Cover Page
Cover Page - shares | 6 Months Ended | |
Mar. 25, 2023 | Apr. 30, 2023 | |
Document Information [Line Items] | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Period End Date | Mar. 25, 2023 | |
Document Transition Report | false | |
Entity File Number | 001-33268 | |
Entity Registrant Name | Central Garden & Pet Company | |
Entity Incorporation, State or Country Code | DE | |
Entity Tax Identification Number | 68-0275553 | |
Entity Address, Address Line One | 1340 Treat Blvd. | |
Entity Address, Address Line Two | Suite 600 | |
Entity Address, City or Town | Walnut Creek | |
Entity Address, State or Province | CA | |
Entity Address, Postal Zip Code | 94597 | |
City Area Code | 925 | |
Local Phone Number | 948-4000 | |
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 | |
Amendment Flag | false | |
Document Fiscal Year Focus | 2023 | |
Document Fiscal Period Focus | Q2 | |
Entity Central Index Key | 0000887733 | |
Current Fiscal Year End Date | --09-30 | |
Common Stock | ||
Document Information [Line Items] | ||
Title of 12(b) Security | Common Stock | |
Trading Symbol | CENT | |
Security Exchange Name | NASDAQ | |
Entity Common Stock, Shares Outstanding | 11,221,030 | |
Class A Common Stock | ||
Document Information [Line Items] | ||
Title of 12(b) Security | Class A Common Stock | |
Trading Symbol | CENTA | |
Security Exchange Name | NASDAQ | |
Entity Common Stock, Shares Outstanding | 41,271,743 | |
Class B Stock | ||
Document Information [Line Items] | ||
Entity Common Stock, Shares Outstanding | 1,602,374 |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets - USD ($) $ in Thousands | Mar. 25, 2023 | Sep. 24, 2022 | Mar. 26, 2022 |
Current assets: | |||
Cash and cash equivalents | $ 60,607 | $ 177,442 | $ 54,082 |
Restricted cash | 13,475 | 14,742 | 12,676 |
Accounts receivable (less allowances of $28,283, $28,234 and $26,246) | 564,874 | 376,787 | 619,629 |
Inventories, net | 966,900 | 938,000 | 888,051 |
Prepaid expenses and other | 48,019 | 46,883 | 49,449 |
Total current assets | 1,653,875 | 1,553,854 | 1,623,887 |
Plant, property and equipment, net | 395,788 | 396,979 | 384,940 |
Goodwill | 546,436 | 546,436 | 511,973 |
Other intangible assets, net | 525,301 | 543,210 | 499,251 |
Operating lease right-of-use assets | 174,435 | 186,344 | 204,148 |
Other assets | 54,963 | 55,179 | 125,059 |
Total | 3,350,798 | 3,282,002 | 3,349,258 |
Current liabilities: | |||
Accounts payable | 225,311 | 215,681 | 297,194 |
Accrued expenses | 201,286 | 201,783 | 228,412 |
Current lease liabilities | 49,082 | 48,111 | 44,765 |
Current portion of long-term debt | 270 | 317 | 378 |
Total current liabilities | 475,949 | 465,892 | 570,749 |
Long-term debt | 1,212,053 | 1,186,245 | 1,185,456 |
Long-term lease liabilities | 135,695 | 147,724 | 165,446 |
Deferred income taxes and other long-term obligations | 154,854 | 147,429 | 133,274 |
Equity: | |||
Additional paid-in capital | 587,378 | 582,056 | 580,555 |
Retained earnings | 786,776 | 755,253 | 712,683 |
Accumulated other comprehensive loss | (3,601) | (4,145) | (703) |
Total Central Garden & Pet Company shareholders’ equity | 1,371,094 | 1,333,706 | 1,293,086 |
Noncontrolling interest | 1,153 | 1,006 | 1,247 |
Total equity | 1,372,247 | 1,334,712 | 1,294,333 |
Total | 3,350,798 | 3,282,002 | 3,349,258 |
Common Stock | |||
Equity: | |||
Common stock | 112 | 113 | 113 |
Class A Common Stock | |||
Equity: | |||
Common stock | 413 | 413 | 422 |
Class B Stock | |||
Equity: | |||
Common stock | $ 16 | $ 16 | $ 16 |
Condensed Consolidated Balanc_2
Condensed Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Thousands | Mar. 25, 2023 | Sep. 24, 2022 | Mar. 26, 2022 |
Accounts receivable allowance for doubtful accounts | $ 28,283 | $ 26,246 | $ 28,234 |
Common Stock | |||
Common stock, par value (in dollars per share) | $ 0.01 | $ 0.01 | $ 0.01 |
Common stock, shares outstanding (in shares) | 11,236,635 | 11,296,351 | 11,335,658 |
Class A Common Stock | |||
Common stock, par value (in dollars per share) | $ 0.01 | $ 0.01 | $ 0.01 |
Common stock, shares outstanding (in shares) | 41,289,878 | 41,336,223 | 42,228,533 |
Class B Stock | |||
Common stock, par value (in dollars per share) | $ 0.01 | $ 0.01 | $ 0.01 |
Common stock, shares outstanding (in shares) | 1,602,374 | 1,612,374 | 1,612,374 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Operations - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Mar. 25, 2023 | Mar. 26, 2022 | Mar. 25, 2023 | Mar. 26, 2022 | |
Income Statement [Abstract] | ||||
Net sales | $ 909,004 | $ 954,370 | $ 1,536,667 | $ 1,615,768 |
Cost of goods sold | 649,366 | 667,578 | 1,105,330 | 1,130,780 |
Gross profit | 259,638 | 286,792 | 431,337 | 484,988 |
Selling, general and administrative expenses | 181,597 | 179,947 | 352,890 | 351,929 |
Operating income | 78,041 | 106,845 | 78,447 | 133,059 |
Interest expense | (14,876) | (14,729) | (29,345) | (29,211) |
Interest income | 186 | 27 | 879 | 101 |
Other income (expense) | 595 | (369) | 2,294 | (578) |
Income before income taxes and noncontrolling interest | 63,946 | 91,774 | 52,275 | 103,371 |
Income tax expense | 15,268 | 21,488 | 12,446 | 23,889 |
Income including noncontrolling interest | 48,678 | 70,286 | 39,829 | 79,482 |
Net income attributable to noncontrolling interest | 563 | 573 | 147 | 760 |
Net income attributable to Central Garden & Pet Company | $ 48,115 | $ 69,713 | $ 39,682 | $ 78,722 |
Net income per share attributable to Central Garden & Pet Company: | ||||
Basic (in dollars per share) | $ 0.92 | $ 1.30 | $ 0.76 | $ 1.47 |
Diluted (in dollars per share) | $ 0.90 | $ 1.27 | $ 0.74 | $ 1.44 |
Weighted average shares used in the computation of net income per share: | ||||
Basic (in shares) | 52,443 | 53,458 | 52,461 | 53,475 |
Diluted (in shares) | 53,534 | 54,722 | 53,520 | 54,818 |
Condensed Consolidated Statem_2
Condensed Consolidated Statements of Comprehensive Income - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Mar. 25, 2023 | Mar. 26, 2022 | Mar. 25, 2023 | Mar. 26, 2022 | |
Statement of Comprehensive Income [Abstract] | ||||
Income including noncontrolling interest | $ 48,678 | $ 70,286 | $ 39,829 | $ 79,482 |
Other comprehensive income (loss): | ||||
Foreign currency translation | (238) | 570 | 545 | 128 |
Total comprehensive income | 48,440 | 70,856 | 40,374 | 79,610 |
Comprehensive income attributable to noncontrolling interest | 563 | 573 | 147 | 760 |
Comprehensive income attributable to Central Garden & Pet Company | $ 47,877 | $ 70,283 | $ 40,227 | $ 78,850 |
Condensed Consolidated Statem_3
Condensed Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 6 Months Ended | |
Mar. 25, 2023 | Mar. 26, 2022 | |
Cash flows from operating activities: | ||
Net income | $ 39,829 | $ 79,482 |
Adjustments to reconcile net income to net cash used by operating activities: | ||
Depreciation and amortization | 43,801 | 38,449 |
Amortization of deferred financing costs | 1,349 | 1,316 |
Non-cash lease expense | 25,369 | 23,532 |
Stock-based compensation | 13,327 | 11,479 |
Debt extinguishment costs | 0 | 169 |
Deferred income taxes | 7,486 | 77,416 |
Other operating activities | 136 | (124) |
Change in assets and liabilities (excluding businesses acquired): | ||
Accounts receivable | (187,745) | (234,146) |
Inventories | (27,152) | (202,996) |
Prepaid expenses and other assets | (3,868) | (84,983) |
Accounts payable | 15,421 | 51,195 |
Accrued expenses | (462) | (10,038) |
Other long-term obligations | (21) | (64) |
Operating lease liabilities | (24,542) | (22,768) |
Net cash used by operating activities | (97,072) | (272,081) |
Cash flows from investing activities: | ||
Additions to plant, property and equipment | (30,228) | (75,419) |
Investments | (500) | (1,918) |
Other investing activities | (100) | 100 |
Net cash used in investing activities | (30,828) | (77,237) |
Cash flows from financing activities: | ||
Repayments of long-term debt | (182) | (889) |
Borrowings under revolving line of credit | 48,000 | 0 |
Repayments under revolving line of credit | (23,000) | 0 |
Repurchase of common stock, including shares surrendered for tax withholding | (16,165) | (18,752) |
Payment of contingent consideration liability | (12) | (125) |
Distribution to noncontrolling interest | 0 | (806) |
Payment of financing costs | 0 | (2,442) |
Net cash provided (used) by financing activities | 8,641 | (23,014) |
Effect of exchange rate changes on cash, cash equivalents and restricted cash | 1,157 | (432) |
Net decrease in cash, cash equivalents and restricted cash | (118,102) | (372,764) |
Cash, cash equivalents and restricted cash at beginning of period | 192,184 | 439,522 |
Cash, cash equivalents and restricted cash at end of period | 74,082 | 66,758 |
Supplemental information: | ||
Cash paid for interest | 29,343 | 29,042 |
Cash paid for taxes | 1,889 | 24,603 |
New operating lease right of use assets | $ 13,776 | $ 62,251 |
Basis of Presentation
Basis of Presentation | 6 Months Ended |
