Document and Entity Information
Document and Entity Information - shares | 6 Months Ended | |
Jul. 01, 2023 | Jul. 24, 2023 | |
Document and Entity Information | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Transition Report | false | |
Document Period End Date | Jul. 01, 2023 | |
Entity File Number | 1-3390 | |
Entity Registrant Name | Seaboard Corporation | |
Entity Incorporation, State or Country Code | DE | |
Entity Tax Identification Number | 04-2260388 | |
Entity Address, Address Line One | 9000 West 67th Street | |
Entity Address, City or Town | Merriam | |
Entity Address, State or Province | KS | |
Entity Address, Postal Zip Code | 66202 | |
City Area Code | 913 | |
Local Phone Number | 676-8928 | |
Title of 12(b) Security | Common Stock $1.00 Par Value | |
Trading Symbol | SEB | |
Security Exchange Name | NYSEAMER | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Large Accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 1,160,779 | |
Entity Central Index Key | 0000088121 | |
Current Fiscal Year End Date | --12-31 | |
Document Fiscal Year Focus | 2023 | |
Document Fiscal Period Focus | Q2 | |
Amendment Flag | false |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Comprehensive Income - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jul. 01, 2023 | Jul. 02, 2022 | Jul. 01, 2023 | Jul. 02, 2022 | |
Net sales: | ||||
Total net sales | $ 2,393 | $ 2,973 | $ 4,892 | $ 5,682 |
Cost of sales and operating expenses: | ||||
Total cost of sales and operating expenses | 2,297 | 2,692 | 4,762 | 5,165 |
Gross income | 96 | 281 | 130 | 517 |
Selling, general and administrative expenses | 100 | 89 | 197 | 179 |
Operating income (loss) | (4) | 192 | (67) | 338 |
Other income (expense): | ||||
Interest expense | (20) | (12) | (32) | (10) |
Interest income | 14 | 7 | 27 | 12 |
Income from affiliates | 25 | 23 | 51 | 46 |
Other investment income (loss), net | 23 | (162) | 50 | (227) |
Foreign currency gains, net | 7 | 12 | 3 | 12 |
Miscellaneous, net | 3 | 2 | 3 | 10 |
Total other income (expense), net | 52 | (130) | 102 | (157) |
Earnings before income taxes | 48 | 62 | 35 | 181 |
Income tax benefit | 4 | 46 | 1 | 31 |
Net earnings | 52 | 108 | 36 | 212 |
Less: Net earnings attributable to noncontrolling interests | 0 | 0 | 0 | (1) |
Net earnings attributable to Seaboard | $ 52 | $ 108 | $ 36 | $ 211 |
Earnings per common share (in dollars per share) | $ 44.80 | $ 92.53 | $ 31.01 | $ 181.81 |
Average number of shares outstanding (in shares) | 1,160,779 | 1,160,779 | 1,160,779 | 1,160,779 |
Other comprehensive income (loss), net of income tax expense of $0, $0, $0 and $0: | ||||
Foreign currency translation adjustment | $ 1 | $ (2) | $ 13 | $ (3) |
Unrecognized pension cost | 2 | 1 | 4 | 1 |
Other comprehensive income (loss), net of tax | 3 | (1) | 17 | (2) |
Comprehensive income | 55 | 107 | 53 | 210 |
Less: Comprehensive income attributable to noncontrolling interests | 0 | 0 | 0 | (1) |
Comprehensive income attributable to Seaboard | 55 | 107 | 53 | 209 |
Products | ||||
Net sales: | ||||
Total net sales | 1,957 | 2,388 | 3,941 | 4,602 |
Cost of sales and operating expenses: | ||||
Total cost of sales and operating expenses | 1,982 | 2,302 | 4,076 | 4,423 |
Services | ||||
Net sales: | ||||
Total net sales | 373 | 538 | 836 | 1,015 |
Cost of sales and operating expenses: | ||||
Total cost of sales and operating expenses | 275 | 350 | 606 | 681 |
Other | ||||
Net sales: | ||||
Total net sales | 63 | 47 | 115 | 65 |
Cost of sales and operating expenses: | ||||
Total cost of sales and operating expenses | $ 40 | $ 40 | $ 80 | $ 61 |
Condensed Consolidated Statem_2
Condensed Consolidated Statements of Comprehensive Income (Parenthetical) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jul. 01, 2023 | Jul. 02, 2022 | Jul. 01, 2023 | Jul. 02, 2022 | |
Other comprehensive income (loss), income tax expense | $ 0 | $ 0 | $ 0 | $ 0 |
Products | Affiliates | ||||
Net sales | 290 | 411 | 548 | 800 |
Services | Affiliates | ||||
Net sales | $ 6 | $ 5 | $ 12 | $ 10 |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Millions | Jul. 01, 2023 | Dec. 31, 2022 |
Current assets: | ||
Cash and cash equivalents | $ 68 | $ 199 |
Short-term investments | 1,225 | 1,086 |
Receivables: | ||
Trade | 553 | 588 |
Other | 142 | 171 |
Total receivables | 843 | 954 |
Allowance for credit losses | (27) | (31) |
Receivables, net | 816 | 923 |
Inventories | 1,610 | 1,670 |
Other current assets | 147 | 139 |
Total current assets | 3,866 | 4,017 |
Property, plant and equipment, net of accumulated depreciation of $1,850 and $1,744 | 2,287 | 2,246 |
Operating lease right of use assets, net | 402 | 445 |
Investments in and advances to affiliates | 734 | 753 |
Goodwill | 162 | 154 |
Other non-current assets | 354 | 287 |
Total assets | 7,805 | 7,902 |
Current liabilities: | ||
Lines of credit | 444 | 457 |
Accounts payable | 348 | 429 |
Deferred revenue (includes $30 and $12 from affiliates) | 79 | 70 |
Operating lease liabilities | 148 | 156 |
Other current liabilities | 439 | 417 |
Total current liabilities | 1,458 | 1,529 |
Long-term debt, less current maturities | 698 | 702 |
Long-term operating lease liabilities | 281 | 318 |
Other non-current liabilities | 306 | 339 |
Total liabilities | 2,743 | 2,888 |
Commitments and contingent liabilities | ||
Stockholders' equity: | ||
Common stock of $1 par value. Authorized 1,250,000 shares; issued and outstanding 1,160,779 shares in 2023 and 2022 | 1 | 1 |
Accumulated other comprehensive loss | (405) | (422) |
Retained earnings | 5,448 | 5,417 |
Total Seaboard stockholders' equity | 5,044 | 4,996 |
Noncontrolling interests | 18 | 18 |
Total equity | 5,062 | 5,014 |
Total liabilities and equity | 7,805 | 7,902 |
Affiliates | ||
Receivables: | ||
Due from affiliates | $ 148 | $ 195 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Millions | Jul. 01, 2023 | Dec. 31, 2022 |
Consolidated Balance Sheets | ||
Property, plant and equipment - accumulated depreciation | $ 1,850 | $ 1,744 |
Deferred revenue from affiliates | $ 30 | $ 12 |
Common stock, par value (in dollars per share) | $ 1 | $ 1 |
Common stock, authorized shares | 1,250,000 | 1,250,000 |
Common stock, issued shares | 1,160,779 | 1,160,779 |
Common stock, outstanding shares | 1,160,779 | 1,160,779 |
Consolidated Statements of Chan
Consolidated Statements of Changes in Equity - USD ($) $ in Millions | Common Stock | Accumulated Other Comprehensive Loss | Retained Earnings | Noncontrolling Interest | Total |
Balances at Dec. 31, 2021 | $ 1 | $ (432) | $ 4,847 | $ 18 | $ 4,434 |
Comprehensive income: | |||||
Net earnings (loss) | 103 | 1 | 104 | ||
Other comprehensive income (loss), net of tax | (1) | (1) | |||
Dividends on common stock ($2.25/share) | (3) | (3) | |||
Balances at Apr. 02, 2022 | 1 | (433) | 4,947 | 19 | 4,534 |
Balances at Dec. 31, 2021 | 1 | (432) | 4,847 | 18 | 4,434 |
Comprehensive income: | |||||
Net earnings (loss) | 212 | ||||
Other comprehensive income (loss), net of tax | (2) | ||||
Balances at Jul. 02, 2022 | 1 | (434) | 5,053 | 19 | 4,639 |
Balances at Apr. 02, 2022 | 1 | (433) | 4,947 | 19 | 4,534 |
Comprehensive income: | |||||
Net earnings (loss) | 108 | 108 | |||
Other comprehensive income (loss), net of tax | (1) | (1) | |||
Dividends on common stock ($2.25/share) | (2) | (2) | |||
Balances at Jul. 02, 2022 | 1 | (434) | 5,053 | 19 | 4,639 |
Balances at Dec. 31, 2022 | 1 | (422) | 5,417 | 18 | 5,014 |
Comprehensive income: | |||||
Net earnings (loss) | (16) | (16) | |||
Other comprehensive income (loss), net of tax | 14 | 14 | |||
Dividends on common stock ($2.25/share) | (3) | (3) | |||
Balances at Apr. 01, 2023 | 1 | (408) | 5,398 | 18 | 5,009 |
Balances at Dec. 31, 2022 | 1 | (422) | 5,417 | 18 | 5,014 |
Comprehensive income: | |||||
Net earnings (loss) | 36 | ||||
Other comprehensive income (loss), net of tax | 17 | ||||
Balances at Jul. 01, 2023 | 1 | (405) | 5,448 | 18 | 5,062 |
Balances at Apr. 01, 2023 | 1 | (408) | 5,398 | 18 | 5,009 |
Comprehensive income: | |||||
Net earnings (loss) | 52 | 52 | |||
Other comprehensive income (loss), net of tax | 3 | 3 | |||
Dividends on common stock ($2.25/share) | (2) | (2) | |||
Balances at Jul. 01, 2023 | $ 1 | $ (405) | $ 5,448 | $ 18 | $ 5,062 |
Consolidated Statements of Ch_2
Consolidated Statements of Changes in Equity (Parenthetical) - $ / shares | 3 Months Ended | |||
Jul. 01, 2023 | Apr. 01, 2023 | Jul. 02, 2022 | Apr. 02, 2022 | |
Consolidated Statements of Changes in Equity | ||||
Dividends on common stock (in dollars per share) | $ 2.25 | $ 2.25 | $ 2.25 | $ 2.25 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) $ in Millions | 6 Months Ended | |
Jul. 01, 2023 | Jul. 02, 2022 | |
Cash flows from operating activities: | ||
Net earnings | $ 36 | $ 212 |
Adjustments to reconcile net earnings to cash from operating activities: | ||
Depreciation and amortization | 142 | 102 |
Deferred income taxes | (60) | (80) |
Income from affiliates | (51) | (46) |
Dividends received from affiliates | 65 | 16 |
Other investment loss (income), net | (50) | 227 |
Other, net | 17 | 17 |
Changes in assets and liabilities, net of dispositions: | ||
Receivables, net of allowance for credit losses | 109 | (201) |
Inventories | 66 | (192) |
Other assets | (7) | (25) |
Accounts payable | (79) | 79 |
Other liabilities, exclusive of debt | 16 | 8 |
Net cash from operating activities | 204 | 117 |
Cash flows from investing activities: | ||
Purchase of short-term investments | (627) | (263) |
Proceeds from sale of short-term investments | 507 | 408 |
Proceeds from maturity of short-term investments | 47 | 9 |
Capital expenditures | (219) | (273) |
Proceeds from the sale of property, plant and equipment | 20 | 13 |
Purchase of long-term investments | (10) | (33) |
Proceeds from the sale of subsidiaries, net of cash sold | 15 | |
Proceeds from sale of non-consolidated affiliates | 13 | |
Other, net | (8) | |
Net cash from investing activities | (282) | (119) |
Cash flows from financing activities: | ||
Uncommitted lines of credit, net | (89) | 96 |
Draws under committed lines of credit | 757 | 859 |
Repayments of committed lines of credit | (681) | (910) |
Principal payments of long-term debt | (4) | (5) |
Finance lease payments | (29) | (15) |
Dividends paid | (5) | (5) |
Net cash from financing activities | (51) | 20 |
Effect of exchange rate changes on cash and cash equivalents | (2) | 2 |
Net change in cash and cash equivalents | (131) | 20 |
Cash and cash equivalents at beginning of year | 199 | 75 |
Cash and cash equivalents at end of period | $ 68 | $ 95 |
Basis of Presentation and Accou
Basis of Presentation and Accounting Policies | 6 Months Ended |
Jul. 01, 2023 | |
Basis of Presentation and Accounting Policies | |
