net is as follows: Three Months Ended Nine Months Ended September 28, September 29, September 28, September 29, Foreign currency losses (gains), net $ (1,181 ) 2,456 (203 ) 7,178 Release of indemnification asset (659 ) — (659 ) 1,749 Impairment of net investment in a manufacturer and distributor of Ceramic tile in China (1) 65,172 — 65,172 — All other, net (10,619 ) (1,750 ) (18,381 ) (2,133 ) Total other expense, net $ 52,713 706 45,929 6,794 (1) During the quarter, the Company determined that its net investment in a manufacturer and distributor of ceramic tile in China was impaired and therefore recorded a net impairment charge of $65,172 . |
Stockholders' Equity (Tables)
Stockholders' Equity (Tables) | 9 Months Ended |
Sep. 28, 2019 | |
Equity [Abstract] | |
Schedule of changes in stockholders' equity | The following tables reflect the changes in stockholders’ equity for the three months ended September 28, 2019 and September 29, 2018 (in thousands). Total Stockholders’ Equity Redeemable Noncontrolling Interest Common Stock Additional Paid-in Capital Retained Earnings Accumulated Other Comprehensive Income (Loss) Treasury Stock Noncontrolling Interest Total Stockholders’ Equity Shares Amount Shares Amount June 29, 2019 $ — 79,712 $ 797 $ 1,859,248 $ 6,903,261 $ (732,521 ) (7,348 ) $ (215,712 ) $ 6,518 $ 7,821,591 Shares issued under employee and director stock plans — — — — — — — — — — Stock-based compensation expense — — — 5,651 — — — — — 5,651 Repurchases of common stock — (519 ) (5 ) — (67,703 ) — — — — (67,708 ) Accretion of redeemable noncontrolling interest — — — — — — — — — — Noncontrolling earnings — — — — — — — — 150 150 Currency translation adjustment on non-controlling interests — — — — — — — — (157 ) (157 ) Currency translation adjustment — — — — — (149,982 ) — — — (149,982 ) Prior pension and post-retirement benefit service cost and actuarial gain / loss — — — — — 216 — — — 216 Net income — — — — 155,518 — — — — 155,518 September 28, 2019 $ — 79,193 $ 792 $ 1,864,899 $ 6,991,076 $ (882,287 ) (7,348 ) $ (215,712 ) $ 6,511 $ 7,765,279 Total Stockholders’ Equity Redeemable Noncontrolling Interest Common Stock Additional Paid-in Capital Retained Earnings Accumulated Other Comprehensive Income (Loss) Treasury Stock Noncontrolling Interest Total Stockholders’ Equity Shares Amount Shares Amount June 30, 2018 $ 30,043 81,952 $ 820 $ 1,842,060 $ 6,409,552 $ (671,133 ) (7,350 ) $ (215,745 ) $ 7,880 $ 7,373,434 Shares issued under employee and director stock plans — — — — — — — — — — Stock-based compensation expense — — — 5,104 — — — — — 5,104 Repurchases of common stock — — — — — — — — — — Accretion of redeemable noncontrolling interest 670 — — — (669 ) — — — — (669 ) Noncontrolling earnings 817 — — — — — — — 195 195 Currency translation adjustment on non-controlling interests (303 ) — — — — — — — (54 ) (54 ) Currency translation adjustment — — — — — (33,314 ) — — — (33,314 ) Prior pension and post-retirement benefit service cost and actuarial gain / loss — — — — — 68 — — — 68 Net income — — — — 227,013 — — — — 227,013 September 29, 2018 $ 31,227 81,952 $ 820 $ 1,847,164 $ 6,635,896 $ (704,379 ) (7,350 ) $ (215,745 ) $ 8,021 $ 7,571,777 The following tables reflect the changes in stockholders’ equity for the nine months ended September 28, 2019 and September 29, 2018 (in thousands). Total Stockholders’ Equity Redeemable Noncontrolling Interest Common Stock Additional Paid-in Capital Retained Earnings Accumulated Other Comprehensive Income (Loss) Treasury Stock Noncontrolling Interest Total Stockholders’ Equity Shares Amount Shares Amount January 1, 2019 $ — 79,656 $ 797 $ 1,852,173 $ 6,588,197 $ (791,608 ) (7,349 ) $ (215,745 ) $ 6,245 $ 7,440,059 Shares issued under employee and director stock plans — 122 1 (4,502 ) — — 1 33 — (4,468 ) Stock-based compensation expense — — — 17,228 — — — — — 17,228 Repurchases of common stock — (585 ) (6 ) — (76,665 ) — — — — (76,671 ) Accretion of redeemable noncontrolling interest — — — — — — — — — — Noncontrolling earnings — — — — — — — — 354 354 Currency translation adjustment on non-controlling interests — — — — — — — — (88 ) (88 ) Currency translation adjustment — — — — — (90,962 ) — — — (90,962 ) Prior pension and post-retirement benefit service cost and actuarial gain / loss — — — — — 283 — — — 283 Net income — — — — 479,544 — — — — 479,544 September 28, 2019 $ — 79,193 $ 792 $ 1,864,899 $ 6,991,076 $ (882,287 ) (7,348 ) $ (215,712 ) $ 6,511 $ 7,765,279 Total Stockholders’ Equity Redeemable Noncontrolling Interest Common Stock Additional Paid-in Capital Retained Earnings Accumulated Other Comprehensive Income (Loss) Treasury Stock Noncontrolling Interest Total Stockholders’ Equity Shares Amount Shares Amount January 1, 2018 $ 29,463 81,771 $ 818 $ 1,828,131 $ 6,004,506 $ (558,527 ) (7,350 ) $ (215,766 ) $ 7,847 $ 7,067,009 Shares issued under employee and director stock plans — 181 2 (7,664 ) — — — 21 — (7,641 ) Stock-based compensation expense — — — 26,697 — — — — — 26,697 Repurchases of common stock — — — — — — — — — — Accretion of redeemable noncontrolling interest 975 — — — (975 ) — — — — (975 ) Noncontrolling earnings 2,043 — — — — — — — 404 404 Currency translation adjustment on non-controlling interests (1,254 ) — — — — — — — (230 ) (230 ) Currency translation adjustment — — — — (146,143 ) — — — (146,143 ) Prior pension and post-retirement benefit service cost and actuarial gain / loss — — — — — 291 — — — 291 Net income — — — — 632,365 — — — — 632,365 September 29, 2018 $ 31,227 81,952 $ 820 $ 1,847,164 $ 6,635,896 $ (704,379 ) (7,350 ) $ (215,745 ) $ 8,021 $ 7,571,777 |
Earnings per share (Tables)
Earnings per share (Tables) | 9 Months Ended |
Sep. 28, 2019 | |
Earnings Per Share [Abstract] | |
Schedule of earnings per share | A reconciliation of net earnings available to common stockholders and weighted-average common shares outstanding for purposes of calculating basic and diluted earnings per share is as follows: Three Months Ended Nine Months Ended September 28, September 29, September 28, September 29, Net earnings attributable to Mohawk Industries, Inc. $ 155,518 227,013 479,544 632,365 Accretion of redeemable noncontrolling interest (1) — (670 ) — (975 ) Net earnings available to common stockholders $ 155,518 226,343 479,544 631,390 Weighted-average common shares outstanding-basic and diluted: Weighted-average common shares outstanding—basic 72,106 74,603 72,302 74,599 Add weighted-average dilutive potential common shares—options to purchase common shares and RSUs, net 286 342 276 378 Weighted-average common shares outstanding-diluted 72,392 74,945 72,578 74,977 Earnings per share attributable to Mohawk Industries, Inc. Basic $ 2.16 3.03 6.63 8.46 Diluted $ 2.15 3.02 6.61 8.42 (1) Represents the accretion of the Company’s redeemable noncontrolling interest to redemptive value. The holder put this option to the Company on December 20, 2018 for $33,884 . |
Segment reporting (Tables)
Segment reporting (Tables) | 9 Months Ended |
Sep. 28, 2019 | |
Segment Reporting [Abstract] | |