Mar. 25, 2023 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis of Presentation | Basis of Presentation The condensed consolidated balance sheets of Central Garden & Pet Company and subsidiaries (the “Company” or “Central”) as of March 25, 2023 and March 26, 2022, the condensed consolidated statements of operations and the condensed consolidated statements of comprehensive income for the three and six months ended March 25, 2023 and March 26, 2022, and the condensed consolidated statements of cash flows for the six months ended March 25, 2023 and March 26, 2022 have been prepared by the Company, without audit. In the opinion of management, the interim financial statements include all normal recurring adjustments necessary for a fair statement of the results for the interim periods presented. For the Company’s foreign businesses in the United Kingdom and Canada, the local currency is the functional currency. Assets and liabilities are translated using the exchange rate in effect at the balance sheet date. Income and expenses are translated at the average exchange rate for the period. Deferred taxes are not provided on translation gains and losses because the Company expects earnings of its foreign subsidiaries to be permanently reinvested. Transaction gains and losses are included in results of operations. Due to the seasonal nature of the Company’s garden business, the results of operations for the three and six months ended March 25, 2023 are not necessarily indicative of the operating results that may be expected for the entire fiscal year. These interim financial statements should be read in conjunction with the annual audited financial statements, accounting policies and financial notes thereto, included in the Company’s Annual Report on Form 10-K for the fiscal year ended September 24, 2022, which has previously been filed with the Securities and Exchange Commission. The September 24, 2022 balance sheet presented herein was derived from the audited financial statements. Noncontrolling Interest Noncontrolling interest in the Company’s condensed consolidated financial statements represents the 20% interest not owned by Central in a consolidated subsidiary. Since the Company controls this subsidiary, its financial statements are consolidated with those of the Company, and the noncontrolling owner’s 20% share of the subsidiary’s net assets and results of operations is deducted and reported as noncontrolling interest on the consolidated balance sheets and as net income (loss) attributable to noncontrolling interest in the condensed consolidated statements of operations. See Note 7, Supplemental Equity Information, for additional information. Cash, Cash Equivalents and Restricted Cash The Company considers cash and all highly liquid investments with an original maturity of three months or less at date of purchase to be cash and cash equivalents. Restricted cash includes cash and highly liquid instruments that are used as collateral for stand-alone letter of credit agreements related to normal business transactions. These agreements require the Company to maintain specified amounts of cash as collateral in segregated accounts to support the letters of credit issued thereunder, which will affect the amount of cash the Company has available for other uses. Credit Risk Financial instruments that potentially subject the Company to concentrations of credit risk consist principally of cash, cash equivalents and investments. The Company manages the credit risk associated with cash equivalents and investments by investing with high-quality institutions and, by policy, limiting investments only to those which meet prescribed investment guidelines. The Company maintains cash accounts that exceed federally insured limits. The Company has not experienced any losses from maintaining cash accounts in excess of such limits. Management believes that it is not exposed to any significant risks on its cash and cash equivalent accounts. The following table provides a reconciliation of cash, cash equivalents and restricted cash reported within the condensed consolidated balance sheets to the condensed consolidated statements of cash flows as of March 25, 2023, March 26, 2022 and September 24, 2022, respectively. March 25, 2023 March 26, 2022 September 24, 2022 (in thousands) Cash and cash equivalents $ 60,607 $ 54,082 $ 177,442 Restricted cash 13,475 12,676 14,742 Total cash, cash equivalents and restricted cash $ 74,082 $ 66,758 $ 192,184 Allowance for Credit Losses and Customer Allowances The Company’s trade accounts receivable are recorded at net realizable value, which includes an allowance for estimated credit losses, as well as allowances for contractual customer deductions accounted for as variable consideration. The Company maintains an allowance for credit losses related to its trade accounts receivable associated with future expected credit losses resulting from the inability of its customers to make required payments. The Company estimates the allowance based upon historical bad debts, current customer receivable balances and the customer’s financial condition. The allowance is adjusted to reflect changes in current and forecasted macroeconomic conditions. The Company’s estimate of credit losses includes expected current and future economic and market conditions. Revenue Recognition Revenue Recognition and Nature of Products and Services The Company manufactures, markets and distributes a wide variety of pet and garden products to wholesalers, distributors and retailers, primarily in the United States. The majority of the Company’s revenue is generated from the sale of finished pet and garden products. The Company also recognizes a minor amount of non-product revenue (approximately one percent of consolidated net sales) comprising third-party logistics services, merchandising services and royalty income from sales-based licensing arrangements. Product and non-product revenue is recognized when performance obligations under the terms of the contracts with customers are satisfied. The Company recognizes product revenue when control over the finished goods transfers to its customers, which generally occurs upon shipment to, or receipt at, customers’ locations, as determined by the specific terms of the contract. These revenue arrangements generally have single performance obligations. Non-product revenue is recognized as the services are provided to the customer in the case of third-party logistics services and merchandising services, or as third-party licensee sales occur for royalty income. Revenue, which includes shipping and handling charges billed to the customer, is reported net of variable consideration and consideration payable to our customers, including applicable discounts, returns, allowances, trade promotion, unsaleable product, consumer coupon redemption and rebates. Shipping and handling costs that occur before the customer obtains control of the goods are deemed to be fulfillment activities and are accounted for as fulfillment costs. Key sales terms are established on a frequent basis such that most customer arrangements and related incentives have a one year or shorter duration. As such, the Company does not capitalize contract inception costs. The Company generally does not have unbilled receivables at the end of a period. Deferred revenues are not material and primarily include advance payments for services that have yet to be rendered. The Company does not receive noncash consideration for the sale of goods. Amounts billed and due from our customers are classified as receivables and require payment on a short-term basis; therefore, the Company does not have any significant financing components. Sales Incentives and Other Promotional Programs The Company routinely offers sales incentives and discounts through various regional and national programs to our customers and consumers. These programs include product discounts or allowances, product rebates, product returns, one-time or ongoing trade-promotion programs with customers and consumer coupon programs that require the Company to estimate and accrue the expected costs of such programs. The costs associated with these activities are accounted for as reductions to the transaction price of the Company’s products and are, therefore, recorded as reductions to gross sales at the time of sale. The Company bases its estimates of incentive costs on historical trend experience with similar programs, actual incentive terms per customer contractual obligations and expected levels of performance of trade promotions, utilizing customer and sales organization inputs. The Company maintains liabilities at the end of each period for the estimated incentive costs incurred but unpaid for these programs. Differences between estimated and actual incentive costs are generally not material and are recognized in earnings in the period such differences are determined. Reserves for product returns, accrued rebates and promotional accruals are included in the condensed consolidated balance sheets as part of accrued expenses, and the value of inventory associated with reserves for sales returns is included within prepaid expenses and other current assets on the condensed consolidated balance sheets. Leases The Company determines whether an arrangement contains a lease at inception by determining if the contract conveys the right to control the use of identified property, plant or equipment for a period of time in exchange for consideration and other facts and circumstances. Long-term operating lease right-of-use ("ROU") assets and current and long-term operating lease liabilities are presented separately in the condensed consolidated balance sheets. Finance lease ROU assets are presented in property, plant and equipment, net, and the related finance liabilities are presented with current and long-term debt in the condensed consolidated balance sheets. Lease ROU assets represent the Company's right to use an underlying asset for the lease term, and lease liabilities represent the Company's obligation to make lease payments arising from the lease. ROU assets are calculated based on the lease liability adjusted for any lease payments paid to the lessor at or before the commencement date and excludes any lease incentives received from the lessor. Lease