Document and Entity Information
Document and Entity Information - shares | 6 Months Ended | |
Jun. 27, 2020 | Jul. 25, 2020 | |
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Period End Date | Jun. 27, 2020 | |
Document Transition Report | false | |
Entity File Number | 1-7685 | |
Entity Registrant Name | AVERY DENNISON CORPORATION | |
Entity Incorporation, State or Country Code | DE | |
Entity Tax Identification Number | 95-1492269 | |
Entity Address, Address Line One | 207 Goode Avenue | |
Entity Address, City or Town | Glendale | |
Entity Address, State or Province | CA | |
Entity Address, Postal Zip Code | 91203 | |
City Area Code | 626 | |
Local Phone Number | 304-2000 | |
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 | 83,462,155 | |
Current Fiscal Year End Date | --01-02 | |
Document Fiscal Year Focus | 2020 | |
Document Fiscal Period Focus | Q2 | |
Entity Central Index Key | 0000008818 | |
Amendment Flag | false | |
Common stock, $1 par value | ||
Title of 12(b) Security | Common stock, $1 par value | |
Trading Symbol | AVY | |
Security Exchange Name | NYSE | |
Senior notes due 2025 at 1.25% | ||
Title of 12(b) Security | 1.25% Senior Notes due 2025 | |
Trading Symbol | AVY25 | |
Security Exchange Name | NYSE |
CONDENSED CONSOLIDATED BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) $ in Millions | Jun. 27, 2020 | Dec. 28, 2019 |
Current assets: | ||
Cash and cash equivalents | $ 262.6 | $ 253.7 |
Trade accounts receivable, less allowances of $46.4 and $27.1 at June 27, 2020 and December 28, 2019, respectively | 1,114.6 | 1,212.2 |
Inventories, net | 726.6 | 663 |
Other current assets | 220.8 | 211.7 |
Total current assets | 2,324.6 | 2,340.6 |
Property, plant and equipment, net | 1,228.8 | 1,210.7 |
Goodwill | 1,039.8 | 930.8 |
Other intangibles resulting from business acquisitions, net | 195.5 | 126.5 |
Deferred tax assets | 211.1 | 225.4 |
Other assets | 651.9 | 654.8 |
Total assets | 5,651.7 | 5,488.8 |
Current liabilities: | ||
Short-term borrowings and current portion of long-term debt and finance leases | 268.6 | 440.2 |
Accounts payable | 956.5 | 1,066.1 |
Accrued payroll and employee benefits | 175.3 | 220.4 |
Other current liabilities | 509.1 | 527.1 |
Total current liabilities | 1,909.5 | 2,253.8 |
Long-term debt and finance leases | 1,997.6 | 1,499.3 |
Long-term retirement benefits and other liabilities | 417.4 | 421.4 |
Deferred tax liabilities and income taxes payable | 113.3 | 110.3 |
Commitments and contingencies (see Note 12) | ||
Shareholders' equity: | ||
Common stock, $1 par value per share, authorized - 400,000,000 shares at June 27, 2020 and December 28, 2019; issued - 124,126,624 shares at June 27, 2020 and December 28, 2019; outstanding - 83,448,042 shares and 83,366,840 shares at June 27, 2020 and December 28, 2019, respectively | 124.1 | 124.1 |
Capital in excess of par value | 840 | 874 |
Retained earnings | 3,100.2 | 2,979.1 |
Treasury stock at cost, 40,678,582 shares and 40,759,784 shares at June 27, 2020 and December 28, 2019, respectively | (2,447.2) | (2,425.1) |
Accumulated other comprehensive loss | (403.2) | (348.1) |
Total shareholders' equity | 1,213.9 | 1,204 |
Total liabilities and shareholders' equity | $ 5,651.7 | $ 5,488.8 |
CONDENSED CONSOLIDATED BALANC_2
CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) $ in Millions | Jun. 27, 2020 | Dec. 28, 2019 |
CONDENSED CONSOLIDATED BALANCE SHEETS | ||
Trade accounts receivable, allowances (in dollars) | $ 46.4 | $ 27.1 |
Common stock, par value (in dollars per share) | $ 1 | $ 1 |
Common stock, authorized shares | 400,000,000 | 400,000,000 |
Common stock, issued shares | 124,126,624 | 124,126,624 |
Common stock, outstanding shares | 83,448,042 | 83,366,840 |
Treasury stock, shares | 40,678,582 | 40,759,784 |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) shares in Millions, $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jun. 27, 2020 | Jun. 29, 2019 | Jun. 27, 2020 | Jun. 29, 2019 | |
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS | ||||
Net sales | $ 1,528.5 | $ 1,795.7 | $ 3,251.5 | $ 3,535.8 |
Cost of products sold | 1,145.6 | 1,313.4 | 2,383.5 | 2,588.1 |
Gross profit | 382.9 | 482.3 | 868 | 947.7 |
Marketing, general and administrative expense | 219.4 | 265.7 | 500.4 | 542 |
Other expense, net | 40 | 7.5 | 44.9 | 15 |
Interest expense | 20 | 19.5 | 38.8 | 39 |
Other non-operating expense, net | 0.2 | 0.9 | (0.3) | 447.4 |
Income (loss) before taxes | 103.3 | 188.7 | 284.2 | (95.7) |
Provision for (benefit from) income taxes | 22.2 | 44.9 | 68.5 | (93.5) |
Equity method investment losses | (1.4) | (0.4) | (1.8) | (1.3) |
Net income (loss) | $ 79.7 | $ 143.4 | $ 213.9 | $ (3.5) |
Per share amounts: | ||||
Net income (loss) per common share (in dollars per share) | $ 0.96 | $ 1.70 | $ 2.56 | $ (0.04) |
Net income (loss) per common share, assuming dilution (in dollars per share) | $ 0.95 | $ 1.69 | $ 2.55 | $ (0.04) |
Weighted average number of shares outstanding: | ||||
Common shares (in shares) | 83.4 | 84.3 | 83.4 | 84.3 |
Common shares, assuming dilution (in shares) | 83.8 | 85.1 | 83.9 | 84.3 |
CONDENSED CONSOLIDATED STATEM_2
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jun. 27, 2020 | Jun. 29, 2019 | Jun. 27, 2020 | Jun. 29, 2019 | |
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME | ||||
Net income (loss) | $ 79.7 | $ 143.4 | $ 213.9 | $ (3.5) |
Other comprehensive income (loss), net of tax: | ||||
Foreign currency translation | 13.6 | (10.5) | (55) | 11.6 |
Pension and other postretirement benefits | 0.7 | 0.2 | 1.3 | 300.9 |
Cash flow hedges | (5.5) | (0.1) | (1.4) | (0.3) |
Other comprehensive income (loss), net of tax | 8.8 | (10.4) | (55.1) | 312.2 |
Total comprehensive income, net of tax | $ 88.5 | $ 133 | $ 158.8 | $ 308.7 |
CONDENSED CONSOLIDATED STATEM_3
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Millions | 6 Months Ended | |
Jun. 27, 2020 | Jun. 29, 2019 | |
Operating Activities | ||
Net income (loss) | $ 213.9 | $ (3.5) |
Adjustments to reconcile net income (loss) to net cash provided by operating activities: | ||
Depreciation | 74.6 | 70.4 |
Amortization | 23.2 | 19 |
Provision for credit losses and sales returns | 38.8 | 26.8 |
Stock-based compensation | 1.4 | 16.5 |
Pension plan settlements and related charges | 446.9 | |
Deferred taxes and other non-cash taxes | 16.4 | (166.6) |
Other non-cash expense and loss (income and gain), net | 16.7 | 10.3 |
Changes in assets and liabilities and other adjustments | (201) | (181) |
Net cash provided by operating activities | 184 | 238.8 |
Investing Activities | ||
Purchases of property, plant and equipment | (63.9) | (79.8) |
Purchases of software and other deferred charges | (11) | (13) |
Proceeds from sales of property, plant and equipment | 0.1 | 7.4 |
Proceeds from insurance and sales (purchases) of investments, net | (0.4) | 4.3 |
Payments for acquisition, net of cash acquired, and investments in businesses | (252.8) | (6.5) |
Net cash used in investing activities | (328) | (87.6) |
Financing Activities | ||
Net increase in borrowings (maturities of three months or less) | 92.5 | 112.9 |
Additional borrowings under revolving credit facility | 500 | |
Repayments of revolving credit facility | (500) | |
Additional long-term borrowings | 493.7 | |
Repayments of long-term debt and finance leases | (267.6) | (16.5) |
Dividends paid | (96.8) | (92.7) |
Share repurchases | (45.2) | (116.6) |
Net (tax withholding) proceeds related to stock-based compensation | (20.5) | (20.4) |
Payments of contingent consideration | (1.6) | |
Net cash provided by (used in) financing activities | 156.1 | (134.9) |
Effect of foreign currency translation on cash balances | (3.2) | (1) |
Increase in cash and cash equivalents | 8.9 | 15.3 |
Cash and cash equivalents, beginning of year | 253.7 | 232 |
Cash and cash equivalents, end of period | $ 262.6 | $ 247.3 |
General
General | 6 Months Ended |
Jun. 27, 2020 | |
General | |
General | Note 1. General The unaudited Condensed Consolidated Financial Statements and notes thereto in this Quarterly Report on Form 10-Q are presented as permitted by Article 10 of Regulation S-X and do not contain certain information included in the audited Consolidated Financial Statements and notes thereto in our 2019 Annual Report on Form 10-K, which should be read in conjunction with this Quarterly Report on Form 10-Q. The accompanying unaudited Condensed Consolidated Financial Statements contain all adjustments of a normal and recurring nature necessary for a fair statement of our interim results. Interim results of operations are not necessarily indicative of future results. We expect the effects of the coronavirus/COVID-19 pandemic (collectively referred to herein as "COVID-19") to adversely impact our financial position, results of operations, and cash flows in fiscal year 2020. The unaudited Condensed Consolidated Financial Statements presented herein reflect our current estimates and assumptions that affect the reported amounts of assets and liabilities and related disclosures as of the date of the financial statements and the reported amounts of sales and expenses during the reporting periods presented. Fiscal Periods The three and six months ended June 27, 2020 and June 29, 2019 consisted of thirteen-week and twenty-six week periods, respectively. Accounting Guidance Updates Credit Losses In the first quarter of 2020, using the modified retrospective approach, we adopted amended accounting guidance that requires credit losses on financial instruments, including trade receivables, to be measured based on the expected credit loss model instead of the incurred loss model. The expected credit loss model requires us to consider forward-looking information to estimate our allowance for credit losses. Our adoption of this guidance did not have a material impact on our financial position, results of operations or cash flows. |