Summary of segment information | Segment information is as follows: Three Months Ended Nine Months Ended September 28, September 29, September 28, September 29, Net sales: Global Ceramic segment $ 916,422 885,773 2,772,805 2,691,618 Flooring NA segment 1,001,908 1,047,540 2,907,327 3,055,468 Flooring ROW segment 600,855 612,487 1,866,028 1,787,930 Intersegment sales — — — — Total $ 2,519,185 2,545,800 7,546,160 7,535,016 Operating income (loss): Global Ceramic segment $ 84,410 118,716 286,886 366,893 Flooring NA segment 80,223 93,369 140,374 268,779 Flooring ROW segment 84,428 84,108 276,392 273,334 Corporate and intersegment eliminations (8,841 ) (8,949 ) (31,242 ) (27,056 ) Total $ 240,220 287,244 672,410 881,950 At September 28, 2019 At December 31, 2018 Assets: Global Ceramic segment $ 5,385,279 5,194,030 Flooring NA segment 4,020,205 3,938,639 Flooring ROW segment 3,736,296 3,666,617 Corporate and intersegment eliminations 250,982 299,837 Total $ 13,392,762 13,099,123 |
Debt (Tables)
Debt (Tables) | 9 Months Ended |
Sep. 28, 2019 | |
Debt Disclosure [Abstract] | |
Schedule of carrying values and estimated fair values of debt instruments | The fair values and carrying values of our debt instruments are detailed as follows: At September 28, 2019 At December 31, 2018 Fair Value Carrying Value Fair Value Carrying Value 3.85% senior notes, payable February 1, 2023; interest payable semiannually $ 626,491 600,000 599,904 600,000 2.00% senior notes, payable January 14, 2022; interest payable annually 569,037 547,046 587,487 572,148 Floating Rate Notes, payable May 18, 2020, interest payable quarterly 328,002 328,228 343,004 343,289 Floating Rate Notes, payable September 11, 2019, interest payable quarterly — — 343,560 343,289 Floating rate notes, payable September 04, 2021, interest payable quarterly 324,650 328,228 — — U.S. commercial paper 409,800 409,800 632,668 632,668 European commercial paper 522,976 522,976 707,175 707,175 Five-year senior secured credit facility, due March 26, 2022 2,500 2,500 57,896 57,896 Capital leases and other 21,469 21,469 6,664 6,664 Unamortized debt issuance costs (3,508 ) (3,508 ) (5,155 ) (5,155 ) Total debt 2,801,417 2,756,739 3,273,203 3,257,974 Less current portion of long-term debt and commercial paper 1,273,158 1,273,158 1,742,373 1,742,373 Long-term debt, less current portion $ 1,528,259 1,483,581 1,530,830 1,515,601 |
General (Details)
General (Details) $ in Thousands | 9 Months Ended | |||
Sep. 28, 2019USD ($) | Sep. 29, 2018USD ($) | Jan. 01, 2019USD ($) | Jun. 09, 2015EUR (€) | |
Debt Instrument [Line Items] | ||||
Right of use operating lease assets | $ 334,083 | |||
Operating lease liability | $ 341,242 | |||
2.00% Senior Notes due January 14, 2022 | ||||
Debt Instrument [Line Items] | ||||
Aggregate principal amount of debts | € | € 500,000,000 | |||
Interest rate percentage | 2.00% | 2.00% | ||
Change in debt value | $ 25,102 | $ 19,848 | ||
Change in debt value, net of taxes | $ 19,067 | $ 14,223 | ||
Accounting Standards Update 2016-02 | ||||
Debt Instrument [Line Items] | ||||
Right of use operating lease assets | $ 328,169 | |||
Operating lease liability | $ 332,286 |
Acquisitions - Narrative (Detai
Acquisitions - Narrative (Details) $ in Thousands | Jan. 31, 2019USD ($) | Nov. 16, 2018USD ($) | Jul. 02, 2018USD ($) | Apr. 04, 2017USD ($) | Mar. 31, 2018USD ($)business | Jul. 01, 2017USD ($)business | Apr. 01, 2017USD ($) | Sep. 28, 2019USD ($) | Dec. 31, 2018USD ($) |
Business Acquisition [Line Items] | |||||||||
Goodwill | $ 2,519,214 | $ 2,520,966 | |||||||
Peitsman | |||||||||
Business Acquisition [Line Items] | |||||||||
Purchase agreement price | $ 72,001 | ||||||||
Goodwill | $ 45,931 | ||||||||
Eliane | |||||||||
Business Acquisition [Line Items] | |||||||||
Purchase agreement price | $ 148,741 | ||||||||
Indebtedness acquired | 99,037 | ||||||||
Goodwill | 18,062 | ||||||||
Intangible assets subject to amortization | 5,818 | ||||||||
Godfrey Hirst Group | |||||||||
Business Acquisition [Line Items] | |||||||||
Purchase agreement price | $ 400,894 | ||||||||
Goodwill | 88,655 | ||||||||
Intangible assets subject to amortization | 43,635 | ||||||||
Emilceramica S.r.l | |||||||||
Business Acquisition [Line Items] | |||||||||
Purchase agreement price | $ 186,099 | ||||||||
Goodwill | 59,491 | ||||||||
Intangible assets subject to amortization | 2,348 | ||||||||
Tradenames | Eliane | |||||||||
Business Acquisition [Line Items] | |||||||||
Indefinite-lived tradename intangible asset | $ 32,238 | ||||||||
Tradenames | Godfrey Hirst Group | |||||||||
Business Acquisition [Line Items] | |||||||||
Indefinite-lived tradename intangible asset | $ 58,671 | ||||||||
Tradenames | Emilceramica S.r.l | |||||||||
Business Acquisition [Line Items] | |||||||||
Indefinite-lived tradename intangible asset | $ 16,196 | ||||||||
Flooring ROW segment | |||||||||
Business Acquisition [Line Items] | |||||||||
Purchase agreement price | $ 24,610 | ||||||||
Goodwill | 12,874 | 959,511 | 956,765 | ||||||
Intangible assets subject to amortization | $ 7 | ||||||||
Number of acquisitions | business | 3 | ||||||||
Flooring ROW segment | Flooring ROW Acquisition | |||||||||
Business Acquisition [Line Items] | |||||||||
Purchase agreement price | $ 1,407 | ||||||||
Intangible assets subject to amortization | $ 827 | ||||||||
Global Ceramic segment | |||||||||
Business Acquisition [Line Items] | |||||||||
Goodwill | 1,028,559 | 1,033,057 | |||||||
Global Ceramic segment | Global Ceramic Acquisitions | |||||||||
Business Acquisition [Line Items] | |||||||||
Purchase agreement price | $ 37,250 | ||||||||
Goodwill | $ 1,002 | ||||||||
Number of acquisitions | business | 2 | ||||||||
Flooring NA segment | |||||||||
Business Acquisition [Line Items] | |||||||||
Goodwill | $ 531,144 | $ 531,144 | |||||||
Flooring NA segment | Flooring NA Acquisition | |||||||||
Business Acquisition [Line Items] | |||||||||
Purchase agreement price | $ 26,623 |
Revenue from Contracts with C_3
Revenue from Contracts with Customers - Narrative (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |
Sep. 28, 2019 | Sep. 28, 2019 | Jan. 01, 2019 | |
Revenue from Contract with Customer [Abstract] | |||
Contract liability | $ 39,284 | $ 39,284 | $ 34,486 |
Revenue recognized related to contract liabilities | 0 | 0 | |
Capitalized contract cost | $ 54,900 | 54,900 | $ 57,840 |
Amortization of capitalized contract costs | $ 41,889 | ||
Capitalized contract costs, amortization period | 1 year |
Revenue from Contracts with C_4
Revenue from Contracts with Customers - Summary of Disaggregated Revenue (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 28, 2019 | Sep. 29, 2018 | Sep. 28, 2019 | Sep. 29, 2018 | |
Disaggregation of Revenue [Line Items] | ||||
Net sales | $ 2,519,185 | $ 2,545,800 | $ 7,546,160 | $ 7,535,016 |
Ceramic & Stone | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 929,992 | 902,552 | 2,814,733 | 2,744,118 |
Carpet & Resilient | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 1,010,131 | 1,043,971 | 2,946,402 | 2,920,292 |
Laminate & Wood | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 376,389 | 379,290 | 1,134,885 | 1,179,662 |
Other | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 202,673 | 219,987 | 650,140 | 690,944 |