liabilities are recognized based on the present value of the future minimum lease payments over the lease term. The lease term may include options to extend or terminate the lease when it is reasonably certain that the Company will exercise that option. As the Company's leases typically do not contain a readily determinable implicit rate, the Company determines the present value of the lease liability using its incremental borrowing rate at the lease commencement date based on the lease term on a collateralized basis. Variable lease payments are expensed as incurred and include certain non-lease components, such as maintenance and other services provided by the lessor, and other charges included in the lease, as applicable. Non-lease components and the lease components to which they relate are accounted for as a single lease component, as the Company has elected to combine lease and non-lease components for all classes of underlying assets. Amortization of ROU lease assets is calculated on a straight-line basis over the lease term with the expense recorded in cost of sales or selling, general and administrative expenses, depending on the nature of the leased item. Interest expense is recorded over the lease term and is recorded in interest expense (based on a front-loaded interest expense pattern) for finance leases and is recorded in cost of sales or selling, general and administrative expenses (on a straight-line basis) for operating leases. All operating lease cash payments and interest on finance leases are recorded within cash flows from operating activities and all finance lease principal payments are recorded within cash flows from financing activities in the condensed consolidated statements of cash flows. Recent Accounting Pronouncements Recently Issued Accounting Updates There are no recent accounting pronouncements that are anticipated to have a material impact on the Company's condensed consolidated financial statements. |
Fair Value Measurements
Fair Value Measurements | 6 Months Ended |
Mar. 25, 2023 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | Fair Value Measurements ASC 820 establishes a single authoritative definition of fair value, a framework for measuring fair value and expands disclosure of fair value measurements. ASC 820 requires financial assets and liabilities to be categorized based on the inputs used to calculate their fair values as follows: Level 1 - Quoted prices in active markets for identical assets or liabilities. Level 2 - Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly. Level 3 - Unobservable inputs for the asset or liability, which reflect the Company’s own assumptions about the assumptions that market participants would use in pricing the asset or liability (including assumptions about risk). The Company’s financial instruments include cash and equivalents, short term investments consisting of bank certificates of deposit, accounts receivable and payable, derivative instruments, short-term borrowings, and accrued liabilities. The carrying amount of these instruments approximates fair value because of their short-term nature. Assets and Liabilities Measured at Fair Value on a Recurring Basis The Company's financial assets and liabilities measured at fair value on a recurring basis consist of contingent consideration within Level 3 of the fair value hierarchy. Such amounts are not material for all periods presented. Assets and Liabilities Measured at Fair Value on a Non-Recurring Basis The Company measures certain non-financial assets and liabilities, including long-lived assets, goodwill and intangible assets, at fair value on a non-recurring basis. Fair value measurements of non-financial assets and non-financial liabilities are used primarily in the impairment analyses of long-lived assets, goodwill and other intangible assets. During the periods ended March 25, 2023 and March 26, 2022, the Company was not required to measure any significant non-financial assets and liabilities at fair value. Fair Value of Other Financial Instruments In April 2021, the Company issued $400 million aggregate principal amount of 4.125% senior notes due April 2031 (the "2031 Notes"). The estimated fair value of the Company's 2031 Notes as of March 25, 2023, March 26, 2022 and September 24, 2022 was $334.0 million, $359.2 million and $327.6 million, respectively, compared to a carrying value of $395.1 million, $394.5 million and $394.8 million, respectively. In October 2020, the Company issued $500 million aggregate principal amount of 4.125% senior notes due October 2030 (the "2030 Notes"). The estimated fair value of the Company's 2030 Notes as of March 25, 2023, March 26, 2022 and September 24, 2022 was $426.3 million, $452.5 million and $407.6 million, respectively, compared to a carrying value of $494.0 million, $493.2 million and $493.6 million, respectively. In December 2017, the Company issued $300 million aggregate principal amount of 5.125% senior notes due February 2028 (the "2028 Notes"). The estimated fair value of the Company's 2028 Notes as of March 25, 2023, March 26, 2022 and September 24, 2022 was $281.9 million, $296.8 million and $272.2 million, respectively, compared to a carrying value of $297.7 million, $297.3 million and $297.5 million, respectively. The estimated fair value is based on quoted market prices for these notes, which are Level 1 inputs within the fair value hierarchy. |
Inventories, net
Inventories, net | 6 Months Ended |
Mar. 25, 2023 | |
Inventory Disclosure [Abstract] | |
Inventories, net | Inventories, net Inventories, net of allowance for obsolescence, consist of the following: March 25, 2023 March 26, 2022 September 24, 2022 (in thousands) Raw materials $ 295,071 $ 249,793 $ 266,695 Work in progress 190,526 99,157 99,842 Finished goods 454,464 511,284 528,481 Supplies 26,839 27,817 42,982 Total inventories, net $ 966,900 $ 888,051 $ 938,000 |
Goodwill
Goodwill | 6 Months Ended |
Mar. 25, 2023 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill | GoodwillThe Company tests goodwill for impairment annually (as of the first day of the fourth fiscal quarter), or whenever events occur or circumstances change that would more likely than not reduce the fair value of a reporting unit below its carrying amount, by first assessing qualitative factors to determine whether it is more likely than not the fair value of the reporting unit is less than its carrying amount. The qualitative assessment evaluates factors including macro-economic conditions, industry-specific and company-specific considerations, legal and regulatory environments and historical performance. If it is determined that it is more likely than not the fair value of the reporting unit is greater than its carrying amount, it is unnecessary to perform the quantitative goodwill impairment test. If it is determined that it is more likely than not that the fair value of the reporting unit is less than its carrying amount, the quantitative test is performed to identify potential goodwill impairment. Based on certain circumstances, the Company may elect to bypass the qualitative assessment and proceed directly to performing the quantitative goodwill impairment test, which compares the estimated fair value of our reporting units to their related carrying values, including goodwill. Impairment is indicated if the estimated fair value of the reporting unit is less than its carrying value, and an impairment charge is recognized for the differential. The Company’s goodwill impairment analysis also includes a comparison of the aggregate estimated fair value of its two reporting units to the Company’s total market capitalization. No impairment of goodwill was recorded for the six months ended March 25, 2023 and March 26, 2022. |
Other Intangible Assets
Other Intangible Assets | 6 Months Ended |
Mar. 25, 2023 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Other Intangible Assets | Other Intangible Assets The following table summarizes the components of gross and net acquired intangible assets: Gross Accumulated Accumulated Net (in millions) March 25, 2023 Marketing-related intangible assets – amortizable $ 22.1 $ (21.1) $ — $ 1.0 Marketing-related intangible assets – nonamortizable 252.5 — (26.0) 226.5 Total 274.6 (21.1) (26.0) 227.5 Customer-related intangible assets – amortizable 416.4 (133.1) (2.5) 280.8 Other acquired intangible assets – amortizable 39.7 (28.6) — 11.1 Other acquired intangible assets – nonamortizable 7.1 — (1.2) 5.9 Total 46.8 (28.6) (1.2) 17.1 Total other intangible assets, net $ 737.8 $ (182.8) $ (29.8) $ 525.3 Gross Accumulated Accumulated Net (in millions) March 26, 2022 Marketing-related intangible assets – amortizable $ 22.1 $ (19.8) $ — $ 2.2 Marketing-related intangible assets – nonamortizable 218.2 — (26.0) 192.2 Total 240.3 (19.8) (26.0) 194.4 Customer-related intangible assets – amortizable 386.4 (100.2) (2.5) 283.7 Other acquired intangible assets – amortizable 39.7 (24.5) — 15.2 Other acquired intangible assets – nonamortizable 7.1 — (1.2) 5.9 Total 46.8 (24.5) (1.2) 21.1 Total other intangible assets, net $ 673.5 $ (144.5) $ (29.8) $ 499.3 Gross Accumulated Accumulated Net (in millions) September 24, 2022 Marketing-related intangible assets – amortizable $ 22.1 $ (20.5) $ — $ 1.5 Marketing-related intangible assets – nonamortizable 252.5 — (26.0) 226.5 Total 274.6 (20.5) (26.0) 228.0 Customer-related intangible assets – amortizable 416.4 (117.8) (2.5) 296.1 Other acquired intangible assets – amortizable 39.7 (26.6) — 13.2 Other acquired intangible assets – nonamortizable 7.1 — (1.2) 5.9 Total 46.8 (26.6) (1.2) 19.1 Total other intangible assets, net $ 737.8 $ (164.9) $ (29.8) $ 543.2 Other acquired intangible assets include contract-based and technology-based intangible assets. The Company evaluates long-lived assets, including amortizable and indefinite-lived intangible assets, for impairment whenever events or changes in circumstances indicate the carrying value may not be recoverable. The Company evaluates indefinite-lived intangible assets on an annual basis. Factors indicating the carrying value of the Company’s amortizable intangible assets may not be recoverable were not present in the six months ended March 25, 2023, and accordingly, no impairment testing was performed on these assets. The Company amortizes its acquired intangible assets with definite lives over periods ranging from two years to 25 years; over weighted average remaining lives of two years for marketing-related intangibles, 12 years for customer-related intangibles and six years for |