Basis of Presentation and Accounting Policies | Note 1 – Basis of Presentation and Accounting Policies Basis of Presentation The accompanying condensed consolidated financial statements of Seaboard Corporation and its subsidiaries (“Seaboard”) have been prepared in accordance with accounting principles generally accepted in the United States (“U.S. GAAP”) for interim financial information and with the rules and regulations for reporting on Form 10-Q. Accordingly, they do not include certain information and disclosures required for comprehensive financial statements. These condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and related notes included in Seaboard’s annual report on Form 10-K for the year ended December 31, 2022. The unaudited financial information reflects all adjustments, consisting only of normal recurring adjustments, which are, in the opinion of management, necessary for a fair presentation of the results of operations, financial position and cash flows for the periods presented. Seaboard’s first three quarterly periods include approximately 13 weekly periods ending on the Saturday closest to the end of March, June and September. Results of operations and cash flows for the periods presented are not necessarily indicative of results to be expected for the full year. Related-Party Transactions Seaboard has investments in several non-consolidated affiliates to further its business strategies and partner with other entities that have expertise in certain industries and countries. These investments are all accounted for using the equity method of accounting. Related-party transactions with these non-consolidated affiliates for product sales or services are identified on the statement of comprehensive income. As Seaboard conducts its agricultural commodity trading business with third parties, consolidated subsidiaries and non-consolidated affiliates on an interrelated basis, cost of sales on affiliate sales transactions cannot be distinguished without making numerous assumptions, primarily with respect to mark-to-market accounting for commodity derivatives. Purchases of raw materials or services from related parties included in Cost of sales were $18 million and $11 million for the three months ended July 1, 2023 and July 2, 2022, respectively, and $44 million and $18 million for the six months ended July 1, 2023 and July 2, 2022, respectively. Supplemental Cash Flow Information Non-cash investing activities for the six months ended July 1, 2023 included purchases of property, plant and equipment in accounts payable of $6 million. The following table includes supplemental cash and non-cash information related to leases. Seaboard reports the amortization of right-of-use (“ROU”) assets and changes in operating lease liabilities in other liabilities, exclusive of debt in the condensed consolidated statements of cash flows. Six Months Ended July 1, July 2, (Millions of dollars) 2023 2022 Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows from operating leases $ 97 $ 98 Operating cash flows from finance leases 3 3 Financing cash flows from finance leases 29 15 ROU assets obtained in exchange for new lease liabilities: Operating leases $ 41 $ 23 Finance leases 2 93 Goodwill and Other Intangible Assets The change in the carrying amount of goodwill was related to foreign currency translation differences of $8 million within the Commodity Trading and Milling (“CT&M”) segment. As of July 1, 2023, intangible assets, included in other non-current assets, were $30 million, which consists of the gross carrying amount of $79 million, net of accumulated amortization of $43 million and net of accumulated foreign currency translation of $6 million. |
Investments
Investments | 6 Months Ended |
Jul. 01, 2023 | |
Investments | |
Investments | Note 2 – Investments The following is a summary of the estimated fair value of short-term investments classified as trading securities: July 1, December 31, (Millions of dollars) 2023 2022 Domestic debt securities $ 472 $ 399 Domestic equity securities 361 433 Foreign equity securities 174 169 Money market funds held in trading accounts 117 12 Foreign debt securities 98 66 Other trading securities 3 7 Total trading short-term investments $ 1,225 $ 1,086 The unrealized gains (losses) related to trading securities still held at the end of the respective reporting period was $21 million and $53 million for the three- and six-months ended July 1, 2023, respectively, and ($110) million and ($150) million for the three- and six-months ended July 2, 2022, respectively. Seaboard had $20 million and $16 million of short-term investments denominated in foreign currencies, primarily euros, as of July 1, 2023 and December 31, 2022, respectively. As of July 1, 2023 and December 31, 2022, Seaboard had long-term investments of $188 million and $185 million, primarily in a business development company (“BDC”), real estate and renewable energy facilities. The BDC investment is included in the fair value hierarchy table in Note 5 and the other investments are primarily accounted for under the equity method of accounting. Long-term investments are classified in other non-current assets on the consolidated balance sheets. |
Inventories
Inventories | 6 Months Ended |
Jul. 01, 2023 | |
Inventories | |
Inventories | Note 3 – Inventories The following is a summary of inventories: July 1, December 31, (Millions of dollars) 2023 2022 At lower of FIFO cost and net realizable value (“NRV”): Hogs and materials $ 504 $ 538 Pork products and materials 74 75 Grains, oilseeds and other commodities 488 475 Biofuels and related credits 227 221 Other 102 104 Total inventories at lower of FIFO cost and NRV 1,395 1,413 Grain, flour and feed at lower of weighted average cost and NRV 215 257 Total inventories $ 1,610 $ 1,670 |
Lines of Credit, Long-Term Debt
Lines of Credit, Long-Term Debt, Commitments and Contingencies | 6 Months Ended |
Jul. 01, 2023 | |
Lines of Credit, Long-Term Debt, Commitments and Contingencies | |
Lines of Credit, Long-Term Debt, Commitments and Contingencies | Note 4 – Lines of Credit, Long-Term Debt, Commitments and Contingencies Lines of Credit As of July 1, 2023, the outstanding balances under committed and uncommitted lines of credit were $207 million and $237 million, respectively. Of the total outstanding balance as of July 1, 2023, $133 million was denominated in foreign currencies with $119 million denominated in the South African rand and the remaining in various other currencies. As of December 31, 2022, the outstanding balances under committed and uncommitted lines of credit were $131 million and $326 million, respectively. Of the total outstanding balance as of December 31, 2022, $194 million was denominated in foreign currencies, with $174 million denominated in the South African rand and the remaining in various other currencies. The weighted average interest rate for outstanding lines of credit was 7.08% and 7.03% as of July 1, 2023 and December 31, 2022, respectively. On March 28, 2023, Seaboard amended and restated its committed line of credit agreement to increase the borrowing capacity and extend the maturity date. This $450 million line of credit is secured by certain short-term investments and has a maturity date of March 28, 2025. Draws bear interest at the Secured Overnight Financing Rate (“SOFR”) plus a spread. Long-Term Debt Long-term debt includes borrowings under term loans and other contractual obligations, including notes payable. The following is a summary of long-term debt: July 1, December 31, (Millions of dollars) 2023 2022 Term Loan due 2028 $ 667 $ 670 Foreign subsidiary obligations 1 2 Other long-term debt 38 38 Total debt at face value 706 710 Current maturities and unamortized discount and costs (8) (8) Long-term debt, less current maturities and unamortized discount and costs $ 698 $ 702 On June 30, 2023, Seaboard amended and restated its Term Loan due 2028 credit agreement to change the interest reference rate from the London Inter-Bank Offered Rate (“LIBOR”) to SOFR due to the discontinuation of LIBOR as of June 30, 2023. The amendment was accounted for using the practical expedient option offered by current guidance which allows for contract modifications resulting in a new reference rate be accounted for as a continuation of the existing contract. The Term Loan due 2028 bears interest at fluctuating rates based on margins over a Base Rate or SOFR, at the option of the borrower, based on terms defined in credit agreement. The interest rate on the Term Loan due 2028 was 6.83% and 6.01% as of July 1, 2023 and December 31, 2022, respectively. Seaboard was in compliance with all restrictive debt covenants relating to these agreements as of July 1, 2023. Legal Proceedings Seaboard is subject to various legal proceedings and claims which arise in the ordinary course of business. In Seaboard’s opinion, it has made appropriate and adequate accruals for claims where necessary as of July 1, 2023; however, the ultimate liability for these matters is uncertain, and if significantly different than the amounts accrued, the outcome could have a material effect on the financial condition or results of operations of Seaboard. Costs for litigating claims are expensed as incurred. Helms-Burton Act Litigation On July 21, 2021, a lawsuit was filed by an individual, Odette Blanco de Fernandez (“Ms. de Fernandez”), and the heirs (“Inheritors”) and estates (“Estates”) of four of her siblings (Ms. de Fernandez, together with the Inheritors and the Estates being referred to as the “Plaintiffs”) against Seaboard Corporation in the U.S. District Court for the District of Delaware (the “Delaware District Court”), making claims under Title III of the Cuban Liberty and Solidarity Act of 1996, also known as the Helms-Burton Act (the “Act”). The same Plaintiffs filed a separate lawsuit against Seaboard Marine Ltd. (“Seaboard Marine”) on December 20, 2020, in the U.S. District Court for the Southern District of Florida (the “Florida District Court”). The complaints in each lawsuit seek unspecified damages (including treble damages) and pre filing interest as provided in the Act; pre-judgment interest; attorneys’ fees, costs and expenses; and such other relief as is just and proper. The Act provides that any person who knowingly and intentionally “traffics” in property which was confiscated by the Cuban government may be liable to any U.S. national who acquires an ownership interest in such property for money damages in an amount equal to the greater of the current fair market value of the property or the value of the property when confiscated, plus interest from the date of confiscation, reasonable attorneys’ fees and costs, and treble damages under certain circumstances. The complaint in each of the cases alleges that the Plaintiffs acquired ownership interests to a 70-year