United States | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 1,501,506 | 1,564,525 | 4,427,945 | 4,621,363 |
Europe | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 594,163 | 614,828 | 1,928,356 | 2,002,782 |
Russia | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 109,653 | 95,548 | 280,112 | 256,661 |
Other | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 313,863 | 270,899 | 909,747 | 654,210 |
Global Ceramic segment | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 916,422 | 885,773 | 2,772,805 | 2,691,618 |
Flooring NA segment | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 1,001,908 | 1,047,540 | 2,907,327 | 3,055,468 |
Flooring ROW segment | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 600,855 | 612,487 | 1,866,028 | 1,787,930 |
Operating segments | Global Ceramic segment | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 916,422 | 885,773 | 2,772,805 | 2,691,618 |
Operating segments | Global Ceramic segment | Ceramic & Stone | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 916,422 | 885,773 | 2,772,805 | 2,691,618 |
Operating segments | Global Ceramic segment | Carpet & Resilient | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 0 | 0 | 0 | 0 |
Operating segments | Global Ceramic segment | Laminate & Wood | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 0 | 0 | 0 | 0 |
Operating segments | Global Ceramic segment | Other | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 0 | 0 | 0 | 0 |
Operating segments | Global Ceramic segment | United States | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 537,247 | 565,616 | 1,633,583 | 1,700,338 |
Operating segments | Global Ceramic segment | Europe | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 168,032 | 175,026 | 552,546 | 573,932 |
Operating segments | Global Ceramic segment | Russia | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 77,024 | 68,113 | 196,731 | 183,244 |
Operating segments | Global Ceramic segment | Other | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 134,119 | 77,018 | 389,945 | 234,104 |
Operating segments | Flooring NA segment | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 1,001,908 | 1,047,540 | 2,907,327 | 3,055,468 |
Operating segments | Flooring NA segment | Ceramic & Stone | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 13,570 | 16,779 | 41,928 | 52,500 |
Operating segments | Flooring NA segment | Carpet & Resilient | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 816,190 | 851,970 | 2,360,014 | 2,466,695 |
Operating segments | Flooring NA segment | Laminate & Wood | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 172,148 | 178,791 | 505,385 | 536,273 |
Operating segments | Flooring NA segment | Other | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 0 | 0 | 0 | 0 |
Operating segments | Flooring NA segment | United States | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 963,784 | 998,488 | 2,793,110 | 2,920,604 |
Operating segments | Flooring NA segment | Europe | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 1,901 | 1,217 | 5,902 | 4,737 |
Operating segments | Flooring NA segment | Russia | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 15 | 0 | 66 | 0 |
Operating segments | Flooring NA segment | Other | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 36,208 | 47,835 | 108,249 | 130,127 |
Operating segments | Flooring ROW segment | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 600,855 | 612,487 | 1,866,028 | 1,787,930 |
Operating segments | Flooring ROW segment | Ceramic & Stone | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 0 | 0 | 0 | 0 |
Operating segments | Flooring ROW segment | Carpet & Resilient | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 193,941 | 192,001 | 586,388 | 453,597 |
Operating segments | Flooring ROW segment | Laminate & Wood | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 204,241 | 200,499 | 629,500 | 643,389 |
Operating segments | Flooring ROW segment | Other | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 202,673 | 219,987 | 650,140 | 690,944 |
Operating segments | Flooring ROW segment | United States | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 475 | 421 | 1,252 | 421 |
Operating segments | Flooring ROW segment | Europe | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 424,230 | 438,585 | 1,369,908 | 1,424,113 |
Operating segments | Flooring ROW segment | Russia | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 32,614 | 27,435 | 83,315 | 73,417 |
Operating segments | Flooring ROW segment | Other | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | $ 143,536 | $ 146,046 | $ 411,553 | $ 289,979 |
Restructuring, acquisition an_3
Restructuring, acquisition and integration-related costs - Restructuring and Related Costs by Type of Cost (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 28, 2019 | Sep. 29, 2018 | Sep. 28, 2019 | Sep. 29, 2018 | |
Restructuring Cost and Reserve [Line Items] | ||||
Restructuring costs | $ 45,533 | $ 42,791 | ||
Cost of sales | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Restructuring costs | $ 7,284 | $ 10,004 | 43,197 | 33,425 |
Acquisition integration-related costs | 180 | 198 | 2,736 | 3,293 |
Restructuring, acquisition transaction and integration-related costs | 7,464 | 10,202 | 45,933 | 36,718 |
Selling, general and administrative expenses | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Restructuring costs | 491 | 1,476 | 2,336 | 9,366 |
Acquisition transaction-related costs | 413 | 3,032 | 1,330 | 3,095 |
Acquisition integration-related costs | 1,147 | 5,180 | 4,554 | 8,857 |
Restructuring, acquisition transaction and integration-related costs | $ 2,051 | $ 9,688 | $ 8,220 | $ 21,318 |
Restructuring, acquisition an_4
Restructuring, acquisition and integration-related costs - Restructuring Reserve (Details) - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 28, 2019 | Sep. 29, 2018 | |
Restructuring Reserve [Roll Forward] | ||
Balance as of December 31, 2018 | $ 8,513 | |
Restructuring costs | 45,533 | $ 42,791 |
Cash payments | (24,778) | |
Non-cash items | (24,547) | |
Balance as of September 28, 2019 | 4,721 | |
Lease impairments | ||
Restructuring Reserve [Roll Forward] | ||
Balance as of December 31, 2018 | 397 | |
Cash payments | (361) | |
Non-cash items | 0 | |
Balance as of September 28, 2019 | 36 | |
Asset write-downs | ||
Restructuring Reserve [Roll Forward] | ||
Balance as of December 31, 2018 | 0 | |
Cash payments | 0 | |
Non-cash items | (24,306) | |
Balance as of September 28, 2019 | 0 | |
Severance | ||
Restructuring Reserve [Roll Forward] | ||
Balance as of December 31, 2018 | 7,866 | |
Cash payments | (11,715) | |
Non-cash items | (130) | |
Balance as of September 28, 2019 | 4,435 | |
Other restructuring costs | ||
Restructuring Reserve [Roll Forward] | ||
Balance as of December 31, 2018 | 250 | |
Cash payments | (12,702) | |
Non-cash items | (111) | |
Balance as of September 28, 2019 | 250 | |
Operating segments | Provision - Global Ceramic segment | ||
Restructuring Reserve [Roll Forward] | ||
Restructuring costs | 4,879 | |