Long-Term Debt
Long-Term Debt | 6 Months Ended |
Mar. 25, 2023 | |
Debt Disclosure [Abstract] | |
Long-Term Debt | Long-Term Debt Long-term debt consists of the following: March 25, 2023 March 26, 2022 September 24, 2022 (in thousands) Senior notes, interest at 5.125%, payable semi-annually, principal due February 2028 $ 300,000 $ 300,000 $ 300,000 Senior notes, interest at 4.125%, payable semi-annually, principal due October 2030 500,000 500,000 500,000 Senior notes, interest at 4.125%, payable semi-annually, principal due April 2031 400,000 400,000 400,000 Unamortized debt issuance costs (13,174) (15,051) (14,116) Net carrying value 1,186,826 1,184,949 1,185,884 Asset-based revolving credit facility, interest at LIBOR plus a margin of 1.00% to 1.50% or Base Rate plus a margin of 0.0% to 0.50%, final maturity December 2026. 25,000 — — Other notes payable 497 885 678 Total 1,212,323 1,185,834 1,186,562 Less current portion (270) (378) (317) Long-term portion $ 1,212,053 $ 1,185,456 $ 1,186,245 Senior Notes Issuance of $400 million 4.125% Senior Notes due 2031 On April 30, 2021, the Company issued $400 million aggregate principal amount of 4.125% senior notes due April 2031 (the "2031 Notes"). The Company used a portion of the net proceeds from the offering to repay all outstanding borrowings under its Amended Credit Facility, with the remainder used for general corporate purposes. The Company incurred approximately $6 million of debt issuance costs in conjunction with this issuance, which included underwriter fees and legal, accounting and rating agency expenses. The debt issuance costs are being amortized over the term of the 2031 Notes. The 2031 Notes require semi-annual interest payments on April 30 and October 30. The 2031 Notes are unconditionally guaranteed on a senior basis by each of the Company's existing and future domestic restricted subsidiaries which are borrowers under or guarantors of Central's Amended Credit Facility. The 2031 Notes were issued in a private placement under Rule 144A and will not be registered under the Securities Act of 1933. The Company may redeem some or all of the 2031 Notes at any time, at its option, prior to April 30, 2026 at the principal amount plus a "make whole" premium. At any time prior to April 30, 2024, the Company may also redeem, at its option, up to 40% of the notes with the proceeds of certain equity offerings at a redemption price of 104.125% of the principal amount of the notes. The Company may redeem some or all of the 2031 Notes at the Company’s option, at any time on or after April 30, 2026 for 102.063%, on or after April 30, 2027 for 101.375%, on or after April 30, 2028 for 100.688% and on or after April 30, 2029 for 100.0%, plus accrued and unpaid interest. The holders of the 2031 Notes have the right to require the Company to repurchase all or a portion of the 2031 Notes at a purchase price equal to 101% of the principal amount of the notes repurchased, plus accrued and unpaid interest, upon the occurrence of specific kinds of changes of control. The 2031 Notes contain customary high yield covenants, including covenants limiting debt incurrence and restricted payments, subject to certain baskets and exceptions. The Company was in compliance with all financial covenants as of March 25, 2023. Issuance of $500 million 4.125% Senior Notes due 2030 In October 2020, the Company issued $500 million aggregate principal amount of 4.125% senior notes due October 2030 (the "2030 Notes"). In November 2020, the Company used a portion of the net proceeds to redeem all of its outstanding 6.125% senior notes due November 2023 (the "2023 Notes") at a redemption price of 101.531% plus accrued and unpaid interest, and to pay related fees and expenses, with the remainder used for general corporate purposes. The Company incurred approximately $8.0 million of debt issuance costs associated with this transaction, which included underwriter fees and legal, accounting and rating agency expenses. The debt issuance costs are being amortized over the term of the 2030 Notes. The 2030 Notes require semiannual interest payments on October 15 and April 15. The 2030 Notes are unconditionally guaranteed on a senior basis by each of the Company's existing and future domestic restricted subsidiaries which are borrowers under or guarantors of the Company's senior secured revolving credit facility or guarantee the Company's other debt. The Company may redeem some or all of the 2030 Notes at any time, at its option, prior to October 15, 2025 at a price equal to 100% of the principal amount plus a “make-whole” premium. Prior to October 15, 2023, the Company may redeem up to 40% of the original aggregate principal amount of the notes with the proceeds of certain equity offerings at a redemption price of 104.125% of the principal amount of the notes. The Company may redeem some or all of the 2030 Notes, at its option, in whole or in part, at any time on or after October 15, 2025 for 102.063%, on or after October 15, 2026 for 101.375%, on or after October 15, 2027 for 100.688% and on or after October 15, 2028 for 100.0%, plus accrued and unpaid interest. The holders of the 2030 Notes have the right to require the Company to repurchase all or a portion of the 2030 Notes at a purchase price equal to 101.0% of the principal amount of the notes repurchased, plus accrued and unpaid interest upon the occurrence of a change of control. The 2030 Notes contain customary high yield covenants, including covenants limiting debt incurrence and restricted payments, subject to certain baskets and exceptions. The Company was in compliance with all financial covenants as of March 25, 2023. $300 million 5.125% Senior Notes due 2028 On December 14, 2017, the Company issued $300 million aggregate principal amount of 5.125% senior notes due February 2028 (the "2028 Notes"). The Company used the net proceeds from the offering to finance acquisitions and for general corporate purposes. The Company incurred approximately $4.8 million of debt issuance costs in conjunction with this transaction, which included underwriter fees and legal, accounting and rating agency expenses. The debt issuance costs are being amortized over the term of the 2028 Notes. The 2028 Notes require semiannual interest payments on February 1 and August 1. The 2028 Notes are unconditionally guaranteed on a senior basis by the Company's existing and future domestic restricted subsidiaries which are borrowers under or guarantors of the Company's senior secured revolving credit facility, or which guarantee the Company's other debt. The Company may redeem some or all of the 2028 Notes at any time, at its option, prior to January 1, 2024 at the principal amount plus a “make whole” premium. The Company may redeem some or all of the 2028 Notes, at its option, at any time on or after January 1, 2024 for 101.708%, on or after January 1, 2025 for 100.854%, and on or after January 1, 2026 for 100.0%, plus accrued and unpaid interest. The holders of the 2028 Notes have the right to require the Company to repurchase all or a portion of the 2028 Notes at a purchase price equal to 101.0% of the principal amount of the notes repurchased, plus accrued and unpaid interest upon the occurrence of a change of control. The 2028 Notes contain customary high yield covenants, including covenants limiting debt incurrence and restricted payments, subject to certain baskets and exceptions. The Company was in compliance with all financial covenants as of March 25, 2023. Asset-Based Loan Facility Amendment On December 16, 2021, the Company entered into a Third Amended and Restated Credit Agreement (“Amended Credit Agreement”). The Amended Credit Agreement amended and restated the previous credit agreement dated September 27, 2019 (the "Predecessor Credit Agreement"), and provides for a $750 million principal amount senior secured asset-based revolving credit facility, with up to an additional $400 million principal amount available with the consent of the Lenders, as defined, if the Company exercises the uncommitted accordion feature set forth therein (collectively, the “Amended Credit Facility”). The Amended Credit Facility matures on December 16, 2026. The Company may borrow, repay and reborrow amounts under the Amended Credit Facility until its maturity date, at which time all amounts outstanding under the Amended Credit Facility must be repaid in full. The Amended Credit Facility is subject to a borrowing base that is calculated using a formula based upon eligible receivables and inventory, and at the Company's election, eligible real property, minus certain reserves. Proceeds of the Amended Credit Facility will be used for general corporate purposes. At