concession to develop port facilities at Mariel Bay, Cuba, and ownership of surrounding land, and that these and other property rights were confiscated by the Cuban government in 1960. The complaints further allege that Seaboard Corporation and Seaboard Marine knowingly and intentionally “trafficked” in the confiscated property within the meaning of the Act by carrying and/or directing cargo to the Port of Mariel. The Florida District Court in the Seaboard Marine case dismissed the claims of the Inheritors and the Estates because they did not acquire the ownership claims prior to March 1996, as required by the Act. The remaining plaintiff, Ms. de Fernandez, contends she owns 20% of the companies that were granted the concession and owned land in or around Mariel Bay, Cuba. On August 19, 2022, the Florida District Court granted Seaboard Marine’s Motion for Summary Judgment and entered a Final Judgment (the “Summary Judgment”) in favor of Seaboard Marine. On September 1, 2022, the Plaintiffs appealed the Summary Judgment to the United States Court of Appeals for the Eleventh Circuit (“Appeal”). As to the suit against Seaboard Corporation, on October 21, 2021, the Plaintiffs filed an amended complaint which principally added allegations that there were other callings made by Seaboard Marine at the Port of Mariel and that Seaboard Corporation engaged in a pattern of doing business with individuals and entities in contravention of U.S. foreign policy. Seaboard Corporation filed a Motion to Dismiss which is pending. On September 28, 2022, the Delaware District Court stayed this lawsuit against Seaboard Corporation until 30 days after the outcome of the appeal in the Seaboard Marine case. On March 24, 2023, the Plaintiffs, Seaboard Marine and Seaboard Corporation entered into a settlement agreement to settle the cases against Seaboard Marine and Seaboard Corporation for an immaterial amount that was contingent on the Florida District Court vacating the Summary Judgment entered in favor of Seaboard Marine on August 19, 2022. On June 13, 2023 the Florida District Court denied the Motion to Vacate the Summary Judgement and this denial order was not appealed. As such, the settlement is of no force and effect, and the Appeal will continue. Seaboard believes that it has meritorious defenses to the claims and intends to vigorously defend the litigation. However, the outcome of litigation is inherently unpredictable and subject to significant uncertainties, and if unfavorable, could result in a material liability. Pork Price-Fixing Antitrust Litigation On June 28, 2018, twelve indirect purchasers of pork products filed a class action complaint in the U.S. District Court for the District of Minnesota (the “Minnesota District Court”) against several pork processors, including Seaboard Foods LLC (“Seaboard Foods”) and Agri Stats, Inc., a company described in the complaint as a data sharing service. The complaint also named Seaboard Corporation as a defendant. Additional class action complaints with similar claims on behalf of putative classes of direct and indirect purchasers were later filed in the Minnesota District Court, and three additional actions by standalone plaintiffs (including the Commonwealth of Puerto Rico) were filed in or transferred to the Minnesota District Court. The consolidated actions are styled In re Pork Antitrust Litigation. The complaints allege, among other things, that beginning in January 2009, the defendants conspired and combined to fix, raise, maintain, and stabilize the price of pork products in violation of U.S. antitrust laws by coordinating output and limiting production, allegedly facilitated by the exchange of non-public information about prices, capacity, sales volume and demand through Agri Stats, Inc. The complaints on behalf of the putative classes of indirect purchasers also assert claims under various state laws, including state antitrust laws, unfair competition laws, consumer protection statutes, and common law unjust enrichment. The relief sought in the respective complaints includes treble damages, injunctive relief, pre- and post-judgment interest, costs and attorneys’ fees. On October 16, 2020, the Minnesota District Court denied the defendants’ motions to dismiss the amended complaints, but the Minnesota District Court later dismissed all claims against Seaboard Corporation without prejudice. On March 3, 2023, the Minnesota District Court granted the Plaintiffs’ Motions to Certify the Classes with respect to all three classes. Additional standalone plaintiffs filed similar actions in federal courts throughout the country, several of which named Seaboard Corporation as a defendant. Those actions filed in courts other than the District of Minnesota have been conditionally transferred to Minnesota for pretrial proceedings pursuant to an order by the Judicial Panel on Multidistrict Litigation. The states of New Mexico and Alaska filed civil cases in state court against substantially the same defendants, including Seaboard Foods and Seaboard Corporation, based on substantially similar allegations. Except in the New Mexico action, all claims against Seaboard Corporation have been dismissed without prejudice. On June 12, 2023, Seaboard Foods entered into a settlement agreement with the putative direct purchaser plaintiff class (the “DPP Class”), which settlement is subject to court approval. Pursuant to this agreement, Seaboard agreed to pay the DPP Class approximately $10 million, which Seaboard recognized as an expense within cost of sales in the condensed consolidated statements of comprehensive income for the three- and six-months ended July 1, 2023. Members of the class will have the opportunity to opt-out of the settlement and commence or continue their own actions. The settlement with the DPP Class does not cover the claims of (a) the standalone “direct action” plaintiffs, who will have the opportunity to opt-out of Seaboard’s settlement with the DPP Class, (b) other direct purchasers, if any, that elect to opt-out of the settlement and file their own actions against Seaboard, (c) the End User Consumer Indirect Purchaser Plaintiff Class (the “EUCP Class”) or (d) the Commercial and Industrial Indirect Purchaser Class (the “CIIP Class”). Seaboard will therefore continue to litigate against such opt-outs, the EUCP Class and the CIIP Class and will consider reasonable settlements where they are available. Seaboard believes that it has meritorious defenses to the claims alleged in these matters and intends to vigorously defend any matters not resolved by the above settlement. It is impossible at this stage either to determine the probability of a favorable or unfavorable outcome resulting from these suits, or to reasonably estimate the amount of potential loss or range of potential loss, if any, resulting from the suits. However, the outcome of litigation is inherently unpredictable and subject to significant uncertainties, and if unfavorable, could result in a material liability. Pork Compensation Antitrust Litigation On November 11, 2022, three employees of pork or beef processing plants filed a class action complaint (the “Class Action”) in the U.S. District Court for the District of Colorado (the “Court”) individually and on behalf of all other employees at such plants (the “Class”), against several pork and beef processors and their subsidiaries and related companies, including Seaboard Foods. The complaint alleges, among other things, that beginning in January 2014, the defendants conspired in violation of antitrust laws to fix and depress the compensation paid to the Class by, among other things, participating in third-party compensation surveys and exchanging wage-related information through a third-party benchmarking service. The relief sought includes treble damages, injunctive relief, pre- and post-judgment interest, costs and attorneys’ fees. On June 23, 2023, Seaboard Foods reached a settlement with the Class to settle the Class Action for an immaterial amount, which settlement is subject to approval of the Court. Members of the Class will have the opportunity to opt-out of the Class and commence their own actions. Cereoil and Nolston Litigation On March 20, 2018, the bankruptcy trustee (the “Trustee”) for Cereoil Uruguay S.A. (“Cereoil”) filed a suit in the Bankruptcy Court of First Instance in Uruguay naming as parties Seaboard Corporation and its subsidiaries, Seaboard Overseas Limited (“SOL”) and Seaboard Uruguay Holdings Ltd. (“Seaboard Uruguay”). Seaboard Corporation has a 45% indirect ownership of Cereoil. The suit (the “Clawback Action”) seeks an order requiring Seaboard Corporation, SOL and Seaboard Uruguay to reimburse Cereoil the amount of approximately $22 million (approximately $35 million with interest at the statutory rate) (the “Clawback Amount”), contending that deliveries of soybeans to SOL pursuant to purchase agreements should be set aside as fraudulent conveyances. Seaboard believes that it has meritorious defenses to the claims alleged in this matter and intends to vigorously defend this matter. It is impossible at this stage to determine the probability of a favorable or unfavorable outcome resulting from this suit. In the event of an adverse ruling, Seaboard and its two subsidiaries could be ordered to pay the Clawback Amount to Cereoil. On April 27, 2018, the Trustee filed an additional suit in the Bankruptcy Court of First Instance in Uruguay that was served during the second quarter of 2018, naming as parties Seaboard Corporation, SOL, Seaboard Uruguay, all directors of Cereoil, including two individuals employed by Seaboard who served as directors at the behest of Seaboard, and the Chief Financial Officer of Cereoil, an employee of Seaboard who also served at the behest of Seaboard (collectively, the “Cereoil Defendants”). The Trustee contends that the Cereoil Defendants acted with willful misconduct to cause Cereoil’s insolvency, and thus should be ordered to pay all liabilities of Cereoil, net of assets. The bankruptcy filing listed the U.S. dollar equivalent of liabilities of approximately $53 million and assets of approximately $30 million. Based on the administration of the case and the liquidation of assets, as of July 1, 2023 the U.S. dollar equivalent of liabilities is estimated to be approximately $48 million and the liquidation value of the assets is estimated to be $17 million or less. Seaboard believes that it has meritorious defenses to the claims alleged in this matter and intends to vigorously defend this matter. It is impossible at this stage to determine the probability of a favorable or unfavorable outcome resulting from this suit. In the event of an adverse ruling, Seaboard Corporation and the other Cereoil Defendants could be ordered to pay the liabilities of