Operating segments | Provision - Global Ceramic segment | Lease impairments | ||
Restructuring Reserve [Roll Forward] | ||
Restructuring costs | 0 | |
Operating segments | Provision - Global Ceramic segment | Asset write-downs | ||
Restructuring Reserve [Roll Forward] | ||
Restructuring costs | 0 | |
Operating segments | Provision - Global Ceramic segment | Severance | ||
Restructuring Reserve [Roll Forward] | ||
Restructuring costs | 4,879 | |
Operating segments | Provision - Global Ceramic segment | Other restructuring costs | ||
Restructuring Reserve [Roll Forward] | ||
Restructuring costs | 0 | |
Operating segments | Provision - Flooring NA segment | ||
Restructuring Reserve [Roll Forward] | ||
Restructuring costs | 35,046 | |
Operating segments | Provision - Flooring NA segment | Lease impairments | ||
Restructuring Reserve [Roll Forward] | ||
Restructuring costs | 0 | |
Operating segments | Provision - Flooring NA segment | Asset write-downs | ||
Restructuring Reserve [Roll Forward] | ||
Restructuring costs | 21,791 | |
Operating segments | Provision - Flooring NA segment | Severance | ||
Restructuring Reserve [Roll Forward] | ||
Restructuring costs | 1,168 | |
Operating segments | Provision - Flooring NA segment | Other restructuring costs | ||
Restructuring Reserve [Roll Forward] | ||
Restructuring costs | 12,087 | |
Operating segments | Provision - Flooring ROW segment | ||
Restructuring Reserve [Roll Forward] | ||
Restructuring costs | 5,608 | |
Operating segments | Provision - Flooring ROW segment | Lease impairments | ||
Restructuring Reserve [Roll Forward] | ||
Restructuring costs | 0 | |
Operating segments | Provision - Flooring ROW segment | Asset write-downs | ||
Restructuring Reserve [Roll Forward] | ||
Restructuring costs | 2,515 | |
Operating segments | Provision - Flooring ROW segment | Severance | ||
Restructuring Reserve [Roll Forward] | ||
Restructuring costs | 2,367 | |
Operating segments | Provision - Flooring ROW segment | Other restructuring costs | ||
Restructuring Reserve [Roll Forward] | ||
Restructuring costs | $ 726 |
Receivables, net (Details)
Receivables, net (Details) - USD ($) $ in Thousands | Sep. 28, 2019 | Dec. 31, 2018 |
Receivables [Abstract] | ||
Customers, trade | $ 1,763,435 | $ 1,562,284 |
Income tax receivable | 15,781 | 17,217 |
Other | 78,399 | 101,376 |
Receivables, gross | 1,857,615 | 1,680,877 |
Less: allowance for discounts, claims and doubtful accounts | 70,457 | 74,718 |
Receivables, net | $ 1,787,158 | $ 1,606,159 |
Inventories (Details)
Inventories (Details) - USD ($) $ in Thousands | Sep. 28, 2019 | Dec. 31, 2018 |
Inventory Disclosure [Abstract] | ||
Finished goods | $ 1,637,525 | $ 1,582,112 |
Work in process | 150,089 | 165,616 |
Raw materials | 550,338 | 539,887 |
Total inventories | $ 2,337,952 | $ 2,287,615 |
Goodwill and intangible asset_2
Goodwill and intangible assets - Schedule of goodwill (Details) - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 28, 2019 | Dec. 31, 2018 | |
Goodwill [Roll Forward] | ||
Goodwill, gross, beginning balance | $ 3,848,391 | |
Accumulated impairment losses | (1,327,425) | $ (1,327,425) |
Goodwill, net, beginning balance | 2,520,966 | |
Goodwill recognized during the period | 45,785 | |
Currency translation during the period | (47,537) | |
Goodwill, gross, ending balance | 3,846,639 | |
Accumulated impairment losses | (1,327,425) | (1,327,425) |
Goodwill, net, ending balance | 2,519,214 | |
Global Ceramic segment | ||
Goodwill [Roll Forward] | ||
Goodwill, gross, beginning balance | 1,564,987 | |
Accumulated impairment losses | (531,930) | (531,930) |
Goodwill, net, beginning balance | 1,033,057 | |
Goodwill recognized during the period | (1,758) | |
Currency translation during the period | (2,740) | |
Goodwill, gross, ending balance | 1,560,489 | |
Accumulated impairment losses | (531,930) | (531,930) |
Goodwill, net, ending balance | 1,028,559 | |
Flooring NA segment | ||
Goodwill [Roll Forward] | ||
Goodwill, gross, beginning balance | 874,198 | |
Accumulated impairment losses | (343,054) | (343,054) |
Goodwill, net, beginning balance | 531,144 | |
Goodwill recognized during the period | 0 | |
Currency translation during the period | 0 | |
Goodwill, gross, ending balance | 874,198 | |
Accumulated impairment losses | (343,054) | (343,054) |
Goodwill, net, ending balance | 531,144 | |
Flooring ROW segment | ||
Goodwill [Roll Forward] | ||
Goodwill, gross, beginning balance | 1,409,206 | |
Accumulated impairment losses | (452,441) | (452,441) |
Goodwill, net, beginning balance | 956,765 | |
Goodwill recognized during the period | 47,543 | |
Currency translation during the period | (44,797) | |
Goodwill, gross, ending balance | 1,411,952 | |
Accumulated impairment losses | (452,441) | $ (452,441) |
Goodwill, net, ending balance | $ 959,511 |
Goodwill and intangible asset_3
Goodwill and intangible assets - Schedule of indefinite life assets not subject to amortization (Details) - Tradenames $ in Thousands | 9 Months Ended |
Sep. 28, 2019USD ($) | |
Indefinite-lived Intangible Assets [Roll Forward] | |
Balance as of December 31, 2018 | $ 707,380 |
Intangible assets acquired during the period | (874) |
Currency translation during the period | (16,718) |
Balance as of September 28, 2019 | $ 689,788 |
Goodwill and intangible asset_4
Goodwill and intangible assets - Schedule of intangible assets subject to amortization (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Sep. 28, 2019 | Sep. 29, 2018 | Sep. 28, 2019 | Sep. 29, 2018 | Dec. 31, 2018 | |
Finite-lived Intangible Assets [Roll Forward] | |||||
Intangible assets subject to amortization, beginning balance | $ 912,030 | ||||
Intangible assets recognized during the period | 2,092 | ||||
Currency translation during the period | (31,529) | ||||
Intangible assets subject to amortization, ending balance | $ 882,593 | 882,593 | |||
Accumulated amortization, beginning balance | 657,601 | ||||
Amortization during the period | 6,912 | $ 8,148 | 20,596 | $ 23,198 | |
Currency translation during the period | (22,769) | ||||
Accumulated amortization, ending balance | 655,428 | 655,428 | |||
Intangible assets subject to amortization, net | 227,165 | 227,165 | $ 254,430 | ||
Customer relationships | |||||
Finite-lived Intangible Assets [Roll Forward] | |||||
Intangible assets subject to amortization, beginning balance | 651,012 | ||||
Intangible assets recognized during the period | 2,092 | ||||
Currency translation during the period | (20,143) | ||||
Intangible assets subject to amortization, ending balance | 632,961 | 632,961 | |||
Accumulated amortization, beginning balance | 406,386 | ||||
Amortization during the period | 19,027 | ||||
Currency translation during the period | (11,722) | ||||
Accumulated amortization, ending balance | 413,691 | 413,691 | |||
Intangible assets subject to amortization, net | 219,270 | 219,270 | |||
Patents | |||||
Finite-lived Intangible Assets [Roll Forward] | |||||
Intangible assets subject to amortization, beginning balance | 254,483 | ||||
Intangible assets recognized during the period | 0 | ||||
Currency translation during the period | (11,213) | ||||