March 25, 2023, the Company's applicable borrowing base calculation supported access to approximately $635 million under the Amended Credit Facility. The Amended Credit Facility includes a $50 million sublimit for the issuance of standby letters of credit and a $75 million sublimit for short-notice borrowings. As of March 25, 2023, there were borrowings of $25 million outstanding and no letters of credit outstanding under the Amended Credit Facility. Outside the Amended Credit Facility, there were other letters of credit of $1.3 million outstanding as of March 25, 2023. Borrowings under the Amended Credit Facility bear interest at an index based on LIBOR (which will not be less than 0.00%) or, at the option of the Company, the Base Rate, plus, in either case, an applicable margin based on the Company's usage under the credit facility. Base Rate is defined as the highest of (a) the Truist prime rate, (b) the Federal Funds Rate plus 0.50%, (c) one-month LIBOR plus 1.00% and (d) 0.00%. The applicable margin for LIBOR-based borrowings fluctuates between 1.00%-1.50%, and was 1.00% as of March 25, 2023, and the applicable margin for Base Rate borrowings fluctuates between 0.00%-0.50%, and was 0% as of March 25, 2023. An unused line fee is payable quarterly in respect of the total amount of the unutilized Lenders’ commitments and short-notice borrowings under the Amended Credit Facility. Letter of credit fees at the applicable margin on the average undrawn and unreimbursed amount of letters of credit are payable quarterly and a facing fee of 0.125% is payable quarterly for the stated amount of each letter of credit. The Company is also required to pay certain fees to the administrative agent under the Amended Credit Facility. The Amended Credit Facility provides for the transition from LIBOR to Secured Overnight Financing Rate ("SOFR"). As of March 25, 2023, the applicable interest rate related to Base Rate borrowings was 8.0%, and the applicable interest rate related to one-month LIBOR-based borrowings was 5.8%. The Company incurred approximately $2.4 million of debt issuance costs in conjunction with this transaction, which included lender fees and legal expenses. The debt issuance costs are being amortized over the term of the Amended Credit Facility. The Amended Credit Facility contains customary covenants, including financial covenants which require the Company to maintain a minimum fixed charge coverage ratio of 1:1 upon triggered quarterly testing (e.g. when availability falls below certain thresholds established in the agreement), reporting requirements and events of default. The Amended Credit Facility is secured by substantially all assets of the borrowing parties, including (i) pledges of 100% of the stock or other equity interest of each domestic subsidiary that is directly owned by such entity and (ii) 65% of the stock or other equity interest of each foreign subsidiary that is directly owned by such entity, in each case subject to customary exceptions. The Company was in compliance with all financial covenants under the Amended Credit Facility as of March 25, 2023. |
Supplemental Equity Information
Supplemental Equity Information | 6 Months Ended |
Mar. 25, 2023 | |
Equity [Abstract] | |
Supplemental Equity Information | Supplemental Equity Information The following table provides a summary of the changes in the carrying amounts of equity attributable to controlling interest and noncontrolling interest through the six months ended March 25, 2023 and March 26, 2022. Controlling Interest Common Class A Class Additional Retained Accumulated Total Noncontrolling Total (in thousands) Balance September 24, 2022 $ 113 $ 413 $ 16 $ 582,056 $ 755,253 $ (4,145) $ 1,333,706 $ 1,006 $ 1,334,712 Comprehensive loss — — — — (8,433) 782 (7,651) (416) (8,067) Amortization of share-based awards — — — 4,647 — — 4,647 — 4,647 Restricted share activity, including net share settlement — — — (590) — — (590) — (590) Issuance of common stock, including net share settlement of stock options — 1 — 1,707 — — 1,708 — 1,708 Repurchase of stock — (2) — (2,693) (6,271) — (8,966) — (8,966) Balance December 24, 2022 $ 113 $ 412 $ 16 $ 585,127 $ 740,549 $ (3,363) $ 1,322,854 $ 590 $ 1,323,444 Comprehensive income — — — — 48,115 (238) 47,877 563 48,440 Amortization of share-based awards — — — 5,015 — — 5,015 — 5,015 Restricted share activity, including net share settlement — 1 — (3,115) — — (3,114) — (3,114) Repurchase of stock (1) (1) — (807) (1,888) — (2,697) — (2,697) Issuance of common stock, including net share settlement of stock options — 1 — 1,158 — — 1,159 — 1,159 Balance March 25, 2023 $ 112 $ 413 $ 16 $ 587,378 $ 786,776 $ (3,601) $ 1,371,094 $ 1,153 $ 1,372,247 Controlling Interest Common Stock Class A Common Stock Class B Stock Additional Paid In Capital Retained Earnings Accumulated Other Comprehensive Income (Loss) Total Noncontrolling Interest Total (in thousands) Balance September 25, 2021 $ 113 $ 423 $ 16 $ 576,446 $ 646,082 $ (831) $ 1,222,249 $ 1,292 $ 1,223,541 Comprehensive income — — — — 9,009 (442) 8,567 187 8,754 Amortization of share-based awards — — — 3,886 — — 3,886 — 3,886 Restricted share activity, including net share settlement — — — (705) — — (705) — (705) Repurchase of stock — (1) — (1,600) (5,059) — (6,660) — (6,660) Issuance of common stock, including net share settlement of stock options — — — 890 — — 890 — 890 Distribution to Noncontrolling interest — — — — — — — (806) (806) Balance December 25, 2021 $ 113 $ 422 $ 16 $ 578,917 $ 650,032 $ (1,273) $ 1,228,227 $ 673 $ 1,228,900 Comprehensive income — — — — 69,713 570 70,283 573 70,856 Amortization of share-based awards — — — 4,624 — — 4,624 — 4,624 Restricted share activity, including net share settlement — 2 — (923) — — (921) — (921) Repurchase of stock — (2) (2,372) (7,062) — (9,436) (9,436) Issuance of common stock, including net share settlement of stock options — — — 309 — — 309 — 309 Other — — — — — — — 1 1 Balance March 26, 2022 $ 113 $ 422 $ 16 $ 580,555 $ 712,683 $ (703) $ 1,293,086 $ 1,247 $ 1,294,333 |
Stock-Based Compensation
Stock-Based Compensation | 6 Months Ended |
Mar. 25, 2023 | |
Share-Based Payment Arrangement [Abstract] | |
Stock-Based Compensation | Stock-Based CompensationThe Company recognized share-based compensation expense of $13.3 million and $11.5 million for the six months ended March 25, 2023 and March 26, 2022, respectively, as a component of selling, general and administrative expenses. The tax benefit associated with share-based compensation expense for the six months ended March 25, 2023 and March 26, 2022 was $3.2 million and $2.7 million, respectively. |
Earnings Per Share
Earnings Per Share | 6 Months Ended |
Mar. 25, 2023 | |
Earnings Per Share [Abstract] | |
Earnings Per Share | Earnings Per Share The following is a reconciliation of the numerators and denominators of the basic and diluted per share computations for income from continuing operations. Three Months Ended Six Months Ended March 25, 2023 March 25, 2023 Income Shares Per Share Income Shares Per Share (in thousands, except per share amounts) Basic EPS: Net income available to common shareholders $ 48,115 52,443 $ 0.92 $ 39,682 52,461 $ 0.76 Effect of dilutive securities: Options to purchase common stock — 310 (0.01) — 300 (0.01) Restricted shares — 690 (0.01) — 687 (0.01) Performance stock units — 91 — 72 — Diluted EPS: Net income available to common shareholders $ 48,115 53,534 $ 0.90 $ 39,682 53,520 $ 0.74 Three Months Ended Six Months Ended March 26, 2022 March 26, 2022 Income Shares Per Share Income Shares Per Share (in thousands, except per share amounts) Basic EPS: Net income available to common shareholders $ 69,713 53,458 $ 1.30 $ 78,722 53,475 $ 1.47 Effect of dilutive securities: Options to purchase common stock — 515 (0.01) — 572 (0.01) Restricted shares — 749 (0.02) — 771 (0.02) Diluted EPS: Net income available to common shareholders $ 69,713 54,722 $ 1.27 $ 78,722 54,818 $ 1.44 Options to purchase 2.0 million shares of Class A common stock at prices ranging from $21.37 to $51.37 per share were outstanding at March 25, 2023, and options to purchase 2.4 million shares of Class A common stock at prices ranging from $13.82 to $51.37 per share were outstanding at March 26, 2022. For the three months ended March 25, 2023 and March 26, 2022, approximately 0.6 million and 0.4 million options outstanding, respectively, were not included in the computation of diluted earnings per share because the option exercise prices were greater than the average market price of the common shares and therefore, the effect of including these options would be antidilutive. For the six months ended March 25, 2023 and March 26, 2022, approximately 0.6 million and 21 thousand options outstanding, respectively, were not included in the computation of diluted earnings per share because the option exercise prices were greater than the average market price of the common shares and therefore, the effect of including these options would be antidilutive. |
Segment Information
Segment Information | 6 Months Ended |
Mar. 25, 2023 | |
Segment Reporting [Abstract] | |