Cereoil, net of any amounts received from the liquidation of Cereoil’s assets, and could be ordered to pay an inflation adjustment, interest, the Trustee’s fees and other expenses. Any award in this case should be reduced by the amount of any award in the Clawback Action described above that is paid to Cereoil. On September 30, 2021, HSBC Bank (Uruguay) SA (“HSBC”), a creditor in the Cereoil bankruptcy proceeding pending in Uruguay, filed a suit in the U.S. District Court for the District of Kansas (the “Kansas District Court”) against Seaboard Corporation alleging claims for breach of contract, promissory estoppel, breach of the duty of good faith and fair dealing, unjust enrichment, fraud, negligent misrepresentation and fraud by concealment based upon a comfort letter, alleged statements by Cereoil personnel (including the Chief Financial Officer serving at the behest of Seaboard), and the same grain transactions that the Trustee challenges as fraudulent conveyances in the Cereoil bankruptcy in Uruguay discussed above. HSBC seeks $10 million plus interest and other relief in excess of $3 million. In March 2022, Seaboard filed a motion to dismiss HSBC’s claims on various grounds. On September 23, 2022, the Kansas District Court dismissed six of HSBC’s seven claims. Three of those claims, for fraud, negligent misrepresentation and fraud by concealment, can be refiled by HSBC in Uruguay. The other three claims, for breach of contract, breach of the duty of good faith and fair dealing and unjust enrichment, were dismissed with prejudice and cannot be refiled unless HSBC successfully appeals the Kansas District Court order. The one claim not dismissed in this matter is for promissory estoppel. Seaboard believes that it has meritorious defenses to this claim and intends to vigorously defend it. It is impossible to determine the probability of a favorable or unfavorable outcome resulting from this remaining claim. On May 15, 2018, the Trustee for Nolston S.A. (“Nolston”) filed a suit in the Bankruptcy Court of First Instance in Uruguay that was served during the second quarter of 2018, naming as parties Seaboard and the other Cereoil Defendants. Seaboard has a 45% indirect ownership of Nolston. The Trustee contends that the Cereoil Defendants acted with willful misconduct to cause Nolston’s insolvency, and thus should be ordered to pay all liabilities of Nolston, net of assets. The bankruptcy filing listed the U.S. dollar equivalent of liabilities of approximately $29 million and assets of $15 million. Based on the administration of the case which resulted in duplicative claims made in the Cereoil case and the liquidation of assets, as of July 1, 2023 the U.S. dollar equivalent of liabilities is estimated to be approximately $1 million, and there are no Guarantees Certain of Seaboard’s non-consolidated affiliates have debt supporting their underlying operations. From time to time, Seaboard will provide guarantees of such debt in order to further Seaboard’s business objectives. As of July 1, 2023, guarantees outstanding were not material. Seaboard has not accrued a liability for any of the guarantees as the likelihood of loss is remote. |
Derivatives and Fair Value of F
Derivatives and Fair Value of Financial Instruments | 6 Months Ended |
Jul. 01, 2023 | |
Derivatives and Fair Value of Financial Instruments | |
Derivatives and Fair Value of Financial Instruments | Note 5 – Derivatives and Fair Value of Financial Instruments The following tables show assets and liabilities measured at fair value on a recurring basis and the level within the fair value hierarchy used to measure each category of assets and liabilities. The trading securities classified as other current assets below are assets held for Seaboard’s deferred compensation plans. July 1, (Millions of dollars) 2023 Level 1 Level 2 Level 3 Assets: Trading securities – short-term investments: Domestic debt securities $ 472 $ 171 $ 301 $ — Domestic equity securities 361 361 — — Foreign equity securities 174 174 — — Money market funds held in trading accounts 117 117 — — Foreign debt securities 98 — 98 — Other trading securities 3 — 3 — Trading securities – other current assets 29 28 1 — Long-term investment - BDC 63 — 63 — Derivatives 7 4 3 — Total assets $ 1,324 $ 855 $ 469 $ — Liabilities: Contingent consideration $ 25 $ — $ — $ 25 Derivatives 14 13 1 — Total liabilities $ 39 $ 13 $ 1 $ 25 December 31, (Millions of dollars) 2022 Level 1 Level 2 Level 3 Assets: Trading securities – short-term investments: Domestic equity securities $ 433 $ 433 $ — $ — Domestic debt securities 399 162 237 — Foreign equity securities 169 169 — — Foreign debt securities 66 — 66 — Money market funds held in trading accounts 12 12 — — Other trading securities 7 — 7 — Trading securities – other current assets 26 25 1 — Long-term investment - BDC 63 — 63 — Derivatives 26 26 — — Total assets $ 1,201 $ 827 $ 374 $ — Liabilities: Contingent consideration $ 19 $ — $ — $ 19 Derivatives 12 2 10 — Total liabilities $ 31 $ 2 $ 10 $ 19 Financial instruments consisting of cash and cash equivalents, net receivables, lines of credit and accounts payable are carried at cost, which approximates fair value as a result of the short-term nature of the instruments. The fair value of short-term investments is measured using multiple levels. Domestic debt securities categorized as level 1 in the fair value hierarchy include debt securities held in mutual funds and exchange-traded funds. Seaboard has a long-term investment in a BDC that primarily lends to and invests in debt securities of privately held companies. This long-term investment is valued at net asset value, but is subject to contractual sale restrictions pursuant to shareholder arrangements. Seaboard’s contingent consideration is related to a 2018 acquisition. The fair value is dependent on the probability of the acquiree achieving certain financial performance targets using earnings before interest, taxes, depreciation and amortization (“EBITDA”) as a metric. The contingent consideration ranges between zero and $48 million payable between five The fair value of long-term debt is estimated by comparing interest rates for debt with similar terms and maturities. As Seaboard’s long-term debt is mostly variable-rate, its carrying amount approximates fair value. If Seaboard’s long-term debt was measured at fair value on its condensed consolidated balance sheets, it would have been classified as level 2 in the fair value hierarchy. See Note 4 for a discussion of Seaboard’s long-term debt. Seaboard’s operations are exposed to market risks from changes in commodity prices, foreign currency exchange rates, interest rates and equity prices. Seaboard uses various commodity derivative futures and options to manage its risk of price fluctuations for raw materials and other inventories, finished product sales and firm sales commitments. Seaboard also enters into foreign currency exchange agreements to manage the foreign currency exchange rate risk with respect to certain transactions denominated in foreign currencies. From time to time, Seaboard enters into interest rate swap agreements to manage the interest rate risk with respect to certain variable rate long-term debt and enters into equity futures contracts to manage the equity price risk with respect to certain short-term investments. Although management believes its derivatives are primarily economic hedges, Seaboard does not perform the extensive record-keeping required to account for these types of transactions as hedges for accounting purposes. These derivative contracts are recorded at fair value, with any changes in fair value recognized in the condensed consolidated statements of comprehensive income. As the derivative contracts are not accounted for as hedges, fluctuations in the related prices or rates could have a material impact on earnings in any given reporting period. The nature of Seaboard’s market risk exposure has not materially changed since December 31, 2022. Seaboard had the following aggregated outstanding notional amounts related to derivative financial instruments: July 1, December 31, (Millions) Metric 2023 2022 Commodities: Grain Bushels 23 8 Hogs Pounds 115 16 Soybean oil Pounds 92 26 Foreign currencies U.S. dollar 8 190 Credit risks associated with these derivative contracts are not significant because Seaboard minimizes counterparty exposure by dealing with credit-worthy counterparties and using margin accounts for some contracts. As of July 1, 2023, the maximum amount of credit risk, had the counterparties failed to perform according to the terms of the contract, was $1 million. The following table provides the fair value of each type of derivative held and where each derivative is included in the condensed consolidated balance sheets: Asset Liability July 1, December 31, July 1, December 31, (Millions of dollars) 2023 2022 2023 2022 Commodities Other current assets $ 6 $ 26 Other current liabilities $ 13 $ 2 Foreign currencies Other current assets 1 — Other current liabilities 1 10 Seaboard’s commodity derivative assets and liabilities are presented in the condensed consolidated balance sheets on a net basis, including netting the derivatives with the related margin accounts. As of July 1, 2023 and December 31, 2022, the commodity derivatives had a margin account balance of $50 million and $3 million, respectively, resulting in a net other current asset in the condensed consolidated balance sheets of $43 million and $27 million, respectively. The following table provides the amount of gain or (loss) recognized in income for each type of derivative and where it was recognized in the condensed consolidated statements of comprehensive income: Three Months Ended Six Months Ended July 1, July 2, July 1, July 2, (Millions of dollars) 2023 2022 2023 2022 Commodities Cost of sales $ (22) $ (30) $ (25) $ (58) Foreign currencies Cost of sales (1) (5) 2 (6) Foreign currencies Foreign currency gains (losses), net (2) 8 (4) 9 |
Stockholders' Equity and Accumu
Stockholders' Equity and Accumulated Other Comprehensive Loss | 6 Months Ended |
Jul. 01, 2023 | |
Stockholders' Equity and Accumulated Other Comprehensive Loss | |