Acquisitions
Acquisitions | 6 Months Ended |
Jun. 27, 2020 | |
Acquisitions | |
Acquisitions | Note 2. Acquisitions On February 28, 2020, we completed the acquisition of Smartrac’s Transponder (RFID Inlay) division ("Smartrac"), a manufacturer of radio-frequency identification (“RFID”) products, for consideration, subject to customary adjustments, of approximately $255 million (€232 million), $4.9 million of which was payable as of June 27, 2020. We believe this acquisition enhances our research and development capabilities, expands product lines, and provides added manufacturing capacity. Consistent with the time allowed to complete our assessment, the valuation of certain acquired assets and liabilities, including intangible assets, environmental liabilities and income taxes, is preliminary. This acquisition was not material to our unaudited Condensed Consolidated Financial Statements. |
Goodwill and Other Intangibles
Goodwill and Other Intangibles Resulting from Business Acquisitions | 6 Months Ended |
Jun. 27, 2020 | |
Goodwill and Other Intangibles Resulting from Business Acquisitions | |
Goodwill and Other Intangibles Resulting from Business Acquisitions | Note 3. Goodwill and Other Intangibles Resulting from Business Acquisitions Changes in the net carrying amount of goodwill for the six months ended June 27, 2020 by reportable segment are shown below. Label and Retail Branding Industrial and Graphic and Information Healthcare (In millions) Materials Solutions Materials Total Goodwill as of December 28, 2019 $ 407.8 $ 349.3 $ 173.7 $ 930.8 Acquisition (1) — 110.5 — 110.5 Translation adjustments (1.7) .7 (.5) (1.5) Goodwill as of June 27, 2020 $ 406.1 $ 460.5 $ 173.2 $ 1,039.8 (1) The duration and severity of COVID-19 could result in future impairment charges to our reportable segments’ goodwill balances. While we have concluded that a triggering event did not occur during the six months ended June 27, 2020, a prolonged pandemic could significantly impact our results of operations and result in changes to assumptions utilized in the determination of the estimated fair values of goodwill that could trigger an impairment. Finite-Lived Intangible Assets In connection with the Smartrac acquisition, we acquired approximately $78 million of identifiable intangible assets, which consisted of customer relationships, trade names and trademarks, and patents and other acquired technology. We utilized the income approach to estimate the fair values of the identifiable intangibles associated with the acquisition, primarily using Level 3 inputs. The discount rate we used to value these assets was 13.5%. The table below summarizes the amounts and useful lives of these intangible assets as of the acquisition date. Amortization Amount period (in millions) (in years) Patents and other acquired technology $ 60.0 11 Customer relationships 16.0 6 Trade names and trademarks 2.0 5 Refer to Note 2, “Acquisitions,” to the unaudited Condensed Consolidated Financial Statements for more information. |
Debt
Debt | 6 Months Ended |
Jun. 27, 2020 | |
Debt | |
Debt | Note 4. Debt In March 2020, we issued $500 million of senior notes, due April 2030. The senior notes bear an interest rate of 2.65% per year, payable semiannually in arrears. Our net proceeds from the offering, after deducting underwriting discounts and offering expenses, were $493.7 million, which we used to repay both existing indebtedness under our commercial paper program used to fund our Smartrac acquisition and the $250 million aggregate principal amount of senior notes that matured in April 2020. In the second quarter of 2020, we also repaid $15 million of medium-term notes that matured in June 2020. The estimated fair value of our long-term debt is primarily based on the credit spread above U.S. Treasury securities or euro government bond securities, as applicable, on notes with similar rates, credit ratings, and remaining maturities. The fair value of short-term borrowings, which include commercial paper issuances and short-term lines of credit, approximates their carrying value given the short duration of these obligations. The fair value of our total debt was $2.43 billion at June 27, 2020 and $2.05 billion at December 28, 2019. Fair values were determined based primarily on Level 2 inputs, which are inputs other than quoted prices in active markets that are either directly or indirectly observable. In February 2020, we amended and restated our $800 million revolving credit facility (the “Revolver”), eliminating one of the financial covenant requirements and extending the maturity date to February 13, 2025. The maturity date may be extended for a one-year period under certain circumstances. The commitments under the Revolver may be increased by up to $400 million, subject to lender approvals and customary requirements. No balance was outstanding under the Revolver as of June 27, 2020 or December 28, 2019. As of both June 27, 2020 and December 28, 2019, we were in compliance with our financial covenants under the Revolver. |
Pension and Other Postretiremen
Pension and Other Postretirement Benefits | 6 Months Ended |
Jun. 27, 2020 | |
Pension and Other Postretirement Benefits. | |
Pension and Other Postretirement Benefits | Note 5. Pension and Other Postretirement Benefits Defined Benefit Plans We sponsor a number of defined benefit plans, the accrual of benefits under some of which has been frozen, covering eligible employees in the U.S. and certain other countries. Benefits payable to an employee are based primarily on years of service and the employee’s compensation during his or her employment with us. For the three months and six months ended June 27, 2020, the net periodic benefit cost related to our U.S. and international plans was not material. For the three months and six months ended June 29, 2019, the combined net periodic benefit cost related to our U.S. and international plans was $2 million and $3.2 million and $449.7 million and $6.5 million, respectively. Included in the net periodic benefit cost for our U.S. plans for the three months ended June 29, 2019 was a loss on settlement of $446.9 million related to the termination of the Avery Dennison Pension Plan (the “ADPP”), a U.S. defined benefit plan. This loss was partially offset by related tax benefits of approximately $179 million. Refer to Note 8, “Taxes Based on Income,” to the unaudited Condensed Consolidated Financial Statements for more information. In connection with the ADPP termination in 2019, we settled approximately $753 million of the plan's liabilities by entering into an agreement to purchase annuities primarily from American General Life Insurance Company and through a combination of annuities and direct funding to the Pension Benefit Guaranty Corporation for a small portion of former employees and their beneficiaries. Service cost and components of net periodic benefit cost (credit) other than service cost were included in “Marketing, general and administrative expense” and “Other non-operating expense” in the unaudited Condensed Consolidated Statements of Operations, respectively. We are also obligated to pay unfunded termination indemnity benefits to certain employees outside of the U.S., which are subject to applicable agreements, laws and regulations. We have not incurred significant costs related to these benefits. |
Cost Reduction Actions
Cost Reduction Actions | 6 Months Ended |
Jun. 27, 2020 | |
Cost Reduction Actions | |
Cost Reduction Actions | Note 6. Cost Reduction Actions 2019/2020 Actions During the six months ended June 27, 2020, we recorded $41.9 million in restructuring charges related to our 2019/2020 actions. These charges consisted of severance and related costs for the reduction of approximately 1,750 positions from numerous locations across our company, which primarily included actions in our LGM and RBIS reportable segments. The actions in LGM were primarily associated with the consolidation of our graphics business in Europe, partially in response to COVID-19. The actions in RBIS were primarily related to global headcount and footprint reduction, with some actions accelerated and expanded in response to COVID-19. 2018/2019 Actions During the six months ended June 27, 2020, we recorded $.2 million in net restructuring reversals related to our 2018/2019 actions. During the six months ended June 27, 2020, restructuring charges and payments were as follows: Charges, Foreign Accrual at Net of Cash Non-cash Currency Accrual at (In millions) December 28, 2019 Reversals Payments Impairment Translation June 27, 2020 2019/2020 Actions Severance and related costs $ 21.9 $ 40.2 $ (17.8) $ — $ .5 $ 44.8 Asset impairment — 1.7 — (1.7) — — 2018/2019 Actions Severance and related costs 6.5 (.2) (6.2) — .1 .2 Lease cancellation costs .3 — — — — .3 Total $ 28.7 $ 41.7 $ (24.0) $ (1.7) $ .6 $ 45.3 Accruals for severance and related costs and lease cancellation costs were included in “Other current liabilities” in the unaudited Condensed Consolidated Balance Sheets. Asset impairment charges were based on the estimated market value of the assets, less selling costs, if applicable. Restructuring charges were included in “Other expense, net” in the unaudited Condensed Consolidated Statements of Operations. The table below shows the total amount of restructuring charges, net of reversals, incurred by reportable segment. Three Months Ended Six Months Ended (In millions) June 27, 2020 June 29, 2019 June 27, 2020 June 29, 2019 Restructuring charges, net of reversals, by reportable segment Label and Graphic Materials $ 25.8 $ 4.4 $ 26.2 $ 12.7 Retail Branding and Information Solutions 12.2 1.7 13.7 2.2 Industrial and Healthcare Materials 1.5 1.4 2.0 3.3 Corporate (.2) — (.2) — Total $ 39.3 $ 7.5 $ 41.7 $ 18.2 |