Segment Information | Segment Information Management has determined that the Company has two operating segments, which are also reportable segments based on the level at which the Chief Operating Decision Maker reviews the results of operations to make decisions regarding performance assessment and resource allocation. These operating segments are the Pet segment and the Garden segment. Substantially all of the Company's assets and operations relate to its business in the United States. Financial information relating to the Company's business segments is presented in the table below. Three Months Ended Six Months Ended March 25, 2023 March 26, 2022 March 25, 2023 March 26, 2022 (in thousands) Net sales: Pet segment $ 475,203 $ 497,640 $ 891,023 $ 933,642 Garden segment 433,801 456,730 $ 645,644 682,126 Total net sales $ 909,004 $ 954,370 $ 1,536,667 $ 1,615,768 Operating income (loss) Pet segment 55,255 60,645 94,810 105,896 Garden segment 49,619 70,511 38,799 76,568 Corporate (26,833) (24,311) (55,162) (49,405) Total operating income 78,041 106,845 78,447 133,059 Interest expense - net (14,690) (14,702) (28,466) (29,110) Other income (expense) 595 (369) 2,294 (578) Income tax expense 15,268 21,488 12,446 23,889 Income including noncontrolling interest 48,678 70,286 39,829 79,482 Net income attributable to noncontrolling interest 563 573 147 760 Net income attributable to Central Garden & Pet Company $ 48,115 $ 69,713 $ 39,682 $ 78,722 Depreciation and amortization: Pet segment $ 10,474 $ 9,539 $ 20,586 $ 19,088 Garden segment 10,818 7,719 21,660 17,339 Corporate 817 989 1,555 2,022 Total depreciation and amortization $ 22,109 $ 18,247 $ 43,801 $ 38,449 March 25, 2023 March 26, 2022 September 24, 2022 (in thousands) Assets: Pet segment $ 1,058,549 $ 1,101,814 $ 1,069,167 Garden segment 1,620,907 1,634,158 1,405,802 Corporate 671,342 613,286 807,033 Total assets $ 3,350,798 $ 3,349,258 $ 3,282,002 Goodwill (included in corporate assets above): Pet segment $ 277,067 $ 277,067 $ 277,067 Garden segment 269,369 234,906 269,369 Total goodwill $ 546,436 $ 511,973 $ 546,436 The tables below present the Company's disaggregated revenues by segment: Three Months Ended March 25, 2023 Six Months Ended March 25, 2023 Pet Segment Garden Segment Total Pet Segment Garden Segment Total (in millions) (in millions) Other pet products $ 194.1 $ — $ 194.1 $ 333.6 $ — $ 333.6 Dog and cat products 126.7 — 126.7 260.8 — 260.8 Other manufacturers' products 103.0 95.7 198.7 206.4 141.8 348.2 Wild bird products 51.4 81.5 132.9 90.2 141.0 231.3 Other garden supplies — 256.6 256.6 — 362.8 362.8 Total $ 475.2 $ 433.8 $ 909.0 $ 891.0 $ 645.6 $ 1,536.7 Three Months Ended March 26, 2022 Six Months Ended March 26, 2022 Pet Segment Garden Segment Total Pet Segment Garden Segment Total (in millions) (in millions) Other pet products $ 223.7 $ — $ 223.7 $ 377.4 $ — $ 377.4 Dog and cat products 129.3 — 129.3 274.2 — 274.2 Other manufacturers' products 98.5 95.4 193.9 203.0 144.8 347.8 Wild bird products 46.1 72.8 118.9 79.0 127.5 206.5 Other garden supplies — 288.5 288.5 — 409.8 409.8 Total $ 497.6 $ 456.7 $ 954.3 $ 933.6 $ 682.1 $ 1,615.7 |
Contingencies
Contingencies | 6 Months Ended |
Mar. 25, 2023 | |
Commitments and Contingencies Disclosure [Abstract] | |
Contingencies | Contingencies The Company may from time to time become involved in legal proceedings in the ordinary course of business. Currently, the Company is not a party to any legal proceedings the resolution of which management believes could have a material effect on the Company’s financial position or results of operations with the potential exception of the proceeding below. In 2012, Nite Glow Industries, Inc and its owner, Marni Markell, (“Nite Glow”) filed suit in the U.S. District Court for New Jersey against the Company alleging that the applicator developed and used by the Company for certain of its branded topical flea and tick products infringes a patent held by Nite Glow and asserted related claims for breach of contract and misappropriation of confidential information based on the terms of a Non-Disclosure Agreement. On June 27, 2018, a jury returned a verdict in favor of Nite Glow on each of the three claims and awarded damages of approximately $12.6 million. The court ruled on post-trial motions in early June 2020, reducing the judgment amount to $12.4 million and denying the plaintiff's request for attorneys' fees. The Company filed its notice of appeal and the plaintiffs cross-appealed. On July 14, 2021, the Federal Circuit Court of Appeals issued its decision on the appeal. The Federal Circuit concluded that the Company did not infringe plaintiff's patent and determined that the breach of contract claim raised no non-duplicative damages and should be dismissed. The court affirmed the jury's liability verdict on the misappropriation of confidential information claim but ordered a new trial on damages on that single claim limited to the "head start" benefit, if any, generated by the confidential information. The Company intends to vigorously pursue its defenses in the future proceedings and believes that it will prevail on the merits as to the head start damages issue. While the Company believes that the ultimate resolution of this matter will not have a material impact on the Company's consolidated financial statements, the outcome of litigation is inherently uncertain and the final resolution of this matter may result in expense to the Company in excess of management's expectations. During fiscal 2013, the Company received notices from several states stating that they have appointed an agent to conduct an examination of the books and records of the Company to determine whether it has complied with state unclaimed property laws. In addition to seeking unclaimed property subject to escheat laws, the states may seek interest, penalties and other relief. The examinations are continuing; as a result, the ultimate resolution and impact on the Company’s consolidated financial statements is uncertain. The Company has experienced, and may in the future experience, issues with products that may lead to product liability, recalls, withdrawals, replacements of products, or regulatory actions by governmental authorities. The Company has not experienced recent issues with products, the resolution of which, management believes would have a material effect on the Company’s financial position or results of operations. |
Subsequent Events
Subsequent Events | 6 Months Ended |
Mar. 25, 2023 | |
Subsequent Events [Abstract] | |
Subsequent Events | Subsequent Event In April 2023, the Company announced the closure of a leased manufacturing and distribution facility in Athens, Texas. This decision reflects the Company’s purposeful exit of low-margin private-label pet bed product lines and its efforts to achieve a simpler, more efficient manufacturing and distribution network leveraging the supply chain synergies of the Company’s cushion facilities. This facility closure is expected to result in a one-time charge to earnings of approximately $15 million in the Company’s fiscal third quarter, composed of charges for facilities closure, severance, inventory liquidation and related intangibles, the majority of which will be non-cash. |
Basis of Presentation (Policies
Basis of Presentation (Policies) | 6 Months Ended |
Mar. 25, 2023 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis of Presentation | Basis of Presentation The condensed consolidated balance sheets of Central Garden & Pet Company and subsidiaries (the “Company” or “Central”) as of March 25, 2023 and March 26, 2022, the condensed consolidated statements of operations and the condensed consolidated statements of comprehensive income for the three and six months ended March 25, 2023 and March 26, 2022, and the condensed consolidated statements of cash flows for the six months ended March 25, 2023 and March 26, 2022 have been prepared by the Company, without audit. In the opinion of management, the interim financial statements include all normal recurring adjustments necessary for a fair statement of the results for the interim periods presented. For the Company’s foreign businesses in the United Kingdom and Canada, the local currency is the functional currency. Assets and liabilities are translated using the exchange rate in effect at the balance sheet date. Income and expenses are translated at the average exchange rate for the period. Deferred taxes are not provided on translation gains and losses because the Company expects earnings of its foreign subsidiaries to be permanently reinvested. Transaction gains and losses are included in results of operations. Due to the seasonal nature of the Company’s garden business, the results of operations for the three and six months ended March 25, 2023 are not necessarily indicative of the operating results that may be expected for the entire fiscal year. These interim financial statements should be read in conjunction with the annual audited financial statements, accounting policies and financial notes thereto, included in the Company’s Annual Report on Form 10-K for the fiscal year ended September 24, 2022, which has previously been filed with the Securities and Exchange Commission. The September 24, 2022 balance sheet presented herein was derived from the audited financial statements. |
Noncontrolling Interest | Noncontrolling InterestNoncontrolling interest in the Company’s condensed consolidated financial statements represents the 20% interest not owned by Central in a consolidated subsidiary. Since the Company controls this subsidiary, its financial statements are consolidated with those of the Company, and the noncontrolling owner’s 20% share of the subsidiary’s net assets and results of operations is deducted and reported as noncontrolling interest on the consolidated balance sheets and as net income (loss) attributable to noncontrolling interest in the condensed consolidated statements of operations. |