Stockholders' Equity and Accumulated Other Comprehensive Loss | Note 6 – Stockholders’ Equity and Accumulated Other Comprehensive Loss The components of accumulated other comprehensive loss (“AOCL”), net of related taxes, were as follows: Cumulative Foreign Cumulative Currency Unrecognized Translation Pension (Millions of dollars) Adjustment Cost Total Balance December 31, 2021 $ (368) $ (64) $ (432) Other comprehensive loss before reclassifications (10) (1) (11) Amounts reclassified from AOCL to net earnings 9 (b) 1 (a) 10 Other comprehensive loss, net of tax (1) — (1) Balance April 2, 2022 $ (369) $ (64) $ (433) Other comprehensive loss before reclassifications (2) — (2) Amounts reclassified from AOCL to net earnings — 1 (a) 1 Other comprehensive income (loss), net of tax (2) 1 (1) Balance July 2, 2022 $ (371) $ (63) $ (434) Balance December 31, 2022 $ (401) $ (21) $ (422) Other comprehensive income before reclassifications 12 1 13 Amounts reclassified from AOCL to net earnings — 1 (a) 1 Other comprehensive income, net of tax 12 2 14 Balance April 1, 2023 $ (389) $ (19) $ (408) Other comprehensive income before reclassifications 1 2 3 Amounts reclassified from AOCL to net earnings — — (a) — Other comprehensive income, net of tax 1 2 3 Balance July 1, 2023 $ (388) $ (17) $ (405) (a) This reclassification adjustment primarily represents the amortization of actuarial losses (gains) that were included in net periodic pension cost. (b) This reclassification adjustment reflects the recognition of a currency translation adjustment upon the disposition of a CT&M business in Brazil whose functional currency was the Brazilian real. |
Segment Information
Segment Information | 6 Months Ended |
Jul. 01, 2023 | |
Segment Information | |
Segment Information | Note 7 – Segment Information Seaboard has six reportable segments: Pork, CT&M, Marine, Sugar and Alcohol, Power, and Turkey, each offering a specific product or service. For details on the respective products or services of each segment, see Note 13 to the consolidated financial statements included in Seaboard’s annual report for the year ended December 31, 2022. There were no significant segment updates during the first half of 2023. The following tables present Seaboard’s sales disaggregated by revenue source and segment: Net Sales: Three Months Ended July 1, 2023 Sugar and All Consolidated (Millions of dollars) Pork CT&M Marine Alcohol Power Other Totals Major Products/Services Lines: Products $ 434 $ 1,332 $ — $ 40 $ — $ 2 $ 1,808 Transportation 3 — 356 — — 2 361 Energy 149 — — — 63 — 212 Other 9 3 — — — — 12 Segment/Consolidated Totals $ 595 $ 1,335 $ 356 $ 40 $ 63 $ 4 $ 2,393 Net Sales: Three Months Ended July 2, 2022 Sugar and All Consolidated (Millions of dollars) Pork CT&M Marine Alcohol Power Other Totals Major Products/Services Lines: Products $ 513 $ 1,707 $ — $ 24 $ — $ 4 $ 2,248 Transportation 3 — 523 — — 1 527 Energy 140 — — — 47 — 187 Other 7 4 — — — — 11 Segment/Consolidated Totals $ 663 $ 1,711 $ 523 $ 24 $ 47 $ 5 $ 2,973 Net Sales: Six Months Ended July 1, 2023 Sugar and All Consolidated (Millions of dollars) Pork CT&M Marine Alcohol Power Other Totals Major Products/Services Lines: Products $ 862 $ 2,673 $ — $ 78 $ — $ 5 $ 3,618 Transportation 6 — 804 — — 2 812 Energy 323 — — — 115 — 438 Other 18 6 — — — — 24 Segment/Consolidated Totals $ 1,209 $ 2,679 $ 804 $ 78 $ 115 $ 7 $ 4,892 Net Sales: Six Months Ended July 2, 2022 Sugar and All Consolidated (Millions of dollars) Pork CT&M Marine Alcohol Power Other Totals Major Products/Services Lines: Products $ 1,004 $ 3,274 $ — $ 55 $ — $ 8 $ 4,341 Transportation 5 — 989 — — 1 995 Energy 261 — — — 65 — 326 Other 13 7 — — — — 20 Segment/Consolidated Totals $ 1,283 $ 3,281 $ 989 $ 55 $ 65 $ 9 $ 5,682 The following tables present Seaboard’s operating income (loss) and income (loss) from affiliates by segment. Operating income (loss) for segment reporting is prepared on the same basis as that used for consolidated operating income. Operating income (loss), along with income or loss from affiliates for the Pork, CT&M and Turkey segments, is used as the measure of evaluating segment performance because management does not consider interest, other investment income (loss) and income tax benefit (expense) on a segment basis. Administrative services provided by the corporate office are allocated to the individual segments and represent corporate services rendered to and costs incurred for each specific segment, with no allocation to individual segments of general corporate management oversight costs. Operating Income (Loss): Three Months Ended Six Months Ended July 1, July 2, July 1, July 2, (Millions of dollars) 2023 2022 2023 2022 Pork $ (104) $ 1 $ (316) $ 28 CT&M 17 30 60 42 Marine 60 155 156 268 Sugar and Alcohol 3 — 9 2 Power 22 6 32 1 All Other 1 1 1 1 Segment Totals (1) 193 (58) 342 Corporate (3) (1) (9) (4) Consolidated Totals $ (4) $ 192 $ (67) $ 338 Income (Loss) from Affiliates: Three Months Ended Six Months Ended July 1, July 2, July 1, July 2, (Millions of dollars) 2023 2022 2023 2022 Pork $ 9 $ 7 $ 19 $ 7 CT&M (2) 4 (10) 9 Marine 2 1 1 3 Sugar and Alcohol — — — — Power — — — — Turkey 16 11 41 27 Segment/Consolidated Totals $ 25 $ 23 $ 51 $ 46 The following tables present total assets by segment and the investments in and advances to affiliates by segment. Corporate assets primarily include cash and short-term investments, other current assets related to deferred compensation plans, long-term investments and other miscellaneous items. Corporate operating results represent certain operating costs not specifically allocated to individual segments and include costs related to Seaboard’s deferred compensation plans, which are offset by the effect of the mark-to-market adjustments on these investments recorded in other investment income (loss), net. Total Assets: July 1, December 31, (Millions of dollars) 2023 2022 Pork $ 2,724 $ 2,698 CT&M 1,805 1,915 Marine 800 882 Sugar and Alcohol 164 165 Power 345 342 Turkey 351 350 All Other 5 6 Segment Totals 6,194 6,358 Corporate 1,611 1,544 Consolidated Totals $ 7,805 $ 7,902 Investments in and Advances to Affiliates: July 1, December 31, (Millions of dollars) 2023 2022 Pork $ 153 $ 152 CT&M 188 210 Marine 37 36 Sugar and Alcohol 2 2 Power 3 3 Turkey 351 350 Segment/Consolidated Totals $ 734 $ 753 The Turkey segment, accounted for using the equity method, represents Seaboard’s investment in Butterball, LLC (“Butterball”). As of July 1, 2023 and December 31, 2022, Butterball had total assets of $1.2 billion and $1.1 billion, respectively. Butterball’s summarized income statement information was as follows: Three Months Ended Six Months Ended July 1, July 2, July 1, July 2, (Millions of dollars) 2023 2022 2023 2022 Net sales $ 458 $ 417 $ 866 $ 816 Operating income $ 36 $ 27 $ 86 $ 40 Net earnings $ 31 $ 21 $ 79 $ 51 |
Basis of Presentation and Acc_2
Basis of Presentation and Accounting Policies (Policies) | 6 Months Ended |
Jul. 01, 2023 | |
Basis of Presentation and Accounting Policies | |
Basis of Presentation | Basis of Presentation The accompanying condensed consolidated financial statements of Seaboard Corporation and its subsidiaries (“Seaboard”) have been prepared in accordance with accounting principles generally accepted in the United States (“U.S. GAAP”) for interim financial information and with the rules and regulations for reporting on Form 10-Q. Accordingly, they do not include certain information and disclosures required for comprehensive financial statements. These condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and related notes included in Seaboard’s annual report on Form 10-K for the year ended December 31, 2022. The unaudited financial information reflects all adjustments, consisting only of normal recurring adjustments, which are, in the opinion of management, necessary for a fair presentation of the results of operations, financial position and cash flows for the periods presented. Seaboard’s first three quarterly periods include approximately 13 weekly periods ending on the Saturday closest to the end of March, June and September. Results of operations and cash flows for the periods presented are not necessarily indicative of results to be expected for the full year. |
Related-party Transactions | Related-Party Transactions Seaboard has investments in several non-consolidated affiliates to further its business strategies and partner with other entities that have expertise in certain industries and countries. These investments are all accounted for using the equity method of accounting. Related-party transactions with these non-consolidated affiliates for product sales or services are identified on the statement of comprehensive income. As Seaboard conducts its agricultural commodity trading business with third parties, consolidated subsidiaries and non-consolidated affiliates on an interrelated basis, cost of sales on affiliate sales transactions cannot be distinguished without making numerous assumptions, primarily with respect to mark-to-market accounting for commodity derivatives. Purchases of raw materials or services from related parties included in Cost of sales were $18 million and $11 million for the three months ended July 1, 2023 and July 2, 2022, respectively, and $44 million and $18 million for the six months ended July 1, 2023 and July 2, 2022, respectively. |
Supplemental Cash Flow Information | Supplemental Cash Flow Information Non-cash investing activities for the six months ended July 1, 2023 included purchases of property, plant and equipment in accounts payable of $6 million. The following table includes supplemental cash and non-cash information related to leases. Seaboard reports the amortization of right-of-use (“ROU”) assets and changes in operating lease liabilities in other liabilities, exclusive of debt in the condensed consolidated statements of cash flows. Six Months Ended July 1, July 2, (Millions of dollars) 2023 2022 Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows from operating leases $ 97 $ 98 Operating cash flows from finance leases 3 3 Financing cash flows from finance leases 29 15 ROU assets obtained in exchange for new lease liabilities: Operating leases $ 41 $ 23 Finance leases 2 93 |
Goodwill and Other Intangible Assets | Goodwill and Other Intangible Assets The change in the carrying amount of goodwill was related to foreign currency translation differences of $8 million within the Commodity Trading and Milling (“CT&M”) segment. As of July 1, 2023, intangible assets, included in other non-current assets, were $30 million, which consists of the gross carrying amount of $79 million, net of accumulated amortization of $43 million and net of accumulated foreign currency translation of $6 million. |
Basis of Presentation and Acc_3
Basis of Presentation and Accounting Policies (Tables) | 6 Months Ended |
Jul. 01, 2023 | |
Basis of Presentation and Accounting Policies | |
Summary of supplemental cash and non-cash information related to leases | Six Months Ended July 1, July 2, (Millions of dollars) 2023 2022 Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows from operating leases $ 97 $ 98 Operating cash flows from finance leases 3 3 Financing cash flows from finance leases 29 15 ROU assets obtained in exchange for new lease liabilities: Operating leases $ 41 $ 23 Finance leases 2 93 |
Investments (Tables)