Financial Instruments
Financial Instruments | 6 Months Ended |
Jun. 27, 2020 | |
Financial Instruments | |
Financial Instruments | Note 7. Financial Instruments We enter into foreign exchange hedge contracts to reduce our risk from foreign exchange rate fluctuations associated with receivables, payables, loans and firm commitments denominated in certain foreign currencies that arise primarily as a result of our operations outside the U.S. We also enter into futures contracts to hedge certain price fluctuations for a portion of our anticipated domestic purchases of natural gas. The impacts of these foreign exchange and commodities hedge activities on our unaudited Condensed Consolidated Financial Statements were not significant. Following our Smartrac acquisition and our issuance of the March 2020 senior notes, we entered into U.S. dollar to euro cross-currency swap contracts with a total notional amount of $250 million to have an effect of converting fixed-rate U.S. dollar-denominated debt to euro-denominated debt, including semiannual interest payments and the payment of principal at maturity. During the term of the contract, which ends on April 30, 2030, we pay fixed-rate interest in euros and receive fixed-rate interest in U.S. dollars. These contracts have been designated as cash flow hedges. The fair value of these contracts as of June 27, 2020 was $(3) million and was included in “Long-term retirement benefits and other liabilities” in the unaudited Condensed Consolidated Balance Sheets. Refer to Note 11, “Fair Value Measurements,” to the unaudited Condensed Consolidated Financial Statements for more information. |
Taxes Based on Income
Taxes Based on Income | 6 Months Ended |
Jun. 27, 2020 | |
Taxes Based on Income | |
Taxes Based on Income | Note 8. Taxes Based on Income The following table summarizes our income (loss) before taxes, provision for (benefit from) income taxes, and effective tax rate: Three Months Ended Six Months Ended (Dollars in millions) June 27, 2020 June 29, 2019 June 27, 2020 June 29, 2019 Income (loss) before taxes $ 103.3 $ 188.7 $ 284.2 $ (95.7) Provision for (benefit from) income taxes 22.2 44.9 68.5 (93.5) Effective tax rate 21.5 % 23.8 % 24.1 % 97.7 % Our provision for income taxes for the three and six months ended June 27, 2020 included $3.3 million and $10.5 million, respectively, of net tax charge related to the tax on global intangible low-taxed income (“GILTI”) of our foreign subsidiaries and the recognition of foreign withholding taxes on current year earnings, partially offset by the benefit from foreign-derived intangible income (“FDII”). Our provisions for income taxes for the three and six months ended June 27, 2020 also included $11.8 million of net discrete tax benefit primarily from decreases in certain tax reserves, including associated interest and penalties, as a result of closing tax years and effective settlements of certain foreign tax audits. Additionally, our provision for income taxes for the six months ended June 27, 2020 primarily reflected $2.8 million of tax benefit related to excess tax benefits associated with stock-based payments. Our provisions for income taxes for the three and six months ended June 27, 2020 were not materially affected by COVID-19. Moreover, our ability to generate sufficient taxable income was not adversely affected in certain jurisdictions where a significant portion of our net deferred tax assets is concentrated. Our provisions for income taxes for the three and six months ended June 27, 2020 were not materially impacted by the stimulus packages and subsequent interpretations enacted in the U.S. and other countries to provide economic relief to businesses in response to COVID-19. Our provision for (benefit from) income taxes for the three and six months ended June 29, 2019 included $4.9 million and $10.3 million, respectively, of net tax charge related to the tax on GILTI of our foreign subsidiaries and the recognition of foreign withholding taxes on current year earnings, partially offset by the benefit from FDII. Effective in 2019, we implemented certain structural changes to better align with our operational strategies, one benefit of which was to reduce our base erosion payments below the statutory minimum threshold. As a result, our benefits from income taxes for the three and six months ended June 29, 2019 did not include tax charges related to Base Erosion Anti-Abuse Tax. Our benefit from income taxes for the six months ended June 29, 2019 also primarily reflected the following discrete items: (i) $6.8 million of tax benefit related to excess tax benefits associated with stock-based payments; (ii) $11.5 million of tax benefit from decreases in certain tax reserves, including interest and penalties, as a result of closing tax years; and (iii) approximately $179 million of tax benefit related to the effective settlement of the ADPP, $102 million of which was the related tax effect on the pretax charge of $446.9 million and $77 million of which was related to the release of stranded tax effects in “Accumulated other comprehensive income” through the income statement. The tax effects were stranded primarily as a result of the U.S. federal tax rate change under the U.S. Tax Cuts and Jobs Act. Refer to Note 5, “Pension and Other Postretirement Benefits,” to the unaudited Condensed Consolidated Financial Statements for more information on the termination of the ADPP. The amount of income taxes we pay is subject to ongoing audits by taxing jurisdictions around the world. Our estimate of the potential outcome of any uncertain tax issue is subject to our assessment of the relevant risks, facts, and circumstances existing at the time. We believe that we have adequately provided for reasonably foreseeable outcomes related to these matters. However, our future results may include favorable or unfavorable adjustments to our estimated tax liabilities in the period the assessments are made or resolved, which may impact our effective tax rate. The final determination of tax audits and any related legal proceedings could materially differ from amounts reflected in our tax provision and the related liabilities. To date, we and our U.S. subsidiaries have completed the IRS’ Compliance Assurance Process Program through 2017. With limited exceptions, we are no longer subject to income tax examinations by tax authorities for years prior to 2010. During the second quarter of 2020, we became aware of a foreign withholding tax regime that could be interpreted to subject us to withholding tax compliance requirements on certain cross-border intellectual property transactions for years remaining open under the applicable statutes of limitations. We continue to evaluate whether this foreign withholding tax regime would apply to us based on its recent interpretation and relevant tax treaties and considering our facts and circumstances. We currently do not expect that our exposure, if any, will have a material impact on our financial position, results of operations or cash flows. On July 20, 2020, the U.S. Department of Treasury released final regulations that provide certain U.S. taxpayers with an annual election to exclude foreign income that is subject to a high effective tax rate from their GILTI inclusions. The final regulations apply beginning with our 2021 tax year with an option to retroactively apply them to our 2018 through 2020 tax years. Due to the timing of the release and the complexities involved in evaluating the available options, we cannot reasonably estimate the impact of the final regulations at this time. It is reasonably possible that, during the next 12 months, we may realize a decrease in our uncertain tax positions, including interest and penalties, of approximately $10 million, primarily as a result of audit settlements and closing tax years. |
Net Income (Loss) Per Common Sh
Net Income (Loss) Per Common Share | 6 Months Ended |
Jun. 27, 2020 | |
Net Income (Loss) Per Common Share | |
Net Income (Loss) Per Common Share | Note 9. Net Income (Loss) Per Common Share Net income (loss) per common share was computed as follows: Three Months Ended Six Months Ended (In millions, except per share amounts) June 27, 2020 June 29, 2019 June 27, 2020 June 29, 2019 (A) Net income (loss) available to common shareholders $ 79.7 $ 143.4 $ 213.9 $ (3.5) (B) Weighted average number of common shares outstanding 83.4 84.3 83.4 84.3 Dilutive shares (additional common shares issuable under stock-based awards) .4 .8 .5 — (C) Weighted average number of common shares outstanding, assuming dilution 83.8 85.1 83.9 84.3 Net income (loss) per common share: (A) ÷ (B) $ .96 $ 1.70 $ 2.56 $ (.04) Net income (loss) per common share, assuming dilution: (A) ÷ (C) $ .95 $ 1.69 $ 2.55 $ (.04) Certain stock-based compensation awards were not included in the computation of net income (loss) per common share, assuming dilution, because they would not have had a dilutive effect. Stock-based compensation awards excluded from the computation were not significant for the three and six months ended June 27, 2020 or June 29, 2019. For the six months ended June 29, 2019, the effect of dilutive shares (additional common shares issuable under stock-based awards) was not included in the computation of net loss per common share, assuming dilution, because we had a net loss. We excluded 1.0 million shares related to stock-based compensation awards from the computation for the six months ended June 29, 2019. |