Cash, Cash Equivalents and Restricted Cash | Cash, Cash Equivalents and Restricted Cash The Company considers cash and all highly liquid investments with an original maturity of three months or less at date of purchase to be cash and cash equivalents. Restricted cash includes cash and highly liquid instruments that are used as collateral for stand-alone letter of credit agreements related to normal business transactions. These agreements require the Company to maintain specified amounts of cash as collateral in segregated accounts to support the letters of credit issued thereunder, which will affect the amount of cash the Company has available for other uses. Credit Risk Financial instruments that potentially subject the Company to concentrations of credit risk consist principally of cash, cash equivalents and investments. The Company manages the credit risk associated with cash equivalents and investments by investing with high-quality institutions and, by policy, limiting investments only to those which meet prescribed investment guidelines. The Company maintains cash accounts that exceed federally insured limits. The Company has not experienced any losses from maintaining cash accounts in excess of such limits. Management believes that it is not exposed to any significant risks on its cash and cash equivalent accounts. |
Allowance for Credit Losses and Customer Allowances | Allowance for Credit Losses and Customer Allowances |
Revenue Recognition | Revenue Recognition Revenue Recognition and Nature of Products and Services The Company manufactures, markets and distributes a wide variety of pet and garden products to wholesalers, distributors and retailers, primarily in the United States. The majority of the Company’s revenue is generated from the sale of finished pet and garden products. The Company also recognizes a minor amount of non-product revenue (approximately one percent of consolidated net sales) comprising third-party logistics services, merchandising services and royalty income from sales-based licensing arrangements. Product and non-product revenue is recognized when performance obligations under the terms of the contracts with customers are satisfied. The Company recognizes product revenue when control over the finished goods transfers to its customers, which generally occurs upon shipment to, or receipt at, customers’ locations, as determined by the specific terms of the contract. These revenue arrangements generally have single performance obligations. Non-product revenue is recognized as the services are provided to the customer in the case of third-party logistics services and merchandising services, or as third-party licensee sales occur for royalty income. Revenue, which includes shipping and handling charges billed to the customer, is reported net of variable consideration and consideration payable to our customers, including applicable discounts, returns, allowances, trade promotion, unsaleable product, consumer coupon redemption and rebates. Shipping and handling costs that occur before the customer obtains control of the goods are deemed to be fulfillment activities and are accounted for as fulfillment costs. Key sales terms are established on a frequent basis such that most customer arrangements and related incentives have a one year or shorter duration. As such, the Company does not capitalize contract inception costs. The Company generally does not have unbilled receivables at the end of a period. Deferred revenues are not material and primarily include advance payments for services that have yet to be rendered. The Company does not receive noncash consideration for the sale of goods. Amounts billed and due from our customers are classified as receivables and require payment on a short-term basis; therefore, the Company does not have any significant financing components. Sales Incentives and Other Promotional Programs The Company routinely offers sales incentives and discounts through various regional and national programs to our customers and consumers. These programs include product discounts or allowances, product rebates, product returns, one-time or ongoing trade-promotion programs with customers and consumer coupon programs that require the Company to estimate and accrue the expected costs of such programs. The costs associated with these activities are accounted for as reductions to the transaction price of the Company’s products and are, therefore, recorded as reductions to gross sales at the time of sale. The Company bases its estimates of incentive costs on historical trend experience with similar programs, actual incentive terms per customer contractual obligations and expected levels of performance of trade promotions, utilizing customer and sales organization inputs. The Company maintains liabilities at the end of each period for the estimated incentive costs incurred but unpaid for these programs. Differences between estimated and actual incentive costs are generally not material and are recognized in earnings in the period such differences are determined. Reserves for product returns, accrued rebates and promotional accruals are included in the condensed consolidated balance sheets as part of accrued expenses, and the value of inventory associated with reserves for sales returns is included within prepaid expenses and other current assets on the condensed consolidated balance sheets. |
Leases | Leases The Company determines whether an arrangement contains a lease at inception by determining if the contract conveys the right to control the use of identified property, plant or equipment for a period of time in exchange for consideration and other facts and circumstances. Long-term operating lease right-of-use ("ROU") assets and current and long-term operating lease liabilities are presented separately in the condensed consolidated balance sheets. Finance lease ROU assets are presented in property, plant and equipment, net, and the related finance liabilities are presented with current and long-term debt in the condensed consolidated balance sheets. Lease ROU assets represent the Company's right to use an underlying asset for the lease term, and lease liabilities represent the Company's obligation to make lease payments arising from the lease. ROU assets are calculated based on the lease liability adjusted for any lease payments paid to the lessor at or before the commencement date and excludes any lease incentives received from the lessor. Lease liabilities are recognized based on the present value of the future minimum lease payments over the lease term. The lease term may include options to extend or terminate the lease when it is reasonably certain that the Company will exercise that option. As the Company's leases typically do not contain a readily determinable implicit rate, the Company determines the present value of the lease liability using its incremental borrowing rate at the lease commencement date based on the lease term on a collateralized basis. Variable lease payments are expensed as incurred and include certain non-lease components, such as maintenance and other services provided by the lessor, and other charges included in the lease, as applicable. Non-lease components and the lease components to which they relate are accounted for as a single lease component, as the Company has elected to combine lease and non-lease components for all classes of underlying assets. Amortization of ROU lease assets is calculated on a straight-line basis over the lease term with the expense recorded in cost of sales or selling, general and administrative expenses, depending on the nature of the leased item. Interest expense is recorded over the lease term and is recorded in interest expense (based on a front-loaded interest expense pattern) for finance leases and is recorded in cost of sales or selling, general and administrative expenses (on a straight-line basis) for operating leases. All operating lease cash payments and interest on finance leases are recorded within cash flows from operating activities and all finance lease principal payments are recorded within cash flows from financing activities in the condensed consolidated statements of cash flows. |
Recent Accounting Pronouncements | Recent Accounting Pronouncements Recently Issued Accounting Updates There are no recent accounting pronouncements that are anticipated to have a material impact on the Company's condensed consolidated financial statements. |
Fair Value Measurement | Fair Value Measurements ASC 820 establishes a single authoritative definition of fair value, a framework for measuring fair value and expands disclosure of fair value measurements. ASC 820 requires financial assets and liabilities to be categorized based on the inputs used to calculate their fair values as follows: Level 1 - Quoted prices in active markets for identical assets or liabilities. Level 2 - Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly. Level 3 - Unobservable inputs for the asset or liability, which reflect the Company’s own assumptions about the assumptions that market participants would use in pricing the asset or liability (including assumptions about risk). The Company’s financial instruments include cash and equivalents, short term investments consisting of bank certificates of deposit, accounts receivable and payable, derivative instruments, short-term borrowings, and accrued liabilities. The carrying amount of these instruments approximates fair value because of their short-term nature. |