Investments (Tables) | 6 Months Ended |
Jul. 01, 2023 | |
Investments | |
Summary of the estimated fair value of short-term investments classified as trading securities | July 1, December 31, (Millions of dollars) 2023 2022 Domestic debt securities $ 472 $ 399 Domestic equity securities 361 433 Foreign equity securities 174 169 Money market funds held in trading accounts 117 12 Foreign debt securities 98 66 Other trading securities 3 7 Total trading short-term investments $ 1,225 $ 1,086 |
Inventories (Tables)
Inventories (Tables) | 6 Months Ended |
Jul. 01, 2023 | |
Inventories | |
Summary of inventories | July 1, December 31, (Millions of dollars) 2023 2022 At lower of FIFO cost and net realizable value (“NRV”): Hogs and materials $ 504 $ 538 Pork products and materials 74 75 Grains, oilseeds and other commodities 488 475 Biofuels and related credits 227 221 Other 102 104 Total inventories at lower of FIFO cost and NRV 1,395 1,413 Grain, flour and feed at lower of weighted average cost and NRV 215 257 Total inventories $ 1,610 $ 1,670 |
Lines of Credit, Long-Term De_2
Lines of Credit, Long-Term Debt, Commitments and Contingencies (Tables) | 6 Months Ended |
Jul. 01, 2023 | |
Lines of Credit, Long-Term Debt, Commitments and Contingencies | |
Summary of long-term debt | July 1, December 31, (Millions of dollars) 2023 2022 Term Loan due 2028 $ 667 $ 670 Foreign subsidiary obligations 1 2 Other long-term debt 38 38 Total debt at face value 706 710 Current maturities and unamortized discount and costs (8) (8) Long-term debt, less current maturities and unamortized discount and costs $ 698 $ 702 |
Derivatives and Fair Value of_2
Derivatives and Fair Value of Financial Instruments (Tables) | 6 Months Ended |
Jul. 01, 2023 | |
Derivatives and Fair Value of Financial Instruments | |
Schedule of assets and liabilities measured at fair value on a recurring basis | July 1, (Millions of dollars) 2023 Level 1 Level 2 Level 3 Assets: Trading securities – short-term investments: Domestic debt securities $ 472 $ 171 $ 301 $ — Domestic equity securities 361 361 — — Foreign equity securities 174 174 — — Money market funds held in trading accounts 117 117 — — Foreign debt securities 98 — 98 — Other trading securities 3 — 3 — Trading securities – other current assets 29 28 1 — Long-term investment - BDC 63 — 63 — Derivatives 7 4 3 — Total assets $ 1,324 $ 855 $ 469 $ — Liabilities: Contingent consideration $ 25 $ — $ — $ 25 Derivatives 14 13 1 — Total liabilities $ 39 $ 13 $ 1 $ 25 December 31, (Millions of dollars) 2022 Level 1 Level 2 Level 3 Assets: Trading securities – short-term investments: Domestic equity securities $ 433 $ 433 $ — $ — Domestic debt securities 399 162 237 — Foreign equity securities 169 169 — — Foreign debt securities 66 — 66 — Money market funds held in trading accounts 12 12 — — Other trading securities 7 — 7 — Trading securities – other current assets 26 25 1 — Long-term investment - BDC 63 — 63 — Derivatives 26 26 — — Total assets $ 1,201 $ 827 $ 374 $ — Liabilities: Contingent consideration $ 19 $ — $ — $ 19 Derivatives 12 2 10 — Total liabilities $ 31 $ 2 $ 10 $ 19 |
Schedule of aggregated outstanding notional amounts related to derivative financial instruments | July 1, December 31, (Millions) Metric 2023 2022 Commodities: Grain Bushels 23 8 Hogs Pounds 115 16 Soybean oil Pounds 92 26 Foreign currencies U.S. dollar 8 190 |
Schedule of fair value of each type of derivative derivative held and where each derivative is included in the condensed consolidated balance sheets | Asset Liability July 1, December 31, July 1, December 31, (Millions of dollars) 2023 2022 2023 2022 Commodities Other current assets $ 6 $ 26 Other current liabilities $ 13 $ 2 Foreign currencies Other current assets 1 — Other current liabilities 1 10 |
Schedule of gain or (loss) for each type of derivative and where it was recognized in the condensed consolidated statements of comprehensive income | Three Months Ended Six Months Ended July 1, July 2, July 1, July 2, (Millions of dollars) 2023 2022 2023 2022 Commodities Cost of sales $ (22) $ (30) $ (25) $ (58) Foreign currencies Cost of sales (1) (5) 2 (6) Foreign currencies Foreign currency gains (losses), net (2) 8 (4) 9 |
Stockholders Equity and Accumul
Stockholders Equity and Accumulated Other Comprehensive Loss (Tables) | 6 Months Ended |
Jul. 01, 2023 | |
Stockholders' Equity and Accumulated Other Comprehensive Loss | |
Schedule of components of accumulated other comprehensive loss, net of related taxes | Cumulative Foreign Cumulative Currency Unrecognized Translation Pension (Millions of dollars) Adjustment Cost Total Balance December 31, 2021 $ (368) $ (64) $ (432) Other comprehensive loss before reclassifications (10) (1) (11) Amounts reclassified from AOCL to net earnings 9 (b) 1 (a) 10 Other comprehensive loss, net of tax (1) — (1) Balance April 2, 2022 $ (369) $ (64) $ (433) Other comprehensive loss before reclassifications (2) — (2) Amounts reclassified from AOCL to net earnings — 1 (a) 1 Other comprehensive income (loss), net of tax (2) 1 (1) Balance July 2, 2022 $ (371) $ (63) $ (434) Balance December 31, 2022 $ (401) $ (21) $ (422) Other comprehensive income before reclassifications 12 1 13 Amounts reclassified from AOCL to net earnings — 1 (a) 1 Other comprehensive income, net of tax 12 2 14 Balance April 1, 2023 $ (389) $ (19) $ (408) Other comprehensive income before reclassifications 1 2 3 Amounts reclassified from AOCL to net earnings — — (a) — Other comprehensive income, net of tax 1 2 3 Balance July 1, 2023 $ (388) $ (17) $ (405) (a) This reclassification adjustment primarily represents the amortization of actuarial losses (gains) that were included in net periodic pension cost. (b) This reclassification adjustment reflects the recognition of a currency translation adjustment upon the disposition of a CT&M business in Brazil whose functional currency was the Brazilian real. |
Segment Information (Tables)
Segment Information (Tables) | 6 Months Ended |
Jul. 01, 2023 | |
Segment Information | |
Schedule of sales disaggregated by revenue source and segment | Net Sales: Three Months Ended July 1, 2023 Sugar and All Consolidated (Millions of dollars) Pork CT&M Marine Alcohol Power Other Totals Major Products/Services Lines: Products $ 434 $ 1,332 $ — $ 40 $ — $ 2 $ 1,808 Transportation 3 — 356 — — 2 361 Energy 149 — — — 63 — 212 Other 9 3 — — — — 12 Segment/Consolidated Totals $ 595 $ 1,335 $ 356 $ 40 $ 63 $ 4 $ 2,393 Net Sales: Three Months Ended July 2, 2022 Sugar and All Consolidated (Millions of dollars) Pork CT&M Marine Alcohol Power Other Totals Major Products/Services Lines: Products $ 513 $ 1,707 $ — $ 24 $ — $ 4 $ 2,248 Transportation 3 — 523 — — 1 527 Energy 140 — — — 47 — 187 Other 7 4 — — — — 11 Segment/Consolidated Totals $ 663 $ 1,711 $ 523 $ 24 $ 47 $ 5 $ 2,973 Net Sales: Six Months Ended July 1, 2023 Sugar and All Consolidated (Millions of dollars) Pork CT&M Marine Alcohol Power Other Totals Major Products/Services Lines: Products $ 862 $ 2,673 $ — $ 78 $ — $ 5 $ 3,618 Transportation 6 — 804 — — 2 812 Energy 323 — — — 115 — 438 Other 18 6 — — — — 24 Segment/Consolidated Totals $ 1,209 $ 2,679 $ 804 $ 78 $ 115 $ 7 $ 4,892 Net Sales: Six Months Ended July 2, 2022 Sugar and All Consolidated (Millions of dollars) Pork CT&M Marine Alcohol Power Other Totals Major Products/Services Lines: Products $ 1,004 $ 3,274 $ — $ 55 $ — $ 8 $ 4,341 Transportation 5 — 989 — — 1 995 Energy 261 — — — 65 — 326 Other 13 7 — — — — 20 Segment/Consolidated Totals $ 1,283 $ 3,281 $ 989 $ 55 $ 65 $ 9 $ 5,682 |
Summary of specific financial information related to operating income (loss) | Operating Income (Loss): Three Months Ended Six Months Ended July 1, July 2, July 1, July 2, (Millions of dollars) 2023 2022 2023 2022 Pork $ (104) $ 1 $ (316) $ 28 CT&M 17 30 60 42 Marine 60 155 156 268 Sugar and Alcohol 3 — 9 2 Power 22 6 32 1 All Other 1 1 1 1 Segment Totals (1) 193 (58) 342 Corporate (3) (1) (9) (4) Consolidated Totals $ (4) $ 192 $ (67) $ 338 |
Summary of specific financial information related to income (loss) from affiliates | Income (Loss) from Affiliates: Three Months Ended Six Months Ended July 1, July 2, July 1, July 2, (Millions of dollars) 2023 2022 2023 2022 Pork $ 9 $ 7 $ 19 $ 7 CT&M (2) 4 (10) 9 Marine 2 1 1 3 Sugar and Alcohol — — — — Power — — — — Turkey 16 11 41 27 Segment/Consolidated Totals $ 25 $ 23 $ 51 $ 46 |
Summary of specific financial information related to total assets | Total Assets: July 1, December 31, (Millions of dollars) 2023 2022 Pork $ 2,724 $ 2,698 CT&M 1,805 1,915 Marine 800 882 Sugar and Alcohol 164 165 Power 345 342 Turkey 351 350 All Other 5 6 Segment Totals 6,194 6,358 Corporate 1,611 1,544 Consolidated Totals $ 7,805 $ 7,902 |
Summary of specific financial information related to investments in and advances to affiliates | Investments in and Advances to Affiliates: July 1, December 31, (Millions of dollars) 2023 2022 Pork $ 153 $ 152 CT&M 188 210 Marine 37 36 Sugar and Alcohol 2 2 Power 3 3 Turkey 351 350 Segment/Consolidated Totals $ 734 $ 753 |
Butterball, LLC | |
Segment Information | |
Summary of specific financial information related to equity method | Three Months Ended Six Months Ended July 1, July 2, July 1, July 2, (Millions of dollars) 2023 2022 2023 2022 Net sales $ 458 $ 417 $ 866 $ 816 Operating income $ 36 $ 27 $ 86 $ 40 Net earnings $ 31 $ 21 $ 79 $ 51 |
Basis of Presentation and Acc_4
Basis of Presentation and Accounting Policies (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jul. 01, 2023 | Jul. 02, 2022 | Jul. 01, 2023 | Jul. 02, 2022 | |
Related Party Transactions | ||||
Cost of sales | $ 2,297 | $ 2,692 | $ 4,762 | $ 5,165 |
Supplemental Cash Flow Information | ||||
Capital expenditures included in accounts payable | 6 | |||
Operating cash flows from operating leases | 97 | 98 | ||
Operating cash flows from finance leases | 3 | 3 | ||
Financing cash flows from finance leases | 29 | 15 | ||
ROU assets obtained in exchange for new operating lease liabilities | 41 | 23 | ||
ROU assets obtained in exchange for new finance lease liabilities | 2 | 93 | ||
Goodwill and Other Intangible Assets | ||||
Intangible assets, net | 30 | 30 | ||
Intangible assets gross carrying amount | 79 | 79 | ||
Intangible assets accumulated amortization | 43 | 43 | ||
Foreign currency exchange adjustments | 6 | |||
Commodity Trading and Milling | ||||
Goodwill and Other Intangible Assets | ||||
Goodwill foreign currency translation | 8 | |||
Affiliates | ||||
Related Party Transactions | ||||
Cost of sales | $ 18 | $ 11 | $ 44 | $ 18 |
Investments (Details)
Investments (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | |||
Jul. 01, 2023 | Jul. 02, 2022 | Jul. 01, 2023 | Jul. 02, 2022 | Dec. 31, 2022 | |
Investments | |||||
Total trading short-term investments | $ 1,225 | $ 1,225 | $ 1,086 | ||