Supplemental Equity and Compreh
Supplemental Equity and Comprehensive Income Information | 6 Months Ended |
Jun. 27, 2020 | |
Supplemental Equity and Comprehensive Income Information | |
Supplemental Equity and Comprehensive Income Information | Note 10. Supplemental Equity and Comprehensive Income Information Consolidated Changes in Shareholders’ Equity Three Months Ended Six Months Ended (In millions) June 27, 2020 June 29, 2019 June 27, 2020 June 29, 2019 Common stock issued, $1 par value per share $ 124.1 $ 124.1 $ 124.1 $ 124.1 Capital in excess of par value Beginning balance $ 852.5 $ 851.5 $ 874.0 $ 872.0 Issuance of shares under stock-based compensation plans (1) (12.5) 6.2 (34.0) (14.3) Ending balance $ 840.0 $ 857.7 $ 840.0 $ 857.7 Retained earnings Beginning balance $ 3,064.8 $ 2,663.5 $ 2,979.1 $ 2,864.9 Net income (loss) 79.7 143.4 213.9 (3.5) Issuance of shares under stock-based compensation plans (1) .9 .9 (3.3) (13.4) Contribution of shares to 401(k) Plan (1) 3.2 3.3 7.3 7.0 Dividends (48.4) (48.8) (96.8) (92.7) Ending balance $ 3,100.2 $ 2,762.3 $ 3,100.2 $ 2,762.3 Treasury stock at cost Beginning balance $ (2,456.0) $ (2,287.8) $ (2,425.1) $ (2,223.9) Repurchase of shares for treasury — (27.9) (45.2) (116.6) Issuance of shares under stock-based compensation plans (1) 6.6 1.8 18.6 24.1 Contribution of shares to 401(k) Plan (1) 2.2 2.1 4.5 4.6 Ending balance $ (2,447.2) $ (2,311.8) $ (2,447.2) $ (2,311.8) Accumulated other comprehensive loss Beginning balance $ (412.0) $ (359.4) $ (348.1) $ (682.0) Other comprehensive income (loss), net of tax (2) 8.8 (10.4) (55.1) 312.2 Ending balance $ (403.2) $ (369.8) $ (403.2) $ (369.8) (1) (2) Dividends per common share were as follows: Three Months Ended Six Months Ended June 27, 2020 June 29, 2019 June 27, 2020 June 29, 2019 Dividends per common share $ .58 $ .58 $ 1.16 $ 1.10 Changes in Accumulated Other Comprehensive Loss The changes in “Accumulated other comprehensive loss” (net of tax) for the six-month period ended June 27, 2020 were as follows: Pension and Foreign Other Currency Postretirement Cash Flow (In millions) Translation Benefits Hedges Total Balance as of December 28, 2019 $ (245.1) $ (101.8) $ (1.2) $ (348.1) Other comprehensive loss before reclassifications, net of tax (55.0) — (1.5) (56.5) Reclassifications to net income, net of tax — 1.3 .1 1.4 Net current-period other comprehensive (loss) income, net of tax (55.0) 1.3 (1.4) (55.1) Balance as of June 27, 2020 $ (300.1) $ (100.5) $ (2.6) $ (403.2) The changes in “Accumulated other comprehensive loss” (net of tax) for the six-month period ended June 29, 2019 were as follows: Pension and Foreign Other Currency Postretirement Cash Flow (In millions) Translation Benefits Hedges Total Balance as of December 29, 2018 $ (247.4) $ (434.3) $ (.3) $ (682.0) Other comprehensive income before reclassifications, net of tax (1) 11.6 36.0 .3 47.9 Reclassifications to net loss, net of tax (2) — 264.9 (.6) 264.3 Net current-period other comprehensive income (loss), net of tax 11.6 300.9 (.3) 312.2 Balance as of June 29, 2019 $ (235.8) $ (133.4) $ (.6) $ (369.8) (1) (2) |
Fair Value Measurements
Fair Value Measurements | 6 Months Ended |
Jun. 27, 2020 | |
Fair Value Measurements | |
Fair Value Measurements | Note 11. Fair Value Measurements Recurring Fair Value Measurements The following table provides the assets and liabilities carried at fair value, measured on a recurring basis, as of June 27, 2020: Fair Value Measurements Using Significant Significant Quoted Prices Other Other in Active Observable Unobservable Markets Inputs Inputs (In millions) Total (Level 1) (Level 2) (Level 3) Assets Trading securities $ 31.6 $ 25.7 $ 5.9 $ — Derivative assets 7.3 — 7.3 — Bank drafts 25.6 25.6 — — Liabilities Derivative liabilities $ 13.0 $ .3 $ 12.7 $ — The following table provides the assets and liabilities carried at fair value, measured on a recurring basis, as of December 28, 2019: Fair Value Measurements Using Significant Significant Quoted Prices Other Other in Active Observable Unobservable Markets Inputs Inputs (In millions) Total (Level 1) (Level 2) (Level 3) Assets Trading securities $ 30.6 $ 26.0 $ 4.6 $ — Derivative assets 5.2 — 5.2 — Bank drafts 21.3 21.3 — — Liabilities Derivative liabilities $ 6.0 $ .4 $ 5.6 $ — Trading securities include fixed income securities (primarily U.S. government and corporate debt securities) measured at fair value using quoted prices/bids and a money market fund measured at fair value using net asset value. As of June 27, 2020, trading securities of $.6 million and $31 million were included in “Cash and cash equivalents” and “Other current assets,” respectively, in the unaudited Condensed Consolidated Balance Sheets. As of December 28, 2019, trading securities of $.4 million and $30.2 million were included in “Cash and cash equivalents” and “Other current assets,” respectively, in the unaudited Condensed Consolidated Balance Sheets. Derivatives that are exchange-traded are measured at fair value using quoted market prices and classified within Level 1 of the valuation hierarchy. Derivatives measured based on foreign exchange rate inputs that are readily available in public markets are classified within Level 2 of the valuation hierarchy. Bank drafts (maturities greater than three months) are valued at face value due to their short-term nature and were included in “Other current assets” in the unaudited Condensed Consolidated Balance Sheets. |
Commitments and Contingencies
Commitments and Contingencies | 6 Months Ended |
Jun. 27, 2020 | |
Commitments and Contingencies | |
Commitments and Contingencies | Note 12. Commitments and Contingencies Legal Proceedings We are involved in various lawsuits, claims, inquiries, and other regulatory and compliance matters, most of which are routine to the nature of our business. When it is probable that a loss will be incurred and where a range of the loss can be reasonably estimated, the best estimate within the range is accrued. When the best estimate within the range cannot be determined, the low end of the range is accrued. The ultimate resolution of these claims could affect future results of operations should our exposure be materially different from our estimates or should liabilities be incurred that were not previously accrued. Potential insurance reimbursements are not offset against potential liabilities. Because of the uncertainties associated with claims resolution and litigation, future expenses to resolve these matters could be higher than the liabilities we have accrued; however, we are unable to reasonably estimate a range of potential expenses. If information were to become available that allowed us to reasonably estimate a range of potential expenses in an amount higher or lower than what we have accrued, we would adjust our accrued liabilities accordingly. Additional lawsuits, claims, inquiries, and other regulatory and compliance matters could arise in the future. The range of expenses for resolving any future matters would be assessed as they arise; until then, a range of potential expenses for such resolution cannot be determined. Based upon current information, we believe that the impact of the resolution of these matters would not be, individually or in the aggregate, material to our financial position, results of operations or cash flows. Environmental Expenditures Environmental expenditures are generally expensed. However, environmental expenditures for newly acquired assets and those that extend or improve the economic useful life of existing assets are capitalized and amortized over the shorter of the estimated useful life of the acquired asset or the remaining life of the existing asset. We review our estimates of the costs of complying with environmental laws related to remediation and cleanup of various sites, including sites in which governmental agencies have designated us as a potentially responsible party (“PRP”). When it is probable that a loss will be incurred and where a range of the loss can be reasonably estimated, the best estimate within the range is accrued. When the best estimate within the range cannot be determined, the low end of the range is accrued. Potential insurance reimbursements are not offset against potential liabilities. As of June 27, 2020, we have been designated by the U.S. Environmental Protection Agency (“EPA”) and/or other responsible state agencies as a PRP at twelve waste disposal or waste recycling sites that are the subject of separate investigations or proceedings concerning alleged soil and/or groundwater contamination. No settlement of our liability related to any of these sites has been agreed upon. We are participating with other PRPs at these sites and anticipate that our share of remediation costs will be determined pursuant to agreements that we negotiate with the EPA or other governmental authorities. These estimates could change as a result of changes in planned remedial actions, remediation technologies, site conditions, the estimated time to complete remediation, environmental laws and regulations, and other factors. Because of the uncertainties associated with environmental assessment and remediation activities, our future expenses to remediate these sites could be higher than the liabilities we have accrued; however, we are unable to reasonably estimate a range of potential expenses. If information were to become available that allowed us to reasonably estimate a range of potential expenses in an amount higher or lower than what we have accrued, we would adjust our environmental liabilities accordingly. In addition, we may be identified as a PRP at additional sites in the future. The range of expenses for remediation of any future-identified sites would be addressed as they arise; until then, a range of expenses for such remediation cannot be determined. The activity related to our environmental liabilities for the six months ended June 27, 2020 was as follows: (In millions) Balance at December 28, 2019 $ 21.4 Charges, net of reversals .8 Payments (2.4) Balance at June 27, 2020 $ 19.8 Approximately $9 million and $10 million, respectively, of the balance was classified as short-term and included in “Other current liabilities” in the unaudited Condensed Consolidated Balance Sheets as of June 27, 2020 and December 28, 2019. |