Intangible assets subject to amortization, ending balance | 243,270 | 243,270 | |||
Accumulated amortization, beginning balance | 249,988 | ||||
Amortization during the period | 1,606 | ||||
Currency translation during the period | (11,028) | ||||
Accumulated amortization, ending balance | 240,566 | 240,566 | |||
Intangible assets subject to amortization, net | 2,704 | 2,704 | |||
Other | |||||
Finite-lived Intangible Assets [Roll Forward] | |||||
Intangible assets subject to amortization, beginning balance | 6,535 | ||||
Intangible assets recognized during the period | 0 | ||||
Currency translation during the period | (173) | ||||
Intangible assets subject to amortization, ending balance | 6,362 | 6,362 | |||
Accumulated amortization, beginning balance | 1,227 | ||||
Amortization during the period | (37) | ||||
Currency translation during the period | (19) | ||||
Accumulated amortization, ending balance | 1,171 | 1,171 | |||
Intangible assets subject to amortization, net | $ 5,191 | $ 5,191 |
Goodwill and intangible asset_5
Goodwill and intangible assets - Schedule of intangible assets amortization expense (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 28, 2019 | Sep. 29, 2018 | Sep. 28, 2019 | Sep. 29, 2018 | |
Goodwill and Intangible Assets Disclosure [Abstract] | ||||
Amortization expense | $ 6,912 | $ 8,148 | $ 20,596 | $ 23,198 |
Accounts payable and accrued _3
Accounts payable and accrued expenses (Details) - USD ($) $ in Thousands | Sep. 28, 2019 | Dec. 31, 2018 |
Payables and Accruals [Abstract] | ||
Outstanding checks in excess of cash | $ 4,064 | $ 14,624 |
Accounts payable, trade | 964,098 | 811,879 |
Accrued expenses | 490,094 | 430,431 |
Product warranties | 46,984 | 47,511 |
Accrued interest | 12,293 | 21,908 |
Accrued compensation and benefits | 221,326 | 197,513 |
Total accounts payable and accrued expenses | $ 1,738,859 | $ 1,523,866 |
Accumulated other comprehensi_3
Accumulated other comprehensive income (loss) (Details) $ in Thousands | 9 Months Ended |
Sep. 28, 2019USD ($) | |
Accumulated Other Comprehensive Income Rollforward [Roll Forward] | |
Beginning balance | $ 7,440,059 |
Current period other comprehensive income | (90,679) |
Ending balance | 7,765,279 |
Foreign currency translation adjustments | |
Accumulated Other Comprehensive Income Rollforward [Roll Forward] | |
Beginning balance | (782,102) |
Current period other comprehensive income | (90,962) |
Ending balance | (873,064) |
Pensions, net of tax | |
Accumulated Other Comprehensive Income Rollforward [Roll Forward] | |
Beginning balance | (9,506) |
Current period other comprehensive income | 283 |
Ending balance | (9,223) |
Accumulated Other Comprehensive Income (Loss) | |
Accumulated Other Comprehensive Income Rollforward [Roll Forward] | |
Beginning balance | (791,608) |
Ending balance | $ (882,287) |
Leases (Details)
Leases (Details) $ in Thousands | 9 Months Ended |
Sep. 28, 2019USD ($) | |
Lessee, Lease, Description [Line Items] | |
Leases not yet commenced | $ 2,709 |
Minimum | |
Lessee, Lease, Description [Line Items] | |
Term of contracts | 1 year |
Term of contracts, majority | 1 year |
Lease extensions | 3 years |
Maximum | |
Lessee, Lease, Description [Line Items] | |
Term of contracts | 60 years |
Term of contracts, majority | 8 years |
Lease extensions | 10 years |
Leases - Components of lease ex
Leases - Components of lease expense (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended |
Sep. 28, 2019 | Sep. 28, 2019 | |
Operating lease costs | ||
Fixed | $ 33,384 | $ 96,503 |
Short-term | 3,732 | 13,209 |
Variable | 8,528 | 27,447 |
Sub-leases | (227) | (636) |
Operating lease costs | 45,417 | 136,523 |
Finance lease costs | ||
Amortization of leased assets | 404 | 1,228 |
Interest on lease liabilities | 102 | 191 |
Finance lease costs | 506 | 1,419 |
Net lease costs | 45,923 | 137,942 |
Cost of sales | ||
Operating lease costs | ||
Fixed | 8,068 | 23,925 |
Short-term | 1,092 | 4,083 |
Variable | 1,475 | 5,846 |
Sub-leases | (114) | (239) |
Operating lease costs | 10,521 | 33,615 |
Finance lease costs | ||
Amortization of leased assets | 0 | 0 |
Interest on lease liabilities | 0 | 0 |
Finance lease costs | 0 | 0 |
Net lease costs | 10,521 | 33,615 |
Selling, general and administrative expenses | ||
Operating lease costs | ||
Fixed | 25,316 | 72,578 |
Short-term | 2,640 | 9,126 |
Variable | 7,053 | 21,601 |
Sub-leases | (113) | (397) |
Operating lease costs | 34,896 | 102,908 |
Finance lease costs | ||
Amortization of leased assets | 404 | 1,228 |
Interest on lease liabilities | 102 | 191 |
Finance lease costs | 506 | 1,419 |
Net lease costs | $ 35,402 | $ 104,327 |
Leases - Supplemental balance s
Leases - Supplemental balance sheet information (Details) $ in Thousands | Sep. 28, 2019USD ($) |
Operating Leases | |
Right of use operating lease assets | $ 334,083 |
Finance Leases | |
Property, plant and equipment, gross | 14,727 |
Accumulated depreciation | (2,809) |
Property, plant and equipment, net | 11,918 |
Total lease assets | 346,001 |
Operating Leases | |
Other current | 102,682 |
Non-current | 238,560 |
Total operating liabilities | 341,242 |
Finance Leases | |
Short-term debt | 1,351 |
Long-term debt | 11,319 |
Total finance liabilities | 12,670 |
Total lease liabilities | $ 353,912 |
Leases - Maturities of lease li
Leases - Maturities of lease liabilities (Details) $ in Thousands | Sep. 28, 2019USD ($) |
Finance Leases | |
2019 (excluding the nine months ended September 28, 2019) | $ 432 |
2020 | 1,647 |
2021 | 1,258 |
2022 | 1,022 |
2023 | 926 |
Thereafter | 8,987 |
Total lease payments | 14,272 |
Less imputed interest | 1,602 |
Present value, Total | 12,670 |
Operating Leases | |
2019 (excluding the nine months ended September 28, 2019) | 31,316 |
2020 | 116,032 |
2021 | 88,122 |
2022 | 59,951 |
2023 | 32,688 |
Thereafter | 42,182 |
Total lease payments | 370,291 |
Less imputed interest | 29,049 |
Present value, Total | 341,242 |
Total | |
2019 (excluding the nine months ended September 28, 2019) | 31,748 |
2020 | 117,679 |
2021 | 89,380 |
2022 | 60,973 |
2023 | 33,614 |
Thereafter | 51,169 |
Total lease payments | $ 384,563 |
Leases - Lease term and discoun
Leases - Lease term and discount rate (Details) | Sep. 28, 2019 |
Weighted Average Remaining Lease Term | |
Operating Leases | 4 years 4 months 13 days |
Finance Leases | 12 years 3 months 25 days |
Weighted Average Discount Rate | |
Operating Leases | 3.30% |
Finance Leases | 2.40% |
Leases - Supplemental cash flow
Leases - Supplemental cash flow information (Details) $ in Thousands | 9 Months Ended |
Sep. 28, 2019USD ($) | |
Cash paid for amounts included in measurement of lease liabilities: | |
Operating cash flows from operating leases | $ 96,752 |
Operating cash flows from finance leases | 123 |
Financing cash flows from finance leases | 1,224 |
Right-of-use assets obtained in exchange for lease obligations: | |
Operating Leases | 113,253 |
Finance Leases | 7,636 |
Amortization of right of use operating lease assets | $ 85,061 |
Stock-based compensation (Detai