Unrealized gains (losses) on trading securities | 21 | $ (110) | 53 | $ (150) | |
Long term investments | 188 | 188 | 185 | ||
Funding of long-term investment | 10 | $ 33 | |||
Denominated in foreign currencies | |||||
Investments | |||||
Total trading short-term investments | 20 | 20 | 16 | ||
Domestic debt securities | |||||
Investments | |||||
Fair Value | 472 | 472 | 399 | ||
Domestic equity securities | |||||
Investments | |||||
Fair Value | 361 | 361 | 433 | ||
Foreign equity securities | |||||
Investments | |||||
Fair Value | 174 | 174 | 169 | ||
Foreign debt securities | |||||
Investments | |||||
Fair Value | 98 | 98 | 66 | ||
Money market funds held in trading accounts | |||||
Investments | |||||
Fair Value | 117 | 117 | 12 | ||
Other trading securities | |||||
Investments | |||||
Fair Value | $ 3 | $ 3 | $ 7 |
Inventories (Details)
Inventories (Details) - USD ($) $ in Millions | Jul. 01, 2023 | Dec. 31, 2022 |
At lower of FIFO cost and NRV: | ||
Hogs and materials | $ 504 | $ 538 |
Pork products and materials | 74 | 75 |
Grains, oilseeds and other commodities | 488 | 475 |
Biofuels and related credits | 227 | 221 |
Other | 102 | 104 |
Total inventories at lower of FIFO cost and NRV | 1,395 | 1,413 |
Grain, flour and feed at lower of weighted average cost and NRV | 215 | 257 |
Total inventories | $ 1,610 | $ 1,670 |
Lines of Credit, Long-Term De_3
Lines of Credit, Long-Term Debt, Commitments and Contingencies (Details) | 6 Months Ended | |||||||||||||
Jun. 12, 2023 USD ($) | Nov. 11, 2022 employee | Sep. 23, 2022 claim | Sep. 30, 2021 USD ($) | Jul. 21, 2021 USD ($) | Jun. 28, 2018 plaintiff | Mar. 20, 2018 USD ($) subsidiary | Jul. 01, 2023 USD ($) | Dec. 31, 2018 plaintiff | Mar. 28, 2023 USD ($) | Dec. 31, 2022 USD ($) | Sep. 22, 2022 claim | May 15, 2018 USD ($) | Apr. 27, 2018 USD ($) employee | |
Lines of Credit, Long-Term Debt, Commitments and Contingencies | ||||||||||||||
Other long-term debt | $ 38,000,000 | $ 38,000,000 | ||||||||||||
Total debt at face value | 706,000,000 | 710,000,000 | ||||||||||||
Current maturities of long-term debt and unamortized discount | (8,000,000) | (8,000,000) | ||||||||||||
Long-term debt, less current maturities | 698,000,000 | 702,000,000 | ||||||||||||
Contingencies | ||||||||||||||
Total liabilities | 2,743,000,000 | 2,888,000,000 | ||||||||||||
Assets | 7,805,000,000 | $ 7,902,000,000 | ||||||||||||
Pork Product Purchasers | Pending Litigation | ||||||||||||||
Contingencies | ||||||||||||||
Number of plaintiffs | plaintiff | 12 | 3 | ||||||||||||
Pork Compensation Antitrust | Pending Litigation | ||||||||||||||
Contingencies | ||||||||||||||
Number of plaintiffs | employee | 3 | |||||||||||||
Cereoil Bankruptcy Trustee - Case One | Pending Litigation | ||||||||||||||
Contingencies | ||||||||||||||
Damages sought | $ 22,000,000 | |||||||||||||
Damages sought, including interest | 35,000,000 | |||||||||||||
Number of subsidiaries | subsidiary | 2 | |||||||||||||
Cereoil Bankruptcy Trustee - Case Two | Pending Litigation | ||||||||||||||
Contingencies | ||||||||||||||
Number of individuals employed by Seaboard serving as directors | employee | 2 | |||||||||||||
Total liabilities | 48,000,000 | $ 53,000,000 | ||||||||||||
Assets | $ 30,000,000 | |||||||||||||
Cereoil Bankruptcy Trustee - Case Two | Pending Litigation | Maximum | ||||||||||||||
Contingencies | ||||||||||||||
Assets | 17,000,000 | |||||||||||||
Nolston Bankruptcy Trustee | Pending Litigation | ||||||||||||||
Contingencies | ||||||||||||||
Total liabilities | 1,000,000 | $ 29,000,000 | ||||||||||||
Assets | $ 0 | $ 15,000,000 | ||||||||||||
Odette Blanco De Fernandez | Pending Litigation | ||||||||||||||
Contingencies | ||||||||||||||
Number of siblings added as plaintiffs | 4 | |||||||||||||
Term of concession to develop port facilities | 70 years | |||||||||||||
Claimed ownership percentage of companies that owned concession and land | 20% | |||||||||||||
DPP Class | Pending Litigation | ||||||||||||||
Contingencies | ||||||||||||||
Settlement amount | $ 10,000,000 | |||||||||||||
HSBC | Pending Litigation | ||||||||||||||
Contingencies | ||||||||||||||
Number of claims | claim | 1 | 7 | ||||||||||||
Number of claims that were dismissed by a court | claim | 6 | |||||||||||||
Number of claims dismissed that can be refiled | claim | 3 | |||||||||||||
Number of claims dismissed that cannot be refiled unless successfully appealed | claim | 3 | |||||||||||||
Damages sought | $ 10,000,000 | |||||||||||||
Interest and other relief sought | $ 3,000,000 | |||||||||||||
Cereoil | ||||||||||||||
Contingencies | ||||||||||||||
Percentage of ownership | 45% | |||||||||||||
Nolston | ||||||||||||||
Contingencies | ||||||||||||||
Percentage of ownership | 45% | |||||||||||||
Committed and uncommitted bank lines | ||||||||||||||
Lines of Credit, Long-Term Debt, Commitments and Contingencies | ||||||||||||||
Weighted average interest rate (as a percent) | 7.08% | 7.03% | ||||||||||||
Committed and uncommitted bank lines | Denominated in foreign currencies | ||||||||||||||
Lines of Credit, Long-Term Debt, Commitments and Contingencies | ||||||||||||||
Lines of credit outstanding | $ 133,000,000 | $ 194,000,000 | ||||||||||||
Committed and uncommitted bank lines | South African Rand | ||||||||||||||
Lines of Credit, Long-Term Debt, Commitments and Contingencies | ||||||||||||||
Lines of credit outstanding | 119,000,000 | 174,000,000 | ||||||||||||
Committed bank lines | ||||||||||||||
Lines of Credit, Long-Term Debt, Commitments and Contingencies | ||||||||||||||
Lines of credit outstanding | 207,000,000 | 131,000,000 | ||||||||||||
Maximum capacity | 450,000,000 | $ 450,000,000 | ||||||||||||
Uncommitted bank lines | ||||||||||||||
Lines of Credit, Long-Term Debt, Commitments and Contingencies | ||||||||||||||
Lines of credit outstanding | 237,000,000 | 326,000,000 | ||||||||||||
Term loan due 2028 | ||||||||||||||
Lines of Credit, Long-Term Debt, Commitments and Contingencies | ||||||||||||||
Total debt at face value | $ 667,000,000 | $ 670,000,000 | ||||||||||||
Effective interest rate (as a percent) | 6.83% | 6.01% | ||||||||||||
Foreign subsidiary obligations | ||||||||||||||
Lines of Credit, Long-Term Debt, Commitments and Contingencies | ||||||||||||||
Total debt at face value | $ 1,000,000 | $ 2,000,000 |
Derivatives and Fair Value of_3
Derivatives and Fair Value of Financial Instruments-Deferred Comp Securities (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2018 | Jul. 01, 2023 | Dec. 31, 2022 | |
Assets: | |||
Long-term investment | $ 188 | $ 185 | |
Mimran | |||
Investments | |||
Contingent consideration, low end of range | $ 0 | ||
Contingent consideration, high end of range | $ 48 | ||
Minimum contingent consideration payout period | 5 years | ||
Maximum contingent consideration payout period | 8 years | ||
Commodities | |||
Assets: | |||
Derivatives | 6 | 26 | |
Liabilities: | |||
Derivatives | 13 | 2 | |
Foreign currencies | |||
Assets: | |||
Derivatives | 1 | ||
Liabilities: | |||
Derivatives | 1 | 10 | |
Domestic debt securities | |||
Assets: | |||
Trading securities | 472 | 399 | |
Domestic equity securities | |||
Assets: | |||
Trading securities | 361 | 433 | |
Foreign equity securities | |||
Assets: | |||
Trading securities | 174 | 169 | |
Money market funds held in trading accounts | |||
Assets: | |||
Trading securities | 117 | 12 | |
Foreign debt securities | |||
Assets: | |||
Trading securities | 98 | 66 | |
Other trading securities | |||
Assets: | |||
Trading securities | 3 | 7 | |
Recurring basis | Level 1 | |||
Assets: | |||
Derivatives | 4 | 26 | |
Total assets | 855 | 827 | |
Liabilities: | |||
Derivatives | 13 | 2 | |
Total liabilities | 13 | 2 | |
Recurring basis | Level 1 | Other current assets | |||
Assets: | |||
Trading securities | 28 | 25 | |
Recurring basis | Level 1 | Domestic debt securities | Short-term investments. | |||
Assets: | |||
Trading securities | 171 | 162 | |
Recurring basis | Level 1 | Domestic equity securities | Short-term investments. | |||
Assets: | |||
Trading securities | 361 | 433 | |
Recurring basis | Level 1 | Foreign equity securities | Short-term investments. | |||
Assets: | |||
Trading securities | 174 | 169 | |
Recurring basis | Level 1 | Money market funds held in trading accounts | Short-term investments. | |||
Assets: | |||
Trading securities | 117 | 12 | |
Recurring basis | Level 2 | |||
Assets: | |||
Derivatives | 3 | ||
Total assets | 469 | 374 | |
Liabilities: | |||
Derivatives | 1 | 10 | |
Total liabilities | 1 | 10 | |
Recurring basis | Level 2 | Other current assets | |||
Assets: | |||
Trading securities | 1 | 1 | |
Recurring basis | Level 2 | Business Development Company | |||
Assets: | |||
Long-term investment | 63 | 63 | |
Recurring basis | Level 2 | Domestic debt securities | Short-term investments. | |||
Assets: | |||
Trading securities | 301 | 237 | |
Recurring basis | Level 2 | Foreign debt securities | Short-term investments. | |||
Assets: | |||
Trading securities | 98 | 66 | |
Recurring basis | Level 2 | Other trading securities | Short-term investments. | |||
Assets: | |||
Trading securities | 3 | 7 | |
Recurring basis | Level 3 | |||
Liabilities: | |||
Contingent consideration | 25 | 19 | |
Total liabilities | 25 | 19 | |
Recurring basis | Fair Value | |||
Assets: | |||
Derivatives | 7 | 26 | |
Total assets | 1,324 | 1,201 | |
Liabilities: | |||
Contingent consideration | 25 | 19 | |
Derivatives | 14 | 12 | |
Total liabilities | 39 | 31 | |
Recurring basis | Fair Value | Other current assets | |||
Assets: | |||
Trading securities | 29 | 26 | |
Recurring basis | Fair Value | Business Development Company | |||
Assets: | |||
Long-term investment | 63 | 63 | |
Recurring basis | Fair Value | Domestic debt securities | Short-term investments. | |||
Assets: | |||
Trading securities | 472 | 399 | |
Recurring basis | Fair Value | Domestic equity securities | Short-term investments. | |||
Assets: | |||
Trading securities | 361 | 433 | |
Recurring basis | Fair Value | Foreign equity securities | Short-term investments. | |||
Assets: | |||
Trading securities | 174 | 169 | |
Recurring basis | Fair Value | Money market funds held in trading accounts | Short-term investments. | |||
Assets: | |||
Trading securities | 117 | 12 | |
Recurring basis | Fair Value | Foreign debt securities | Short-term investments. | |||
Assets: | |||
Trading securities | 98 | 66 | |
Recurring basis | Fair Value | Other trading securities | Short-term investments. | |||
Assets: | |||
Trading securities | $ 3 | $ 7 |
Derivatives and Fair Value of_4
Derivatives and Fair Value of Financial Instruments-Derivatives (Details) lb in Millions, bu in Millions, $ in Millions | 6 Months Ended | 12 Months Ended |
Jul. 01, 2023 USD ($) lb bu | Dec. 31, 2022 USD ($) lb bu | |
Grain | ||