Segment and Disaggregated Reven
Segment and Disaggregated Revenue Information | 6 Months Ended |
Jun. 27, 2020 | |
Segment and Disaggregated Revenue Information | |
Segment and Disaggregated Revenue Information | Note 13. Segment and Disaggregated Revenue Information Disaggregated Revenue Information Disaggregated revenue information is shown below in the manner that best depicts how the nature, amount, timing and uncertainty of our revenue and cash flows are affected by economic factors. Revenue from our LGM reportable segment is attributed to geographic areas based on the location from which products are shipped. Revenue from our RBIS reportable segment is shown by product group. Three Months Ended Six Months Ended (In millions) June 27, 2020 June 29, 2019 June 27, 2020 June 29, 2019 Net sales to unaffiliated customers Label and Graphic Materials: U.S. (1) $ 315.1 $ 320.1 $ 643.2 $ 631.8 Europe (1) 422.3 452.2 867.6 902.1 Asia (1) 230.7 267.1 472.0 523.3 Latin America 70.9 94.4 161.1 185.0 Other international 62.5 72.5 131.1 142.4 Total Label and Graphic Materials (1) 1,101.5 1,206.3 2,275.0 2,384.6 Retail Branding and Information Solutions: Apparel (1) 255.0 370.4 613.6 723.5 Printer Solutions 39.9 47.9 83.2 93.1 Total Retail Branding and Information Solutions (1) 294.9 418.3 696.8 816.6 Industrial and Healthcare Materials 132.1 171.1 279.7 334.6 Net sales to unaffiliated customers $ 1,528.5 $ 1,795.7 $ 3,251.5 $ 3,535.8 (1) Additional Segment Information Additional financial information by reportable segment is shown below. Three Months Ended Six Months Ended (In millions) June 27, 2020 June 29, 2019 June 27, 2020 June 29, 2019 Intersegment sales Label and Graphic Materials $ 12.9 $ 20.1 $ 35.3 $ 41.3 Retail Branding and Information Solutions 5.6 5.0 12.1 9.2 Industrial and Healthcare Materials 1.2 2.9 2.8 5.5 Intersegment sales $ 19.7 $ 28.0 $ 50.2 $ 56.0 Income (loss) before taxes Label and Graphic Materials (1) $ 137.5 $ 162.1 $ 310.0 $ 301.6 Retail Branding and Information Solutions (1) (10.7) 50.4 20.2 101.8 Industrial and Healthcare Materials 7.5 16.5 22.4 30.1 Corporate expense (10.8) (19.9) (29.9) (42.8) Interest expense (20.0) (19.5) (38.8) (39.0) Other non-operating expense, net (.2) (.9) .3 (447.4) Income (loss) before taxes $ 103.3 $ 188.7 $ 284.2 $ (95.7) Other expense, net by reportable segment Label and Graphic Materials (1) $ 25.8 $ 4.4 $ 26.9 $ 12.0 Retail Branding and Information Solutions (1) 12.9 1.7 16.2 (.3) Industrial and Healthcare Materials 1.5 1.4 2.0 3.3 Corporate (.2) — (.2) — Other expense, net $ 40.0 $ 7.5 $ 44.9 $ 15.0 Other expense, net by type Restructuring charges: Severance and related costs $ 37.5 $ 6.1 $ 39.9 $ 16.5 Asset impairment charges and lease cancellation costs 1.8 1.4 1.8 1.7 Other items: Transaction and related costs .7 — 3.2 — Gain on sales of assets — — — (3.2) Other expense, net $ 40.0 $ 7.5 $ 44.9 $ 15.0 (1) |
Supplemental Financial Informat
Supplemental Financial Information | 6 Months Ended |
Jun. 27, 2020 | |
Supplemental Financial Information | |
Supplemental Financial Information | Note 14. Supplemental Financial Information Inventories Net inventories consisted of the following: (In millions) June 27, 2020 December 28, 2019 Raw materials $ 279.0 $ 231.6 Work-in-progress 202.3 201.0 Finished goods 245.3 230.4 Inventories, net $ 726.6 $ 663.0 Property, Plant and Equipment (In millions) June 27, 2020 December 28, 2019 Property, plant and equipment $ 3,235.7 $ 3,171.6 Accumulated depreciation (2,006.9) (1,960.9) Property, plant and equipment, net $ 1,228.8 $ 1,210.7 Allowance for Credit Losses Given the short-term nature of trade receivables, our allowance for credit losses is based on the financial condition of customers, the aging of receivable balances, our historical collection experience, and current and expected future macroeconomic and market conditions, including as a result of COVID-19. Balances are written off in the period in which they are determined to be uncollectible. The activity for the six months ended June 27, 2020 related to our allowance for credit losses was as follows: (In millions) Balance at December 28, 2019 $ 27.1 Provision for credit losses (1) 20.6 Amounts written off (1.4) Other, including foreign currency translation .1 Balance at June 27, 2020 $ 46.4 (1) |
General (Policies)
General (Policies) | 6 Months Ended |
Jun. 27, 2020 | |
General | |
Fiscal Periods | Fiscal Periods The three and six months ended June 27, 2020 and June 29, 2019 consisted of thirteen-week and twenty-six week periods, respectively. |
Accounting Guidance Updates | Accounting Guidance Updates Credit Losses In the first quarter of 2020, using the modified retrospective approach, we adopted amended accounting guidance that requires credit losses on financial instruments, including trade receivables, to be measured based on the expected credit loss model instead of the incurred loss model. The expected credit loss model requires us to consider forward-looking information to estimate our allowance for credit losses. Our adoption of this guidance did not have a material impact on our financial position, results of operations or cash flows. |
Goodwill and Other Intangible_2
Goodwill and Other Intangibles Resulting from Business Acquisitions (Tables) | 6 Months Ended |
Jun. 27, 2020 | |
Goodwill and Other Intangibles Resulting from Business Acquisitions | |
Schedule of changes in net carrying amount of goodwill | Label and Retail Branding Industrial and Graphic and Information Healthcare (In millions) Materials Solutions Materials Total Goodwill as of December 28, 2019 $ 407.8 $ 349.3 $ 173.7 $ 930.8 Acquisition (1) — 110.5 — 110.5 Translation adjustments (1.7) .7 (.5) (1.5) Goodwill as of June 27, 2020 $ 406.1 $ 460.5 $ 173.2 $ 1,039.8 (1) |
Summary of the preliminary amounts and weighted useful lives of finite-lived intangible assets | Amortization Amount period (in millions) (in years) Patents and other acquired technology $ 60.0 11 Customer relationships 16.0 6 Trade names and trademarks 2.0 5 |
Cost Reduction Actions (Tables)
Cost Reduction Actions (Tables) | 6 Months Ended |
Jun. 27, 2020 | |
Cost Reduction Actions | |
Restructuring charges and payments | Charges, Foreign Accrual at Net of Cash Non-cash Currency Accrual at (In millions) December 28, 2019 Reversals Payments Impairment Translation June 27, 2020 2019/2020 Actions Severance and related costs $ 21.9 $ 40.2 $ (17.8) $ — $ .5 $ 44.8 Asset impairment — 1.7 — (1.7) — — 2018/2019 Actions Severance and related costs 6.5 (.2) (6.2) — .1 .2 Lease cancellation costs .3 — — — — .3 Total $ 28.7 $ 41.7 $ (24.0) $ (1.7) $ .6 $ 45.3 |
Restructuring charges, net of reversals, by reportable segment | Three Months Ended Six Months Ended (In millions) June 27, 2020 June 29, 2019 June 27, 2020 June 29, 2019 Restructuring charges, net of reversals, by reportable segment Label and Graphic Materials $ 25.8 $ 4.4 $ 26.2 $ 12.7 Retail Branding and Information Solutions 12.2 1.7 13.7 2.2 Industrial and Healthcare Materials 1.5 1.4 2.0 3.3 Corporate (.2) — (.2) — Total $ 39.3 $ 7.5 $ 41.7 $ 18.2 |
Taxes Based on Income (Tables)
Taxes Based on Income (Tables) | 6 Months Ended |
Jun. 27, 2020 | |
Taxes Based on Income | |
Summary of income before taxes, Provision for (benefit from) income taxes, and effective tax rate from continuing operations | Three Months Ended Six Months Ended (Dollars in millions) June 27, 2020 June 29, 2019 June 27, 2020 June 29, 2019 Income (loss) before taxes $ 103.3 $ 188.7 $ 284.2 $ (95.7) Provision for (benefit from) income taxes 22.2 44.9 68.5 (93.5) Effective tax rate 21.5 % 23.8 % 24.1 % 97.7 % |
Net Income (Loss) Per Common _2
Net Income (Loss) Per Common Share (Tables) | 6 Months Ended |
Jun. 27, 2020 | |
Net Income (Loss) Per Common Share | |
Schedule of net income (loss) per common share | Three Months Ended Six Months Ended (In millions, except per share amounts) June 27, 2020 June 29, 2019 June 27, 2020 June 29, 2019 (A) Net income (loss) available to common shareholders $ 79.7 $ 143.4 $ 213.9 $ (3.5) (B) Weighted average number of common shares outstanding 83.4 84.3 83.4 84.3 Dilutive shares (additional common shares issuable under stock-based awards) .4 .8 .5 — (C) Weighted average number of common shares outstanding, assuming dilution 83.8 85.1 83.9 84.3 Net income (loss) per common share: (A) ÷ (B) $ .96 $ 1.70 $ 2.56 $ (.04) Net income (loss) per common share, assuming dilution: (A) ÷ (C) $ .95 $ 1.69 $ 2.55 $ (.04) |