Stock-based compensation (Details) - Restricted Stock Units (RSUs) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 28, 2019 | Sep. 29, 2018 | Sep. 28, 2019 | Sep. 29, 2018 | |
Share Based Compensation Arrangement by Share Based Payment Award [Line Items] | ||||
Number of shares granted in period (in shares) | 0 | 3 | 187 | 130 |
Weighted-average grant-date fair value (in usd per share) | $ 189.39 | $ 137.30 | $ 236.82 | |
Recognized stock-based compensation costs | $ 5,651 | $ 5,104 | $ 17,228 | $ 26,697 |
Recognized stock-based compensation costs, net of tax | 4,182 | $ 3,777 | 12,749 | $ 19,756 |
Pre-tax unrecognized compensation expense, net of forfeitures | $ 20,598 | $ 20,598 | ||
Recognized expense over a weighted-average period (years) | 1 year 5 months 15 days |
Other expense (income), net (De
Other expense (income), net (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 28, 2019 | Sep. 29, 2018 | Sep. 28, 2019 | Sep. 29, 2018 | |
Other Nonoperating Income (Expense) [Abstract] | ||||
Foreign currency losses (gains), net | $ (1,181) | $ 2,456 | $ (203) | $ 7,178 |
Release of indemnification asset | (659) | 0 | (659) | 1,749 |
Impairment of net investment in a manufacturer and distributor of Ceramic tile in China | 65,172 | 0 | 65,172 | 0 |
All other, net | (10,619) | (1,750) | (18,381) | (2,133) |
Total other expense, net | $ 52,713 | $ 706 | $ 45,929 | $ 6,794 |
Income Taxes (Details)
Income Taxes (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | 9 Months Ended | ||
Sep. 28, 2019 | Sep. 29, 2018 | Jun. 30, 2018 | Sep. 28, 2019 | Sep. 29, 2018 | |
Income Tax Disclosure [Abstract] | |||||
Income tax expense | $ 22,522 | $ 49,487 | $ 116,273 | $ 215,928 | |
Earnings before income taxes | $ 178,191 | $ 277,513 | $ 596,171 | $ 850,740 | |
Effective tax rate | 12.60% | 17.80% | 19.50% | 25.40% | |
Additional net tax expense | $ 54,674 |
Stockholders' Equity (Details)
Stockholders' Equity (Details) - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 28, 2019 | Sep. 29, 2018 | Sep. 28, 2019 | Sep. 29, 2018 | |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||
Beginning balance | $ 7,821,591 | $ 7,373,434 | $ 7,440,059 | $ 7,067,009 |
Shares issued under employee and director stock plans | 0 | 0 | (4,468) | (7,641) |
Stock-based compensation expense | 5,651 | 5,104 | 17,228 | 26,697 |
Repurchases of common stock | (67,708) | 0 | (76,671) | 0 |
Accretion of redeemable noncontrolling interest | 0 | (669) | 0 | (975) |
Noncontrolling earnings | 150 | 195 | 354 | 404 |
Currency translation adjustment on non-controlling interests | (157) | (54) | (88) | (230) |
Currency translation adjustment | (149,982) | (33,314) | (90,962) | (146,143) |
Prior pension and post-retirement benefit service cost and actuarial gain / loss | 216 | 68 | 283 | 291 |
Net income | 155,518 | 227,013 | 479,544 | 632,365 |
Ending balance | 7,765,279 | 7,571,777 | 7,765,279 | 7,571,777 |
Redeemable Noncontrolling Interest | ||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||
Beginning balance | 0 | 30,043 | 0 | 29,463 |
Accretion of redeemable noncontrolling interest | 670 | 975 | ||
Noncontrolling earnings | 817 | 2,043 | ||
Currency translation adjustment on non-controlling interests | (303) | (1,254) | ||
Ending balance | 0 | 31,227 | 0 | 31,227 |
Common Stock | ||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||
Beginning balance | $ 797 | $ 820 | $ 797 | $ 818 |
Beginning balance (in shares) | 79,712 | 81,952 | 79,656 | 81,771 |
Shares issued under employee and director stock plans | $ 1 | $ 2 | ||
Shares issued under employee and director stock plans (in shares) | 122 | 181 | ||
Repurchases of common stock | $ (5) | $ (6) | ||
Repurchases of common stock (in shares) | (519) | (585) | ||
Ending balance | $ 792 | $ 820 | $ 792 | $ 820 |
Ending balance (in shares) | 79,193 | 81,952 | 79,193 | 81,952 |
Additional Paid-in Capital | ||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||
Beginning balance | $ 1,859,248 | $ 1,842,060 | $ 1,852,173 | $ 1,828,131 |
Shares issued under employee and director stock plans | (4,502) | (7,664) | ||
Stock-based compensation expense | 5,651 | 5,104 | 17,228 | 26,697 |
Ending balance | 1,864,899 | 1,847,164 | 1,864,899 | 1,847,164 |
Retained Earnings | ||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||
Beginning balance | 6,903,261 | 6,409,552 | 6,588,197 | 6,004,506 |
Repurchases of common stock | (67,703) | (76,665) | ||
Accretion of redeemable noncontrolling interest | (669) | (975) | ||
Net income | 155,518 | 227,013 | 479,544 | 632,365 |
Ending balance | 6,991,076 | 6,635,896 | 6,991,076 | 6,635,896 |
Accumulated Other Comprehensive Income (Loss) | ||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||
Beginning balance | (732,521) | (671,133) | (791,608) | (558,527) |
Currency translation adjustment | (149,982) | (33,314) | (90,962) | (146,143) |
Prior pension and post-retirement benefit service cost and actuarial gain / loss | 216 | 68 | 283 | 291 |
Ending balance | (882,287) | (704,379) | (882,287) | (704,379) |
Treasury Stock | ||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||
Beginning balance | $ (215,712) | $ (215,745) | $ (215,745) | $ (215,766) |
Beginning balance (in shares) | (7,348) | (7,350) | (7,349) | (7,350) |
Shares issued under employee and director stock plans | $ 33 | $ 21 | ||
Shares issued under employee and director stock plans (in shares) | 1 | |||
Ending balance | $ (215,712) | $ (215,745) | $ (215,712) | $ (215,745) |
Ending balance (in shares) | (7,348) | (7,350) | (7,348) | (7,350) |
Noncontrolling Interest | ||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||
Beginning balance | $ 6,518 | $ 7,880 | $ 6,245 | $ 7,847 |
Noncontrolling earnings | 150 | 195 | 354 | 404 |
Currency translation adjustment on non-controlling interests | (157) | (54) | (88) | (230) |
Ending balance | $ 6,511 | $ 8,021 | $ 6,511 | $ 8,021 |
Earnings per share (Details)
Earnings per share (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | Dec. 20, 2018 | Sep. 28, 2019 | Sep. 29, 2018 | Sep. 28, 2019 | Sep. 29, 2018 |
Earnings Per Share [Abstract] | |||||
Net earnings attributable to Mohawk Industries, Inc. | $ 155,518 | $ 227,013 | $ 479,544 | $ 632,365 | |
Accretion of redeemable noncontrolling interest | 0 | (670) | 0 | (975) | |
Net earnings available to common stockholders | $ 155,518 | $ 226,343 | $ 479,544 | $ 631,390 | |
Weighted-average common shares outstanding-basic and diluted: | |||||
Weighted-average common shares outstanding-basic (in shares) | 72,106 | 74,603 | 72,302 | 74,599 | |
Add weighted-average dilutive potential common shares-options to purchase common shares and RSUs, net (in shares) | 286 | 342 | 276 | 378 | |
Weighted-average common shares outstanding-diluted (in shares) | 72,392 | 74,945 | 72,578 | 74,977 | |
Earnings per share attributable to Mohawk Industries, Inc. | |||||
Basic (in usd per share) | $ 2.16 | $ 3.03 | $ 6.63 | $ 8.46 | |
Diluted (in usd per share) | $ 2.15 | $ 3.02 | $ 6.61 | $ 8.42 | |
Put of option by holder | $ 33,884 |
Segment reporting (Details)
Segment reporting (Details) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Sep. 28, 2019USD ($) | Sep. 29, 2018USD ($) | Sep. 28, 2019USD ($)segment | Sep. 29, 2018USD ($) | Dec. 31, 2018USD ($) | |