Derivative commodity instruments | ||
Nonmonetary notional amount | bu | 23 | 8 |
Hogs | ||
Derivative commodity instruments | ||
Nonmonetary notional amount | 115 | 16 |
Soybean oil | ||
Derivative commodity instruments | ||
Nonmonetary notional amount | lb | 92 | 26 |
Foreign currencies | ||
Derivative commodity instruments | ||
Notional amounts | $ 8 | $ 190 |
Derivatives and Fair Value of_5
Derivatives and Fair Value of Financial Instruments-Derivatives Fair Value (Details) - USD ($) $ in Millions | Jul. 01, 2023 | Dec. 31, 2022 |
Commodities | ||
Fair value of each type of derivative | ||
Asset Derivatives | $ 6 | $ 26 |
Derivative Asset, Statement of Financial Position [Extensible Enumeration] | Other Assets, Current | Other Assets, Current |
Liability Derivatives | $ 13 | $ 2 |
Derivative Liability, Statement of Financial Position [Extensible Enumeration] | Other Liabilities, Current | Other Liabilities, Current |
Margin account | $ 50 | $ 3 |
Commodities | Other current assets | ||
Fair value of each type of derivative | ||
Derivative assets and liabilities, net basis | 43 | 27 |
Foreign currencies | ||
Fair value of each type of derivative | ||
Asset Derivatives | $ 1 | |
Derivative Asset, Statement of Financial Position [Extensible Enumeration] | Other Assets, Current | |
Liability Derivatives | $ 1 | $ 10 |
Derivative Liability, Statement of Financial Position [Extensible Enumeration] | Other Liabilities, Current | Other Liabilities, Current |
Derivatives and Fair Value of_6
Derivatives and Fair Value of Financial Instruments-Counterparty Risk (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jul. 01, 2023 | Jul. 02, 2022 | Jul. 01, 2023 | Jul. 02, 2022 | |
Derivatives | ||||
Credit risk associated with derivative contracts | $ 1 | |||
Commodities | ||||
Derivatives | ||||
Gains (losses) on derivatives | $ (22) | $ (30) | $ (25) | $ (58) |
Derivative, Gain (Loss), Statement of Income or Comprehensive Income [Extensible Enumeration] | Cost of Goods and Services Sold | Cost of Goods and Services Sold | Cost of Goods and Services Sold | Cost of Goods and Services Sold |
Foreign currencies | Cost of sales | ||||
Derivatives | ||||
Gains (losses) on derivatives | $ (1) | $ (5) | $ 2 | $ (6) |
Derivative, Gain (Loss), Statement of Income or Comprehensive Income [Extensible Enumeration] | Cost of Goods and Services Sold | Cost of Goods and Services Sold | Cost of Goods and Services Sold | Cost of Goods and Services Sold |
Foreign currencies | Foreign currency gains (losses), net | ||||
Derivatives | ||||
Gains (losses) on derivatives | $ (2) | $ 8 | $ (4) | $ 9 |
Derivative, Gain (Loss), Statement of Income or Comprehensive Income [Extensible Enumeration] | Foreign Currency Transaction Gain (Loss), before Tax | Foreign Currency Transaction Gain (Loss), before Tax | Foreign Currency Transaction Gain (Loss), before Tax | Foreign Currency Transaction Gain (Loss), before Tax |
Stockholders' Equity and Accu_2
Stockholders' Equity and Accumulated Other Comprehensive Loss (Details) - USD ($) $ in Millions | 3 Months Ended | |||
Jul. 01, 2023 | Apr. 01, 2023 | Jul. 02, 2022 | Apr. 02, 2022 | |
Components of and changes in accumulated other comprehensive loss, net of tax | ||||
Balance at beginning of the period | $ (408) | $ (422) | $ (433) | $ (432) |
Other comprehensive income (loss) before reclassifications | 3 | 13 | (2) | (11) |
Amounts reclassified from AOCL to net earnings | 1 | 1 | 10 | |
Other comprehensive income (loss), net of tax | 3 | 14 | (1) | (1) |
Balance at end of the period | (405) | (408) | (434) | (433) |
Cumulative Foreign Currency Translation Adjustment | ||||
Components of and changes in accumulated other comprehensive loss, net of tax | ||||
Balance at beginning of the period | (389) | (401) | (369) | (368) |
Other comprehensive income (loss) before reclassifications | 1 | 12 | (2) | (10) |
Amounts reclassified from AOCL to net earnings | 9 | |||
Other comprehensive income (loss), net of tax | 1 | 12 | (2) | (1) |
Balance at end of the period | (388) | (389) | (371) | (369) |
Cumulative Unrecognized Pension Cost | ||||
Components of and changes in accumulated other comprehensive loss, net of tax | ||||
Balance at beginning of the period | (19) | (21) | (64) | (64) |
Other comprehensive income (loss) before reclassifications | 2 | 1 | (1) | |
Amounts reclassified from AOCL to net earnings | 1 | 1 | 1 | |
Other comprehensive income (loss), net of tax | 2 | 2 | 1 | |
Balance at end of the period | $ (17) | $ (19) | $ (63) | $ (64) |
Segment Information - Disaggreg
Segment Information - Disaggregation of sales (Details) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jul. 01, 2023 USD ($) | Jul. 02, 2022 USD ($) | Jul. 01, 2023 USD ($) segment | Jul. 02, 2022 USD ($) | |
Revenue Recognition | ||||
Number of reportable segments | segment | 6 | |||
Net sales | $ 2,393 | $ 2,973 | $ 4,892 | $ 5,682 |
Products | ||||
Revenue Recognition | ||||
Net sales | 1,957 | 2,388 | 3,941 | 4,602 |
Other | ||||
Revenue Recognition | ||||
Net sales | 63 | 47 | 115 | 65 |
Pork | ||||
Revenue Recognition | ||||
Net sales | 595 | 663 | 1,209 | 1,283 |
Pork | Products | ||||
Revenue Recognition | ||||
Net sales | 434 | 513 | 862 | 1,004 |
Pork | Transportation | ||||
Revenue Recognition | ||||
Net sales | 3 | 3 | 6 | 5 |
Pork | Energy | ||||
Revenue Recognition | ||||
Net sales | 149 | 140 | 323 | 261 |
Pork | Other | ||||
Revenue Recognition | ||||
Net sales | 9 | 7 | 18 | 13 |
Commodity Trading and Milling | ||||
Revenue Recognition | ||||
Net sales | 1,335 | 1,711 | 2,679 | 3,281 |
Commodity Trading and Milling | Products | ||||
Revenue Recognition | ||||
Net sales | 1,332 | 1,707 | 2,673 | 3,274 |
Commodity Trading and Milling | Other | ||||
Revenue Recognition | ||||
Net sales | 3 | 4 | 6 | 7 |
Marine | ||||
Revenue Recognition | ||||
Net sales | 356 | 523 | 804 | 989 |
Marine | Transportation | ||||
Revenue Recognition | ||||
Net sales | 356 | 523 | 804 | 989 |
Sugar and Alcohol | ||||
Revenue Recognition | ||||
Net sales | 40 | 24 | 78 | 55 |
Sugar and Alcohol | Products | ||||
Revenue Recognition | ||||
Net sales | 40 | 24 | 78 | 55 |
Power | ||||
Revenue Recognition | ||||
Net sales | 63 | 47 | 115 | 65 |
Power | Energy | ||||
Revenue Recognition | ||||
Net sales | 63 | 47 | 115 | 65 |
All Other | ||||
Revenue Recognition | ||||
Net sales | 4 | 5 | 7 | 9 |
All Other | Products | ||||
Revenue Recognition | ||||
Net sales | 2 | 4 | 5 | 8 |
All Other | Transportation | ||||
Revenue Recognition | ||||
Net sales | 2 | 1 | 2 | 1 |
Segment Totals | ||||
Revenue Recognition | ||||
Net sales | 2,393 | 2,973 | 4,892 | 5,682 |
Segment Totals | Products | ||||
Revenue Recognition | ||||
Net sales | 1,808 | 2,248 | 3,618 | 4,341 |
Segment Totals | Transportation | ||||
Revenue Recognition | ||||
Net sales | 361 | 527 | 812 | 995 |
Segment Totals | Energy | ||||
Revenue Recognition | ||||
Net sales | 212 | 187 | 438 | 326 |
Segment Totals | Other | ||||
Revenue Recognition | ||||
Net sales | $ 12 | $ 11 | $ 24 | $ 20 |
Segment Information - Informati
Segment Information - Information by Segment (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | |||
Jul. 01, 2023 | Jul. 02, 2022 | Jul. 01, 2023 | Jul. 02, 2022 | Dec. 31, 2022 | |
Segment Information | |||||
Operating Income (Loss) | $ (4) | $ 192 | $ (67) | $ 338 | |
Income (loss) from affiliates | 25 | 23 | 51 | 46 | |
Total assets | 7,805 | 7,805 | $ 7,902 | ||
Investment in and Advances to Affiliates | 734 | 734 | 753 | ||
Pork | |||||
Segment Information | |||||
Income (loss) from affiliates | 9 | 7 | 19 | 7 | |
Investment in and Advances to Affiliates | 153 | 153 | 152 | ||
Commodity Trading and Milling | |||||
Segment Information | |||||
Income (loss) from affiliates | (2) | 4 | (10) | 9 | |
Investment in and Advances to Affiliates | 188 | 188 | 210 | ||
Marine | |||||
Segment Information | |||||
Income (loss) from affiliates | 2 | 1 | 1 | 3 | |
Investment in and Advances to Affiliates | 37 | 37 | 36 | ||
Sugar and Alcohol | |||||
Segment Information | |||||
Investment in and Advances to Affiliates | 2 | 2 | 2 | ||
Power | |||||
Segment Information | |||||
Investment in and Advances to Affiliates | 3 | 3 | 3 | ||
Turkey. | |||||
Segment Information | |||||
Income (loss) from affiliates | 16 | 11 | 41 | 27 | |
Investment in and Advances to Affiliates | 351 | 351 | 350 | ||
Segment Totals | |||||
Segment Information | |||||
Operating Income (Loss) | (1) | 193 | (58) | 342 | |
Income (loss) from affiliates | 25 | 23 | 51 | 46 | |
Total assets | 6,194 | 6,194 | 6,358 | ||
Segment Totals | Pork | |||||
Segment Information | |||||
Operating Income (Loss) | (104) | 1 | (316) | 28 | |
Total assets | 2,724 | 2,724 | 2,698 | ||
Segment Totals | Commodity Trading and Milling | |||||
Segment Information | |||||
Operating Income (Loss) | 17 | 30 | 60 | 42 | |
Total assets | 1,805 | 1,805 | 1,915 | ||
Segment Totals | Marine | |||||
Segment Information | |||||
Operating Income (Loss) | 60 | 155 | 156 | 268 | |
Total assets | 800 | 800 | 882 | ||
Segment Totals | Sugar and Alcohol | |||||
Segment Information | |||||
Operating Income (Loss) | 3 | 9 | 2 | ||
Total assets | 164 | 164 | 165 | ||
Segment Totals | Power | |||||
Segment Information | |||||
Operating Income (Loss) | 22 | 6 | 32 | 1 | |
Total assets | 345 | 345 | 342 | ||
Segment Totals | Turkey. | |||||
Segment Information | |||||
Total assets | 351 | 351 | 350 | ||
Segment Totals | All Other | |||||
Segment Information | |||||
Operating Income (Loss) | 1 | 1 | 1 | 1 | |
Total assets | 5 | 5 | 6 | ||
Corporate Items | |||||
Segment Information | |||||
Operating Income (Loss) | (3) | $ (1) | (9) | $ (4) | |
Total assets | $ 1,611 | $ 1,611 | $ 1,544 |
Segment Information - Turkey (D
Segment Information - Turkey (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | |||||
Jul. 01, 2023 | Apr. 01, 2023 | Jul. 02, 2022 | Apr. 02, 2022 | Jul. 01, 2023 | Jul. 02, 2022 | Dec. 31, 2022 | |
Segment Information | |||||||
Total assets | $ 7,805 | $ 7,805 | $ 7,902 | ||||
Net earnings | 52 | $ (16) | $ 108 | $ 104 | 36 | $ 212 | |
Investments in and advances to affiliates | 734 | 734 | 753 | ||||
Turkey. | |||||||
Segment Information | |||||||
Investments in and advances to affiliates | 351 | 351 | 350 | ||||
Turkey. | Butterball, LLC | |||||||
Segment Information | |||||||
Total assets | 1,200 | 1,200 | $ 1,100 | ||||
Net sales | 458 | 417 | 866 | 816 | |||
Operating income | 36 | 27 | 86 | 40 | |||
Net earnings | $ 31 | $ 21 | $ 79 | $ 51 |
Insider Trading Arrangements
Insider Trading Arrangements | 3 Months Ended |
Jul. 01, 2023 | |
Trading Arrangements, by Individual | |
Rule 10b5-1 Arrangement Adopted | false |
Non-Rule 10b5-1 Arrangement Adopted | false |
Rule 10b5-1 Arrangement Terminated | false |
Non-Rule 10b5-1 Arrangement Terminated | false |