Supplemental Equity and Compr_2
Supplemental Equity and Comprehensive Income Information (Tables) | 6 Months Ended |
Jun. 27, 2020 | |
Supplemental Equity and Comprehensive Income Information | |
Schedule of Consolidated Statements of Shareholders' Equity | Three Months Ended Six Months Ended (In millions) June 27, 2020 June 29, 2019 June 27, 2020 June 29, 2019 Common stock issued, $1 par value per share $ 124.1 $ 124.1 $ 124.1 $ 124.1 Capital in excess of par value Beginning balance $ 852.5 $ 851.5 $ 874.0 $ 872.0 Issuance of shares under stock-based compensation plans (1) (12.5) 6.2 (34.0) (14.3) Ending balance $ 840.0 $ 857.7 $ 840.0 $ 857.7 Retained earnings Beginning balance $ 3,064.8 $ 2,663.5 $ 2,979.1 $ 2,864.9 Net income (loss) 79.7 143.4 213.9 (3.5) Issuance of shares under stock-based compensation plans (1) .9 .9 (3.3) (13.4) Contribution of shares to 401(k) Plan (1) 3.2 3.3 7.3 7.0 Dividends (48.4) (48.8) (96.8) (92.7) Ending balance $ 3,100.2 $ 2,762.3 $ 3,100.2 $ 2,762.3 Treasury stock at cost Beginning balance $ (2,456.0) $ (2,287.8) $ (2,425.1) $ (2,223.9) Repurchase of shares for treasury — (27.9) (45.2) (116.6) Issuance of shares under stock-based compensation plans (1) 6.6 1.8 18.6 24.1 Contribution of shares to 401(k) Plan (1) 2.2 2.1 4.5 4.6 Ending balance $ (2,447.2) $ (2,311.8) $ (2,447.2) $ (2,311.8) Accumulated other comprehensive loss Beginning balance $ (412.0) $ (359.4) $ (348.1) $ (682.0) Other comprehensive income (loss), net of tax (2) 8.8 (10.4) (55.1) 312.2 Ending balance $ (403.2) $ (369.8) $ (403.2) $ (369.8) (1) (2) |
Schedule of dividends per common share | Three Months Ended Six Months Ended June 27, 2020 June 29, 2019 June 27, 2020 June 29, 2019 Dividends per common share $ .58 $ .58 $ 1.16 $ 1.10 |
Schedule of changes in "Accumulated other comprehensive loss" (net of tax) | Pension and Foreign Other Currency Postretirement Cash Flow (In millions) Translation Benefits Hedges Total Balance as of December 28, 2019 $ (245.1) $ (101.8) $ (1.2) $ (348.1) Other comprehensive loss before reclassifications, net of tax (55.0) — (1.5) (56.5) Reclassifications to net income, net of tax — 1.3 .1 1.4 Net current-period other comprehensive (loss) income, net of tax (55.0) 1.3 (1.4) (55.1) Balance as of June 27, 2020 $ (300.1) $ (100.5) $ (2.6) $ (403.2) Pension and Foreign Other Currency Postretirement Cash Flow (In millions) Translation Benefits Hedges Total Balance as of December 29, 2018 $ (247.4) $ (434.3) $ (.3) $ (682.0) Other comprehensive income before reclassifications, net of tax (1) 11.6 36.0 .3 47.9 Reclassifications to net loss, net of tax (2) — 264.9 (.6) 264.3 Net current-period other comprehensive income (loss), net of tax 11.6 300.9 (.3) 312.2 Balance as of June 29, 2019 $ (235.8) $ (133.4) $ (.6) $ (369.8) (1) (2) |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 6 Months Ended |
Jun. 27, 2020 | |
Fair Value Measurements | |
Assets and liabilities carried at fair value, measured on a recurring basis | The following table provides the assets and liabilities carried at fair value, measured on a recurring basis, as of June 27, 2020: Fair Value Measurements Using Significant Significant Quoted Prices Other Other in Active Observable Unobservable Markets Inputs Inputs (In millions) Total (Level 1) (Level 2) (Level 3) Assets Trading securities $ 31.6 $ 25.7 $ 5.9 $ — Derivative assets 7.3 — 7.3 — Bank drafts 25.6 25.6 — — Liabilities Derivative liabilities $ 13.0 $ .3 $ 12.7 $ — The following table provides the assets and liabilities carried at fair value, measured on a recurring basis, as of December 28, 2019: Fair Value Measurements Using Significant Significant Quoted Prices Other Other in Active Observable Unobservable Markets Inputs Inputs (In millions) Total (Level 1) (Level 2) (Level 3) Assets Trading securities $ 30.6 $ 26.0 $ 4.6 $ — Derivative assets 5.2 — 5.2 — Bank drafts 21.3 21.3 — — Liabilities Derivative liabilities $ 6.0 $ .4 $ 5.6 $ — |
Commitments and Contingencies (
Commitments and Contingencies (Tables) | 3 Months Ended |
Mar. 28, 2020 | |
Commitments and Contingencies | |
Summary of costs of environmental liabilities with remediation | (In millions) Balance at December 28, 2019 $ 21.4 Charges, net of reversals .8 Payments (2.4) Balance at June 27, 2020 $ 19.8 |
Segment and Disaggregated Rev_2
Segment and Disaggregated Revenue Information (Tables) | 6 Months Ended |
Jun. 27, 2020 | |
Segment and Disaggregated Revenue Information | |
Summary of net sales to unaffiliated customers | Three Months Ended Six Months Ended (In millions) June 27, 2020 June 29, 2019 June 27, 2020 June 29, 2019 Net sales to unaffiliated customers Label and Graphic Materials: U.S. (1) $ 315.1 $ 320.1 $ 643.2 $ 631.8 Europe (1) 422.3 452.2 867.6 902.1 Asia (1) 230.7 267.1 472.0 523.3 Latin America 70.9 94.4 161.1 185.0 Other international 62.5 72.5 131.1 142.4 Total Label and Graphic Materials (1) 1,101.5 1,206.3 2,275.0 2,384.6 Retail Branding and Information Solutions: Apparel (1) 255.0 370.4 613.6 723.5 Printer Solutions 39.9 47.9 83.2 93.1 Total Retail Branding and Information Solutions (1) 294.9 418.3 696.8 816.6 Industrial and Healthcare Materials 132.1 171.1 279.7 334.6 Net sales to unaffiliated customers $ 1,528.5 $ 1,795.7 $ 3,251.5 $ 3,535.8 (1) |
Summary of additional financial information by reportable segment | Three Months Ended Six Months Ended (In millions) June 27, 2020 June 29, 2019 June 27, 2020 June 29, 2019 Intersegment sales Label and Graphic Materials $ 12.9 $ 20.1 $ 35.3 $ 41.3 Retail Branding and Information Solutions 5.6 5.0 12.1 9.2 Industrial and Healthcare Materials 1.2 2.9 2.8 5.5 Intersegment sales $ 19.7 $ 28.0 $ 50.2 $ 56.0 Income (loss) before taxes Label and Graphic Materials (1) $ 137.5 $ 162.1 $ 310.0 $ 301.6 Retail Branding and Information Solutions (1) (10.7) 50.4 20.2 101.8 Industrial and Healthcare Materials 7.5 16.5 22.4 30.1 Corporate expense (10.8) (19.9) (29.9) (42.8) Interest expense (20.0) (19.5) (38.8) (39.0) Other non-operating expense, net (.2) (.9) .3 (447.4) Income (loss) before taxes $ 103.3 $ 188.7 $ 284.2 $ (95.7) Other expense, net by reportable segment Label and Graphic Materials (1) $ 25.8 $ 4.4 $ 26.9 $ 12.0 Retail Branding and Information Solutions (1) 12.9 1.7 16.2 (.3) Industrial and Healthcare Materials 1.5 1.4 2.0 3.3 Corporate (.2) — (.2) — Other expense, net $ 40.0 $ 7.5 $ 44.9 $ 15.0 Other expense, net by type Restructuring charges: Severance and related costs $ 37.5 $ 6.1 $ 39.9 $ 16.5 Asset impairment charges and lease cancellation costs 1.8 1.4 1.8 1.7 Other items: Transaction and related costs .7 — 3.2 — Gain on sales of assets — — — (3.2) Other expense, net $ 40.0 $ 7.5 $ 44.9 $ 15.0 (1) |
Supplemental Financial Inform_2
Supplemental Financial Information (Tables) | 6 Months Ended |
Jun. 27, 2020 | |
Supplemental Financial Information | |
Schedule of net inventories | (In millions) June 27, 2020 December 28, 2019 Raw materials $ 279.0 $ 231.6 Work-in-progress 202.3 201.0 Finished goods 245.3 230.4 Inventories, net $ 726.6 $ 663.0 |
Schedule of property, plant and equipment | (In millions) June 27, 2020 December 28, 2019 Property, plant and equipment $ 3,235.7 $ 3,171.6 Accumulated depreciation (2,006.9) (1,960.9) Property, plant and equipment, net $ 1,228.8 $ 1,210.7 |
Schedule of allowance for credit losses | (In millions) Balance at December 28, 2019 $ 27.1 Provision for credit losses (1) 20.6 Amounts written off (1.4) Other, including foreign currency translation .1 Balance at June 27, 2020 $ 46.4 (1) |
General (Details)
General (Details) | 3 Months Ended | 6 Months Ended | ||
Jun. 27, 2020 | Jun. 29, 2019 | Jun. 27, 2020 | Jun. 29, 2019 | |
General | ||||
Length of fiscal period | 91 days | 91 days | 182 days | 182 days |
Acquisitions (Details)
Acquisitions (Details) - Smartrac Acquisition € in Millions, $ in Millions | Feb. 28, 2020USD ($) | Feb. 28, 2020EUR (€) | Jun. 27, 2020USD ($) |
Acquisitions | |||
Purchase consideration | $ 255 | € 232 | |
Business Combination, Payable amount of customary adjustments | $ 4.9 |
Goodwill and Other Intangible_3
Goodwill and Other Intangibles Resulting from Business Acquisitions (Details) $ in Millions | 6 Months Ended |
Jun. 27, 2020USD ($) | |
Changes in the net carrying amount of goodwill | |
Goodwill, Beginning Balance | $ 930.8 |
Acquisition(1) | 110.5 |
Translation adjustments | (1.5) |
Goodwill, Ending Balance | 1,039.8 |
Smartrac Acquisition | |
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Intangible Assets, Other than Goodwill [Abstract] | |
Intangible assets acquired | $ 78 |
Discount rate used to value the intangibles | 13.50% |
Patents and other acquired technology | |
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Intangible Assets, Other than Goodwill [Abstract] | |
Intangible assets acquired | $ 60 |
Amortization period (in years) | 11 years |
Customer relationships | |
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Intangible Assets, Other than Goodwill [Abstract] | |
Intangible assets acquired | $ 16 |
Amortization period (in years) | 6 years |
Trade names and trademarks | |
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Intangible Assets, Other than Goodwill [Abstract] | |
Intangible assets acquired | $ 2 |
Amortization period (in years) | 5 years |
Label and Graphic Materials | |
Changes in the net carrying amount of goodwill | |
Goodwill, Beginning Balance | $ 407.8 |
Translation adjustments | (1.7) |
Goodwill, Ending Balance | 406.1 |
Retail Branding and Information Solutions | |