Segment Reporting [Abstract] | |||||
Number of reportable segments | segment | 3 | ||||
Segment Reporting Information [Line Items] | |||||
Net sales | $ 2,519,185 | $ 2,545,800 | $ 7,546,160 | $ 7,535,016 | |
Operating income (loss) | 240,220 | 287,244 | 672,410 | 881,950 | |
Assets | 13,392,762 | 13,392,762 | $ 13,099,123 | ||
Global Ceramic segment | |||||
Segment Reporting Information [Line Items] | |||||
Net sales | 916,422 | 885,773 | 2,772,805 | 2,691,618 | |
Flooring NA segment | |||||
Segment Reporting Information [Line Items] | |||||
Net sales | 1,001,908 | 1,047,540 | 2,907,327 | 3,055,468 | |
Flooring ROW segment | |||||
Segment Reporting Information [Line Items] | |||||
Net sales | 600,855 | 612,487 | 1,866,028 | 1,787,930 | |
Operating segments | Global Ceramic segment | |||||
Segment Reporting Information [Line Items] | |||||
Net sales | 916,422 | 885,773 | 2,772,805 | 2,691,618 | |
Operating income (loss) | 84,410 | 118,716 | 286,886 | 366,893 | |
Assets | 5,385,279 | 5,385,279 | 5,194,030 | ||
Operating segments | Flooring NA segment | |||||
Segment Reporting Information [Line Items] | |||||
Net sales | 1,001,908 | 1,047,540 | 2,907,327 | 3,055,468 | |
Operating income (loss) | 80,223 | 93,369 | 140,374 | 268,779 | |
Assets | 4,020,205 | 4,020,205 | 3,938,639 | ||
Operating segments | Flooring ROW segment | |||||
Segment Reporting Information [Line Items] | |||||
Net sales | 600,855 | 612,487 | 1,866,028 | 1,787,930 | |
Operating income (loss) | 84,428 | 84,108 | 276,392 | 273,334 | |
Assets | 3,736,296 | 3,736,296 | 3,666,617 | ||
Intersegment sales | |||||
Segment Reporting Information [Line Items] | |||||
Net sales | 0 | 0 | 0 | 0 | |
Corporate and intersegment eliminations | |||||
Segment Reporting Information [Line Items] | |||||
Operating income (loss) | (8,841) | $ (8,949) | (31,242) | $ (27,056) | |
Assets | $ 250,982 | $ 250,982 | $ 299,837 |
Commitments and contingencies (
Commitments and contingencies (Details) - Belgium - Foreign tax authority - EUR (€) € in Thousands | 1 Months Ended | 36 Months Ended |
Mar. 30, 2019 | Dec. 31, 2014 | |
2005 | ||
Commitments And Contingencies [Line Items] | ||
Assessment received from Belgian tax authority (in euros) | € 46,135 | |
2006 | ||
Commitments And Contingencies [Line Items] | ||
Assessment received from Belgian tax authority (in euros) | 38,817 | |
2007 | ||
Commitments And Contingencies [Line Items] | ||
Assessment received from Belgian tax authority (in euros) | 39,635 | |
2008 | ||
Commitments And Contingencies [Line Items] | ||
Assessment received from Belgian tax authority (in euros) | 30,131 | |
2009 | ||
Commitments And Contingencies [Line Items] | ||
Assessment received from Belgian tax authority (in euros) | 35,567 | |
2010 | ||
Commitments And Contingencies [Line Items] | ||
Assessment received from Belgian tax authority (in euros) | € 43,117 | |
2011 | ||
Commitments And Contingencies [Line Items] | ||
Assessment received from Belgian tax authority (in euros) | € 40,617 | |
2012 | ||
Commitments And Contingencies [Line Items] | ||
Assessment received from Belgian tax authority (in euros) | 39,732 | |
2013 | ||
Commitments And Contingencies [Line Items] | ||
Assessment received from Belgian tax authority (in euros) | 11,358 | |
2014 | ||
Commitments And Contingencies [Line Items] | ||
Assessment received from Belgian tax authority (in euros) | 23,919 | |
2015 | ||
Commitments And Contingencies [Line Items] | ||
Assessment received from Belgian tax authority (in euros) | 30,610 | |
2016 | ||
Commitments And Contingencies [Line Items] | ||
Assessment received from Belgian tax authority (in euros) | 93,145 | |
2017 | ||
Commitments And Contingencies [Line Items] | ||
Assessment received from Belgian tax authority (in euros) | € 79,933 |
Debt - Senior Credit Facility a
Debt - Senior Credit Facility and Term Loan (Details) | Oct. 18, 2019renewal_option | Mar. 26, 2015USD ($) | Sep. 28, 2019USD ($) | Dec. 31, 2017USD ($) | Mar. 25, 2015USD ($) |
2013 Senior Secured Credit Facility | |||||
Line of Credit Facility [Line Items] | |||||
Maximum borrowing capacity under credit facility | $ 1,000,000,000 | ||||
2015 Senior Secured Credit Facility | |||||
Line of Credit Facility [Line Items] | |||||
Maximum borrowing capacity under credit facility | $ 1,800,000,000 | ||||
Commitment fee percentage | 0.125% | ||||
Consolidated interest coverage ratio, at least | 3 | ||||
Consolidated net leverage ratio, no more than | 3.75 | ||||
Unamortized financing costs | $ 6,873,000 | ||||
Utilized borrowings under credit facility | $ 958,063,000 | ||||
Available amount under credit facility | 841,937,000 | ||||
2015 Senior Secured Credit Facility | Borrowings | |||||
Line of Credit Facility [Line Items] | |||||
Utilized borrowings under credit facility | 2,500,000 | ||||
2015 Senior Secured Credit Facility | Standby letters of credit | |||||
Line of Credit Facility [Line Items] | |||||
Utilized borrowings under credit facility | $ 22,787,000 | ||||
2015 Senior Secured Credit Facility | Minimum | |||||
Line of Credit Facility [Line Items] | |||||
Commitment fee percentage | 0.10% | ||||
2015 Senior Secured Credit Facility | Maximum | |||||
Line of Credit Facility [Line Items] | |||||
Commitment fee percentage | 0.225% | ||||
2015 Senior Secured Credit Facility | London Interbank Offered Rate (LIBOR) | |||||
Line of Credit Facility [Line Items] | |||||
Basis spread on debt instrument | 1.125% | ||||
2015 Senior Secured Credit Facility | London Interbank Offered Rate (LIBOR) | Minimum | |||||
Line of Credit Facility [Line Items] | |||||
Basis spread on debt instrument | 1.00% | ||||
2015 Senior Secured Credit Facility | London Interbank Offered Rate (LIBOR) | Maximum | |||||
Line of Credit Facility [Line Items] | |||||
Basis spread on debt instrument | 1.75% | ||||
2015 Senior Secured Credit Facility | Federal funds | |||||
Line of Credit Facility [Line Items] | |||||
Basis spread on debt instrument | 0.50% | ||||
2015 Senior Secured Credit Facility | Monthly LIBOR | |||||
Line of Credit Facility [Line Items] | |||||
Basis spread on debt instrument | 1.00% | 0.125% | |||
2015 Senior Secured Credit Facility | Monthly LIBOR | Minimum | |||||
Line of Credit Facility [Line Items] | |||||
Basis spread on debt instrument | 0.00% | ||||
2015 Senior Secured Credit Facility | Monthly LIBOR | Maximum | |||||
Line of Credit Facility [Line Items] | |||||
Basis spread on debt instrument | 0.75% | ||||
2015 Senior Secured Credit Facility Amendment, Maturing March 26, 2022 | |||||
Line of Credit Facility [Line Items] | |||||
Unamortized financing costs | $ 567,000 | ||||
Commercial Paper | |||||
Line of Credit Facility [Line Items] | |||||
Utilized borrowings under credit facility | $ 932,776,000 | ||||
Subsequent Event | 2019 Senior Secured Credit Facility | |||||
Line of Credit Facility [Line Items] | |||||
Number of options to extend maturity (up to) | renewal_option | 2 | ||||
Additional maturity period extended | 1 year |
Debt - Commercial Paper (Detail