Changes in the net carrying amount of goodwill | |
Goodwill, Beginning Balance | 349.3 |
Acquisition(1) | 110.5 |
Translation adjustments | 0.7 |
Goodwill, Ending Balance | 460.5 |
Industrial and Healthcare Materials | |
Changes in the net carrying amount of goodwill | |
Goodwill, Beginning Balance | 173.7 |
Translation adjustments | (0.5) |
Goodwill, Ending Balance | $ 173.2 |
Debt (Details)
Debt (Details) - USD ($) $ in Millions | Apr. 30, 2020 | Mar. 28, 2020 | Feb. 29, 2020 | Jun. 27, 2020 | Jun. 27, 2020 | Dec. 28, 2019 |
Debt | ||||||
Repayment of medium-term notes | $ 15 | |||||
Fair value of debt | 2,430 | $ 2,430 | $ 2,050 | |||
Aggregate principal amount | $ 250 | |||||
Covenants compliance | we were in compliance with our financial covenants under the Revolver. | we were in compliance with our financial covenants under the Revolver. | ||||
Revolving credit facility | ||||||
Debt | ||||||
Maximum borrowing capacity | $ 800 | |||||
Commitment for increased borrowing | $ 400 | |||||
Amount outstanding | $ 0 | $ 0 | $ 0 | |||
Senior Notes Due April [2030] | ||||||
Debt | ||||||
Debt Instrument, Face Amount | $ 500 | |||||
Debt Instrument, Interest Rate, Stated Percentage | 2.65% | |||||
Proceeds, net of underwriting discounts and estimated offering expenses | $ 493.7 |
Pension and Other Postretirem_2
Pension and Other Postretirement Benefits (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | 12 Months Ended |
Jun. 29, 2019 | Jun. 29, 2019 | Dec. 28, 2019 | |
Components of net periodic benefit cost (credit) | |||
Recognized loss on settlements | $ 446.9 | ||
ADPP | |||
Components of net periodic benefit cost (credit) | |||
Settlements | $ 753 | ||
Related tax benefits | 179 | ||
Pretax charge related to the effective settlement of the ADPP | 446.9 | ||
U.S. plans | |||
Components of net periodic benefit cost (credit) | |||
Net periodic benefit cost | $ 2 | 449.7 | |
Settlements | 446.9 | ||
International plans | |||
Components of net periodic benefit cost (credit) | |||
Net periodic benefit cost | $ 3.2 | $ 6.5 |
Cost Reduction Actions - Additi
Cost Reduction Actions - Additional Information (Details) $ in Millions | 6 Months Ended |
Jun. 27, 2020USD ($)position | |
2018 Plan | |
Cost Reduction Actions | |
Net restructuring reversals | $ 0.2 |
2019/2020 Actions | |
Cost Reduction Actions | |
Restructuring charges | $ 41.9 |
Number of positions eliminated | position | 1,750 |
Cost Reduction Actions - Restru
Cost Reduction Actions - Restructuring Charges and Payments (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jun. 27, 2020 | Jun. 29, 2019 | Jun. 27, 2020 | Jun. 29, 2019 | |
Cost Reduction Actions | ||||
Beginning Balance | $ 28.7 | |||
Charges, Net of Reversals | 41.7 | |||
Cash Payments | (24) | |||
Non-cash Impairment | (1.7) | |||
Foreign Currency Translation | 0.6 | |||
Ending Balance | $ 45.3 | 45.3 | ||
Severance and related costs | ||||
Cost Reduction Actions | ||||
Charges, Net of Reversals | 37.5 | $ 6.1 | 39.9 | $ 16.5 |
2018/2019 Actions | Severance and related costs | ||||
Cost Reduction Actions | ||||
Beginning Balance | 6.5 | |||
Charges, Net of Reversals | (0.2) | |||
Cash Payments | (6.2) | |||
Foreign Currency Translation | 0.1 | |||
Ending Balance | 0.2 | 0.2 | ||
2018/2019 Actions | Lease cancellation | ||||
Cost Reduction Actions | ||||
Beginning Balance | 0.3 | |||
Ending Balance | 0.3 | 0.3 | ||
2019/2020 Actions | Severance and related costs | ||||
Cost Reduction Actions | ||||
Beginning Balance | 21.9 | |||
Charges, Net of Reversals | 40.2 | |||
Cash Payments | (17.8) | |||
Foreign Currency Translation | 0.5 | |||
Ending Balance | 44.8 | 44.8 | ||
2019/2020 Actions | Asset impairment charges | ||||
Cost Reduction Actions | ||||
Beginning Balance | 0 | |||
Charges, Net of Reversals | 1.7 | |||
Non-cash Impairment | (1.7) | |||
Ending Balance | $ 0 | $ 0 |
Cost Reduction Actions - Rest_2
Cost Reduction Actions - Restructuring Charges, net of reversals (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jun. 27, 2020 | Jun. 29, 2019 | Jun. 27, 2020 | Jun. 29, 2019 | |
Restructuring charges: | ||||
Restructuring charges | $ 41.7 | |||
Other expense, net | ||||
Restructuring charges: | ||||
Restructuring charges | $ 39.3 | $ 7.5 | 41.7 | $ 18.2 |
Label and Graphic Materials | Other expense, net | ||||
Restructuring charges: | ||||
Restructuring charges | 25.8 | 4.4 | 26.2 | 12.7 |
Retail Branding and Information Solutions | Other expense, net | ||||
Restructuring charges: | ||||
Restructuring charges | 12.2 | 1.7 | 13.7 | 2.2 |
Industrial and Healthcare Materials | Other expense, net | ||||
Restructuring charges: | ||||
Restructuring charges | 1.5 | $ 1.4 | 2 | $ 3.3 |
Corporate | Other expense, net | ||||
Restructuring charges: | ||||
Restructuring charges | $ (0.2) | $ (0.2) |
Financial Instruments - (Detail
Financial Instruments - (Details) - USD ($) $ in Millions | Jun. 27, 2020 | Mar. 28, 2020 |
Cross currency contract | ||
Financial Instruments | ||
Notional amount | $ 250 | |
Long-term retirement benefits and other liabilities | ||
Financial Instruments | ||
Fair value of the contract | $ (3) |
Taxes Based on Income (Details)
Taxes Based on Income (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jun. 27, 2020 | Jun. 29, 2019 | Jun. 27, 2020 | Jun. 29, 2019 | |
Income (loss) before taxes | $ 103.3 | $ 188.7 | $ 284.2 | $ (95.7) |
Provision for (benefit from) income taxes | $ 22.2 | $ 44.9 | $ 68.5 | $ (93.5) |
Effective tax rate (as a percent) | 21.50% | 23.80% | 24.10% | 97.70% |
Net tax charge related to the tax on global intangible low-taxed income (GILTI) of our foreign subsidiaries and the recognition of foreign withholding taxes on current year earnings, partially offset by the benefit from foreign-derived intangible income (FDII) | $ 3.3 | $ 4.9 | $ 10.5 | $ 10.3 |
Net discrete tax benefit primarily from decreases in certain tax reserves, including associated interest and penalties, as a result of closing tax years and effective settlements of certain foreign tax audits | 11.8 | 11.8 | ||
Tax benefit from decreases in certain tax reserves, including interest and penalties, as a result of closing tax years | 11.5 | |||
Tax benefits related to excess tax benefits associated with stock-based payments | 2.8 | 6.8 | ||
Reasonably possible decrease in uncertain tax positions, including interest and penalties, primarily as a result of audit settlements and closing tax years during the next 12 months | $ 10 | $ 10 | ||
ADPP | ||||
Discrete tax benefits related to the effective settlement of the ADPP | 179 | |||
Tax benefits related to the effective settlement of the ADPP on the tax effect of the pretax charge | 102 | |||
Pretax charge related to the effective settlement of the ADPP | 446.9 | |||
Tax benefit related to release of stranded tax effects in AOCI through income statement | $ 77 |
Net Income (Loss) Per Common _3
Net Income (Loss) Per Common Share (Details) - USD ($) $ / shares in Units, shares in Millions, $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jun. 27, 2020 | Jun. 29, 2019 | Jun. 27, 2020 | Jun. 29, 2019 | |
Net Income (Loss) Per Common Share | ||||
Net income (loss) available to common shareholders | $ 79.7 | $ 143.4 | $ 213.9 | $ (3.5) |
Weighted average number of common shares outstanding | 83.4 | 84.3 | 83.4 | 84.3 |
Dilutive shares (additional common shares issuable under stock-based awards) | 0.4 | 0.8 | 0.5 | |
Weighted average number of common shares outstanding, assuming dilution | 83.8 | 85.1 | 83.9 | 84.3 |
Net income (loss) per common share (in dollars per share) | $ 0.96 | $ 1.70 | $ 2.56 | $ (0.04) |
Net income (loss) per common share, assuming dilution (in dollars per share) | $ 0.95 | $ 1.69 | $ 2.55 | $ (0.04) |
Antidilutive shares, share-based compensation awards | 1 |
Supplemental Equity and Compr_3
Supplemental Equity and Comprehensive Income Information - Consolidated Statements of Shareholders' Equity (Details) - USD ($) $ / shares in Units, $ in Millions | 3 Months Ended | 6 Months Ended | |||||
Jun. 27, 2020 | Jun. 29, 2019 | Jun. 27, 2020 | Jun. 29, 2019 | Mar. 28, 2020 | Dec. 28, 2019 | Mar. 30, 2019 | |
Increase (Decrease) in Stockholders' Equity | |||||||
Common stock issued, $1 par value per share | $ 124.1 | $ 124.1 | $ 124.1 | $ 124.1 | $ 124.1 | ||
Common stock, par value (in dollars per share) | $ 1 | $ 1 | $ 1 | $ 1 | $ 1 | ||
Beginning balance | $ 1,204 | ||||||
Net income (loss) | $ 79.7 | 143.4 | 213.9 | (3.5) | |||
Other comprehensive income (loss), net of tax | 8.8 | $ (10.4) | (55.1) | $ 312.2 | |||
Ending balance | $ 1,213.9 | $ 1,213.9 | |||||
Dividends per common share (in dollars per share) | $ 0.58 | $ 0.58 | $ 1.16 | $ 1.10 | |||
Capital in excess of par value | |||||||
Increase (Decrease) in Stockholders' Equity | |||||||
Beginning balance | $ 852.5 | $ 851.5 | $ 874 | $ 872 | |||
Issuance of shares under stock-based compensation plans | (12.5) | 6.2 | (34) | (14.3) | |||
Ending balance | 840 | 857.7 | 840 | 857.7 | |||
Retained earnings | |||||||
Increase (Decrease) in Stockholders' Equity | |||||||
Beginning balance | 3,064.8 | 2,663.5 | 2,979.1 | 2,864.9 | |||
Net income (loss) | 79.7 | 143.4 | 213.9 | (3.5) | |||
Issuance of shares under stock-based compensation plans | 0.9 | 0.9 | (3.3) | (13.4) | |||
Contribution of shares to 401(k) Plan | 3.2 | 3.3 | 7.3 | 7 | |||
Dividends | (48.4) | (48.8) | (96.8) | (92.7) | |||
Ending balance | 3,100.2 | 2,762.3 | 3,100.2 | 2,762.3 | |||
Treasury stock at cost | |||||||
Increase (Decrease) in Stockholders' Equity | |||||||
Beginning balance | (2,456) | (2,287.8) | (2,425.1) | (2,223.9) | |||
Repurchase of shares for treasury | (27.9) | (45.2) | (116.6) | ||||
Issuance of shares under stock-based compensation plans | 6.6 | 1.8 | 18.6 | 24.1 | |||
Contribution of shares to 401(k) Plan | 2.2 | 2.1 | 4.5 | 4.6 | |||
Ending balance | (2,447.2) | (2,311.8) | (2,447.2) | (2,311.8) | |||
Accumulated other comprehensive loss | |||||||
Increase (Decrease) in Stockholders' Equity | |||||||
Beginning balance | (412) | (359.4) | (348.1) | (682) | |||
Other comprehensive income (loss), net of tax | 8.8 | (10.4) | (55.1) | 312.2 | |||
Ending balance | $ (403.2) | $ (369.8) | $ (403.2) | $ (369.8) |
Supplemental Equity and Compr_4
Supplemental Equity and Comprehensive Income Information - Changes in AOCI (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jun. 27, 2020 | Jun. 29, 2019 | Jun. 27, 2020 | Jun. 29, 2019 | |
Changes in Accumulated other comprehensive loss (net of tax) | ||||
Balance at beginning of the period | $ (348.1) | $ (682) | ||
Other comprehensive (loss) income before reclassifications, net of tax | (56.5) | 47.9 | ||
Reclassifications to net income, net of tax | 1.4 | 264.3 | ||
Net current-period other comprehensive (loss) income, net of tax | $ 8.8 | $ (10.4) | (55.1) | 312.2 |
Balance at end of the period | (403.2) | (369.8) | (403.2) | (369.8) |
ADPP | ||||
Changes in Accumulated other comprehensive loss (net of tax) | ||||
Reclassifications to net income, net of tax | 179.3 | |||
Foreign Currency Translation | ||||
Changes in Accumulated other comprehensive loss (net of tax) | ||||
Balance at beginning of the period | (245.1) | (247.4) | ||
Other comprehensive (loss) income before reclassifications, net of tax | (55) | 11.6 | ||
Net current-period other comprehensive (loss) income, net of tax | (55) | 11.6 | ||
Balance at end of the period | (300.1) | (235.8) | (300.1) | (235.8) |
Pension and Other Postretirement Benefits | ||||
Changes in Accumulated other comprehensive loss (net of tax) | ||||
Balance at beginning of the period | (101.8) | (434.3) | ||
Other comprehensive (loss) income before reclassifications, net of tax | 36 | |||
Reclassifications to net income, net of tax | 1.3 | 264.9 | ||
Net current-period other comprehensive (loss) income, net of tax | 1.3 | 300.9 | ||
Balance at end of the period | (100.5) | (133.4) | (100.5) | (133.4) |
Pension and Other Postretirement Benefits | ADPP | ||||
Changes in Accumulated other comprehensive loss (net of tax) | ||||
Other comprehensive (loss) income before reclassifications, net of tax | 10.7 | |||
Reclassifications to net income, net of tax | 444.2 | |||
Cash Flow Hedges | ||||
Changes in Accumulated other comprehensive loss (net of tax) | ||||
Balance at beginning of the period | (1.2) | (0.3) | ||
Other comprehensive (loss) income before reclassifications, net of tax | (1.5) | 0.3 | ||
Reclassifications to net income, net of tax | 0.1 | (0.6) | ||
Net current-period other comprehensive (loss) income, net of tax | (1.4) | (0.3) | ||
Balance at end of the period | $ (2.6) | $ (0.6) | $ (2.6) | $ (0.6) |
Fair Value Measurements (Detail
Fair Value Measurements (Details) - USD ($) $ in Millions | Jun. 27, 2020 | Dec. 28, 2019 |
Cash and cash equivalents | ||
Assets | ||
Trading securities | $ 0.6 | $ 0.4 |
Other current assets | ||
Assets | ||
Trading securities | 31 | 30.2 |
Recurring | ||
Assets | ||
Trading securities | 31.6 | 30.6 |
Derivative assets | 7.3 | 5.2 |
Bank drafts | 25.6 | 21.3 |
Liabilities | ||
Derivative liabilities | 13 | 6 |
Quoted Prices in Active Markets (Level 1) | ||
Assets | ||
Trading securities | 25.7 | 26 |
Bank drafts | 25.6 | 21.3 |
Liabilities | ||
Derivative liabilities | 0.3 | 0.4 |
Significant Other Observable Inputs (Level 2) | ||
Assets | ||
Trading securities | 5.9 | 4.6 |
Derivative assets | 7.3 | 5.2 |
Liabilities | ||
Derivative liabilities | $ 12.7 | $ 5.6 |
Commitments and Contingencies_2
Commitments and Contingencies (Details) $ in Millions | 6 Months Ended | |
Jun. 27, 2020USD ($)site | Dec. 28, 2019USD ($) | |
Environmental Liabilities Associated with Remediation | ||
Environmental site contingency number of sites | site | 12 | |
Balance at beginning of the period | $ 21.4 | |
Charges, net of reversals | 0.8 | |
Payments | (2.4) | |
Balance at end of the period | 19.8 | |
Short term environmental liabilities | $ 9 | $ 10 |
Segment and Disaggregated Rev_3
Segment and Disaggregated Revenue Information - Net Sales to Unaffiliated Customers (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jun. 27, 2020 | Jun. 29, 2019 | Jun. 27, 2020 | Jun. 29, 2019 | |
Net sales to unaffiliated customers | ||||
Net sales to unaffiliated customers | $ 1,528.5 | $ 1,795.7 | $ 3,251.5 | $ 3,535.8 |
Retail Branding and Information Solutions | ||||
Net sales to unaffiliated customers | ||||
Net sales to unaffiliated customers | 294.9 | 418.3 | 696.8 | 816.6 |
Retail Branding and Information Solutions | Apparel | ||||
Net sales to unaffiliated customers | ||||
Net sales to unaffiliated customers | 255 | 370.4 | 613.6 | 723.5 |
Retail Branding and Information Solutions | Printer Solutions | ||||
Net sales to unaffiliated customers | ||||
Net sales to unaffiliated customers | 39.9 | 47.9 | 83.2 | 93.1 |
Label and Graphic Materials | ||||
Net sales to unaffiliated customers | ||||
Net sales to unaffiliated customers | 1,101.5 | 1,206.3 | 2,275 | 2,384.6 |
Industrial and Healthcare Materials | ||||
Net sales to unaffiliated customers | ||||
Net sales to unaffiliated customers | 132.1 | 171.1 | 279.7 | 334.6 |
U.S. | Label and Graphic Materials | ||||
Net sales to unaffiliated customers | ||||
Net sales to unaffiliated customers | 315.1 | 320.1 | 643.2 | 631.8 |
Europe | Label and Graphic Materials | ||||
Net sales to unaffiliated customers | ||||
Net sales to unaffiliated customers | 422.3 | 452.2 | 867.6 | 902.1 |
Asia | Label and Graphic Materials | ||||
Net sales to unaffiliated customers | ||||
Net sales to unaffiliated customers | 230.7 | 267.1 | 472 | 523.3 |
Latin America | Label and Graphic Materials | ||||
Net sales to unaffiliated customers | ||||
Net sales to unaffiliated customers | 70.9 | 94.4 | 161.1 | 185 |
Other international | Label and Graphic Materials | ||||
Net sales to unaffiliated customers | ||||
Net sales to unaffiliated customers | $ 62.5 | $ 72.5 | $ 131.1 | $ 142.4 |
Segment and Disaggregated Rev_4
Segment and Disaggregated Revenue Information - Sales (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jun. 27, 2020 | Jun. 29, 2019 | Jun. 27, 2020 | Jun. 29, 2019 | |
Segment Information | ||||
Net sales to unaffiliated customers | $ 1,528.5 | $ 1,795.7 | $ 3,251.5 | $ 3,535.8 |
Corporate expense | (10.8) | (19.9) | (29.9) | (42.8) |
Interest expense | (20) | (19.5) | (38.8) | (39) |
Other non-operating expense, net | (0.2) | (0.9) | 0.3 | (447.4) |
Income (loss) before taxes | 103.3 | 188.7 | 284.2 | (95.7) |
Other expense, net | 40 | 7.5 | 44.9 | 15 |
Intersegment sales | ||||
Segment Information | ||||
Net sales to unaffiliated customers | 19.7 | 28 | 50.2 | 56 |
Label and Graphic Materials | ||||
Segment Information | ||||
Net sales to unaffiliated customers | 1,101.5 | 1,206.3 | 2,275 | 2,384.6 |
Label and Graphic Materials | Operating segments | ||||
Segment Information | ||||
Net sales to unaffiliated customers | 12.9 | 20.1 | 35.3 | 41.3 |
Income (loss) before taxes | 137.5 | 162.1 | 310 | 301.6 |
Other expense, net | 25.8 | 4.4 | 26.9 | 12 |
Retail Branding and Information Solutions | Operating segments | ||||
Segment Information | ||||
Net sales to unaffiliated customers | 5.6 | 5 | 12.1 | 9.2 |
Income (loss) before taxes | (10.7) | 50.4 | 20.2 | 101.8 |
Other expense, net | 12.9 | 1.7 | 16.2 | (0.3) |
Industrial and Healthcare Materials | ||||
Segment Information | ||||
Net sales to unaffiliated customers | 132.1 | 171.1 | 279.7 | 334.6 |
Industrial and Healthcare Materials | Operating segments | ||||
Segment Information | ||||
Net sales to unaffiliated customers | 1.2 | 2.9 | 2.8 | 5.5 |
Income (loss) before taxes | 7.5 | 16.5 | 22.4 | 30.1 |
Other expense, net | 1.5 | $ 1.4 | 2 | $ 3.3 |
Corporate | Operating segments | ||||
Segment Information | ||||
Other expense, net | $ (0.2) | $ (0.2) |
Segment and Disaggregated Rev_5
Segment and Disaggregated Revenue Information - Other expense, net by Type (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jun. 27, 2020 | Jun. 29, 2019 | Jun. 27, 2020 | Jun. 29, 2019 | |
Restructuring charges: | ||||
Restructuring charges | $ 41.7 | |||
Other items: | ||||
Transaction and related costs | $ 0.7 | 3.2 | ||
Gain on sale of assets | $ (3.2) | |||
Other expense, net | 40 | $ 7.5 | 44.9 | 15 |
Severance and related costs | ||||
Restructuring charges: | ||||
Restructuring charges | 37.5 | 6.1 | 39.9 | 16.5 |
Asset impairment charges and lease cancellation costs | ||||
Restructuring charges: | ||||
Restructuring charges | $ 1.8 | $ 1.4 | $ 1.8 | $ 1.7 |
Supplemental Financial Inform_3
Supplemental Financial Information (Details) - USD ($) $ in Millions | 6 Months Ended | |
Jun. 27, 2020 | Dec. 28, 2019 | |
Inventories | ||
Raw materials | $ 279 | $ 231.6 |
Work-in-progress | 202.3 | 201 |
Finished goods | 245.3 | 230.4 |
Inventories, net | 726.6 | 663 |
Property, Plant and Equipment | ||
Property, plant and equipment | 3,235.7 | 3,171.6 |
Accumulated depreciation | (2,006.9) | (1,960.9) |
Property, plant and equipment, net | 1,228.8 | $ 1,210.7 |
Allowance for Credit Losses | ||
Beginning Balance | 27.1 | |
Provision for credit losses | 20.6 | |
Amounts written off | (1.4) | |
Other, including foreign currency translation | 0.1 | |
Ending Balance | $ 46.4 |