Debt - Commercial Paper (Details) - USD ($) | Jul. 31, 2015 | Feb. 28, 2014 | Sep. 28, 2019 | Dec. 31, 2018 | Mar. 26, 2015 |
Commercial Paper | United States | |||||
Line of Credit Facility [Line Items] | |||||
Maturity period of debt | 397 days | 25 days 1 hour 40 minutes 48 seconds | |||
Maximum borrowing capacity under credit facility | $ 1,800,000,000 | ||||
Weighted average interest rate on debt | 2.32% | ||||
Commercial Paper | Europe | |||||
Line of Credit Facility [Line Items] | |||||
Maturity period of debt | 183 days | 30 days 16 hours 8 minutes 48 seconds | |||
Weighted average interest rate on debt | (0.22%) | ||||
Carrying value | United States | |||||
Line of Credit Facility [Line Items] | |||||
Commercial paper | $ 409,800,000 | $ 632,668,000 | |||
Carrying value | Europe | |||||
Line of Credit Facility [Line Items] | |||||
Commercial paper | $ 522,976,000 | $ 707,175,000 |
Debt - Senior Notes (Details)
Debt - Senior Notes (Details) | Sep. 04, 2019USD ($) | May 18, 2018USD ($) | Sep. 11, 2017USD ($) | Jun. 09, 2015USD ($) | Jan. 31, 2013USD ($) | Sep. 28, 2019USD ($) | Sep. 29, 2018USD ($) | Sep. 04, 2019EUR (€) | May 18, 2018EUR (€) | Sep. 11, 2017EUR (€) | Jun. 09, 2015EUR (€) |
Debt Instrument [Line Items] | |||||||||||
Payment of financing costs | $ 757,000 | $ 864,000 | |||||||||
Floating rate notes due September 04, 2021 | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Aggregate principal amount of debts | € | € 300,000,000 | ||||||||||
Issuance premium received | € | € 744,000 | ||||||||||
Payment of financing costs | $ 754,000 | ||||||||||
Floating Rate Notes due May 18, 2020 | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Aggregate principal amount of debts | € | € 300,000,000 | ||||||||||
Payment of financing costs | $ 890,000 | ||||||||||
Floating Rate Notes due September 11, 2019 | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Aggregate principal amount of debts | € | € 300,000,000 | ||||||||||
Payment of financing costs | $ 911,000 | ||||||||||
2.00% Senior Notes due January 14, 2022 | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Aggregate principal amount of debts | € | € 500,000,000 | ||||||||||
Payment of financing costs | $ 4,218,000 | ||||||||||
Interest rate percentage | 2.00% | 2.00% | |||||||||
3.85% Senior Notes due February 1, 2023 | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Aggregate principal amount of debts | $ 600,000,000 | ||||||||||
Payment of financing costs | $ 6,000,000 | ||||||||||
Interest rate percentage | 3.85% | 3.85% | |||||||||
Euro Interbank Offered Rate (EURIBOR) | Floating rate notes due September 04, 2021 | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Basis spread on debt instrument | 0.20% | ||||||||||
Euro Interbank Offered Rate (EURIBOR) | Floating Rate Notes due May 18, 2020 | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Basis spread on debt instrument | 0.30% | ||||||||||
Euro Interbank Offered Rate (EURIBOR) | Floating Rate Notes due September 11, 2019 | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Basis spread on debt instrument | 0.30% |
Debt - Fair Value and Carrying
Debt - Fair Value and Carrying Value of Debt Instruments (Details) - USD ($) $ in Thousands | Sep. 28, 2019 | Dec. 31, 2018 | Jun. 09, 2015 | Jan. 31, 2013 |
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||||
Less current portion of long-term debt and commercial paper | $ 1,273,158 | $ 1,742,373 | ||
3.85% Senior Notes due February 1, 2023 | ||||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||||
Interest rate percentage | 3.85% | 3.85% | ||
2.00% Senior Notes due January 14, 2022 | ||||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||||
Interest rate percentage | 2.00% | 2.00% | ||
Fair Value | ||||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||||
Capital leases and other | $ 21,469 | 6,664 | ||
Unamortized debt issuance costs | (3,508) | (5,155) | ||
Total debt | 2,801,417 | 3,273,203 | ||
Less current portion of long-term debt and commercial paper | 1,273,158 | 1,742,373 | ||
Long-term debt, less current portion | 1,528,259 | 1,530,830 | ||
Fair Value | 3.85% Senior Notes due February 1, 2023 | ||||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||||
Notes payable | 626,491 | 599,904 | ||
Fair Value | 2.00% Senior Notes due January 14, 2022 | ||||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||||
Notes payable | 569,037 | 587,487 | ||
Fair Value | Floating Rate Notes due May 18, 2020 | ||||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||||
Notes payable | 328,002 | 343,004 | ||
Fair Value | Floating Rate Notes due September 11, 2019 | ||||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||||
Notes payable | 0 | 343,560 | ||
Fair Value | Floating rate notes due September 04, 2021 | ||||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||||
Notes payable | 324,650 | 0 | ||
Fair Value | Five-year senior secured credit facility, due March 26, 2022 | ||||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||||
Notes payable | 2,500 | 57,896 | ||
Carrying Value | ||||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||||
Capital leases and other | 21,469 | 6,664 | ||
Unamortized debt issuance costs | (3,508) | (5,155) | ||
Total debt | 2,756,739 | 3,257,974 | ||
Less current portion of long-term debt and commercial paper | 1,273,158 | 1,742,373 | ||
Long-term debt, less current portion | 1,483,581 | 1,515,601 | ||
Carrying Value | 3.85% Senior Notes due February 1, 2023 | ||||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||||
Notes payable | 600,000 | 600,000 | ||
Carrying Value | 2.00% Senior Notes due January 14, 2022 | ||||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||||
Notes payable | 547,046 | 572,148 | ||
Carrying Value | Floating Rate Notes due May 18, 2020 | ||||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||||
Notes payable | 328,228 | 343,289 | ||
Carrying Value | Floating Rate Notes due September 11, 2019 | ||||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||||
Notes payable | 0 | 343,289 | ||
Carrying Value | Floating rate notes due September 04, 2021 | ||||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||||
Notes payable | 328,228 | 0 | ||
Carrying Value | Five-year senior secured credit facility, due March 26, 2022 | ||||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||||
Notes payable | 2,500 | 57,896 | ||
United States | Fair Value | ||||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||||
Commercial paper | 409,800 | 632,668 | ||
United States | Carrying Value | ||||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||||
Commercial paper | 409,800 | 632,668 | ||
Europe | Fair Value | ||||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||||
Commercial paper | 522,976 | 707,175 | ||
Europe | Carrying Value | ||||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||||
Commercial paper | $ 522,976 | $ 707,175 |
Subsequent Event (Details)
Subsequent Event (Details) - 2019 Senior Secured Credit Facility - Subsequent Event | Oct. 18, 2019renewal_option |
Subsequent Event [Line Items] | |
Number of options to extend maturity (up to) | 2 |
Additional maturity period extended | 1 year |