Goodwill | GoodwillThe Company tests goodwill for impairment annually (as of the first day of the fourth fiscal quarter), or whenever events occur or circumstances change that would more likely than not reduce the fair value of a reporting unit below its carrying amount, by first assessing qualitative factors to determine whether it is more likely than not the fair value of the reporting unit is less than its carrying amount. The qualitative assessment evaluates factors including macro-economic conditions, industry-specific and company-specific considerations, legal and regulatory environments and historical performance. If it is determined that it is more likely than not the fair value of the reporting unit is greater than its carrying amount, it is unnecessary to perform the quantitative goodwill impairment test. If it is determined that it is more likely than not that the fair value of the reporting unit is less than its carrying amount, the quantitative test is performed to identify potential goodwill impairment. Based on certain circumstances, the Company may elect to bypass the qualitative assessment and proceed directly to performing the quantitative goodwill impairment test, which compares the estimated fair value of our reporting units to their related carrying values, including goodwill. Impairment is indicated if the estimated fair value of the reporting unit is less than its carrying value, and an impairment charge is recognized for the differential. The Company’s goodwill impairment analysis also includes a comparison of the aggregate estimated fair value of its two reporting units to the Company’s total market capitalization. No impairment of goodwill was recorded for the six months ended March 25, 2023 and March 26, 2022. |
Basis of Presentation Basis of
Basis of Presentation Basis of Presentation (Tables) | 6 Months Ended |
Mar. 25, 2023 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Schedule of Reconciliation of Cash and Cash Equivalents | The following table provides a reconciliation of cash, cash equivalents and restricted cash reported within the condensed consolidated balance sheets to the condensed consolidated statements of cash flows as of March 25, 2023, March 26, 2022 and September 24, 2022, respectively. March 25, 2023 March 26, 2022 September 24, 2022 (in thousands) Cash and cash equivalents $ 60,607 $ 54,082 $ 177,442 Restricted cash 13,475 12,676 14,742 Total cash, cash equivalents and restricted cash $ 74,082 $ 66,758 $ 192,184 |
Schedule of Reconciliation of Restricted Cash | The following table provides a reconciliation of cash, cash equivalents and restricted cash reported within the condensed consolidated balance sheets to the condensed consolidated statements of cash flows as of March 25, 2023, March 26, 2022 and September 24, 2022, respectively. March 25, 2023 March 26, 2022 September 24, 2022 (in thousands) Cash and cash equivalents $ 60,607 $ 54,082 $ 177,442 Restricted cash 13,475 12,676 14,742 Total cash, cash equivalents and restricted cash $ 74,082 $ 66,758 $ 192,184 |
Inventories, net (Tables)
Inventories, net (Tables) | 6 Months Ended |
Mar. 25, 2023 | |
Inventory Disclosure [Abstract] | |
Schedule of Inventories, Net of Allowance for Obsolescence | Inventories, net of allowance for obsolescence, consist of the following: March 25, 2023 March 26, 2022 September 24, 2022 (in thousands) Raw materials $ 295,071 $ 249,793 $ 266,695 Work in progress 190,526 99,157 99,842 Finished goods 454,464 511,284 528,481 Supplies 26,839 27,817 42,982 Total inventories, net $ 966,900 $ 888,051 $ 938,000 |
Other Intangible Assets (Tables
Other Intangible Assets (Tables) | 6 Months Ended |
Mar. 25, 2023 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of Gross and Net Acquired Intangible Assets | The following table summarizes the components of gross and net acquired intangible assets: Gross Accumulated Accumulated Net (in millions) March 25, 2023 Marketing-related intangible assets – amortizable $ 22.1 $ (21.1) $ — $ 1.0 Marketing-related intangible assets – nonamortizable 252.5 — (26.0) 226.5 Total 274.6 (21.1) (26.0) 227.5 Customer-related intangible assets – amortizable 416.4 (133.1) (2.5) 280.8 Other acquired intangible assets – amortizable 39.7 (28.6) — 11.1 Other acquired intangible assets – nonamortizable 7.1 — (1.2) 5.9 Total 46.8 (28.6) (1.2) 17.1 Total other intangible assets, net $ 737.8 $ (182.8) $ (29.8) $ 525.3 Gross Accumulated Accumulated Net (in millions) March 26, 2022 Marketing-related intangible assets – amortizable $ 22.1 $ (19.8) $ — $ 2.2 Marketing-related intangible assets – nonamortizable 218.2 — (26.0) 192.2 Total 240.3 (19.8) (26.0) 194.4 Customer-related intangible assets – amortizable 386.4 (100.2) (2.5) 283.7 Other acquired intangible assets – amortizable 39.7 (24.5) — 15.2 Other acquired intangible assets – nonamortizable 7.1 — (1.2) 5.9 Total 46.8 (24.5) (1.2) 21.1 Total other intangible assets, net $ 673.5 $ (144.5) $ (29.8) $ 499.3 Gross Accumulated Accumulated Net (in millions) September 24, 2022 Marketing-related intangible assets – amortizable $ 22.1 $ (20.5) $ — $ 1.5 Marketing-related intangible assets – nonamortizable 252.5 — (26.0) 226.5 Total 274.6 (20.5) (26.0) 228.0 Customer-related intangible assets – amortizable 416.4 (117.8) (2.5) 296.1 Other acquired intangible assets – amortizable 39.7 (26.6) — 13.2 Other acquired intangible assets – nonamortizable 7.1 — (1.2) 5.9 Total 46.8 (26.6) (1.2) 19.1 Total other intangible assets, net $ 737.8 $ (164.9) $ (29.8) $ 543.2 |
Long-Term Debt (Tables)
Long-Term Debt (Tables) | 6 Months Ended |
Mar. 25, 2023 | |
Debt Disclosure [Abstract] | |
Components of Long-Term Debt | Long-term debt consists of the following: March 25, 2023 March 26, 2022 September 24, 2022 (in thousands) Senior notes, interest at 5.125%, payable semi-annually, principal due February 2028 $ 300,000 $ 300,000 $ 300,000 Senior notes, interest at 4.125%, payable semi-annually, principal due October 2030 500,000 500,000 500,000 Senior notes, interest at 4.125%, payable semi-annually, principal due April 2031 400,000 400,000 400,000 Unamortized debt issuance costs (13,174) (15,051) (14,116) Net carrying value 1,186,826 1,184,949 1,185,884 Asset-based revolving credit facility, interest at LIBOR plus a margin of 1.00% to 1.50% or Base Rate plus a margin of 0.0% to 0.50%, final maturity December 2026. 25,000 — — Other notes payable 497 885 678 Total 1,212,323 1,185,834 1,186,562 Less current portion (270) (378) (317) Long-term portion $ 1,212,053 $ 1,185,456 $ 1,186,245 |
Supplemental Equity Informati_2
Supplemental Equity Information (Tables) | 6 Months Ended |
Mar. 25, 2023 | |
Equity [Abstract] | |
Schedule of Changes in Carrying Amounts of Equity Attributable to Controlling Interest and Noncontrolling Interest | The following table provides a summary of the changes in the carrying amounts of equity attributable to controlling interest and noncontrolling interest through the six months ended March 25, 2023 and March 26, 2022. Controlling Interest Common Class A Class Additional Retained Accumulated Total Noncontrolling Total (in thousands) Balance September 24, 2022 $ 113 $ 413 $ 16 $ 582,056 $ 755,253 $ (4,145) $ 1,333,706 $ 1,006 $ 1,334,712 Comprehensive loss — — — — (8,433) 782 (7,651) (416) (8,067) Amortization of share-based awards — — — 4,647 — — 4,647 — 4,647 Restricted share activity, including net share settlement — — — (590) — — (590) — (590) Issuance of common stock, including net share settlement of stock options — 1 — 1,707 — — 1,708 — 1,708 Repurchase of stock — (2) — (2,693) (6,271) — (8,966) — (8,966) Balance December 24, 2022 $ 113 $ 412 $ 16 $ 585,127 $ 740,549 $ (3,363) $ 1,322,854 $ 590 $ 1,323,444 Comprehensive income — — — — 48,115 (238) 47,877 563 48,440 Amortization of share-based awards — — — 5,015 — — 5,015 — 5,015 Restricted share activity, including net share settlement — 1 — (3,115) — — (3,114) — (3,114) Repurchase of stock (1) (1) — (807) (1,888) — (2,697) — (2,697) Issuance of common stock, including net share settlement of stock options — 1 — 1,158 — — 1,159 — 1,159 Balance March 25, 2023 $ 112 $ 413 $ 16 $ 587,378 $ 786,776 $ (3,601) $ 1,371,094 $ 1,153 $ 1,372,247 Controlling Interest Common Stock Class A Common Stock Class B Stock Additional Paid In Capital Retained Earnings Accumulated Other Comprehensive Income (Loss) Total Noncontrolling Interest Total (in thousands) Balance September 25, 2021 $ 113 $ 423 $ 16 $ 576,446 $ 646,082 $ (831) $ 1,222,249 $ 1,292 $ 1,223,541 Comprehensive income — — — — 9,009 (442) 8,567 187 8,754 Amortization of share-based awards — — — 3,886 — — 3,886 — 3,886 Restricted share activity, including net share settlement — — — (705) — — (705) — (705) Repurchase of stock — (1) — (1,600) (5,059) — (6,660) — (6,660) Issuance of common stock, including net share settlement of stock options — — — 890 — — 890 — 890 Distribution to Noncontrolling interest — — — — — — — (806) (806) Balance December 25, 2021 $ 113 $ 422 $ 16 $ 578,917 $ 650,032 $ (1,273) $ 1,228,227 $ 673 $ 1,228,900 Comprehensive income — — — — 69,713 570 70,283 573 70,856 Amortization of share-based awards — — — 4,624 — — 4,624 — 4,624 Restricted share activity, including net share settlement — 2 — (923) — — (921) — (921) Repurchase of stock — (2) (2,372) (7,062) — (9,436) (9,436) Issuance of common stock, including net share settlement of stock options — — — 309 — — 309 — 309 Other — — — — — — — 1 1 Balance March 26, 2022 $ 113 $ 422 $ 16 $ 580,555 $ 712,683 $ (703) $ 1,293,086 $ 1,247 $ 1,294,333 |
Earnings Per Share (Tables)
Earnings Per Share (Tables) | 6 Months Ended |
Mar. 25, 2023 | |
Earnings Per Share [Abstract] | |
Schedule of Earnings Per Share, Basic and Diluted | The following is a reconciliation of the numerators and denominators of the basic and diluted per share computations for income from continuing operations. Three Months Ended Six Months Ended March 25, 2023 March 25, 2023 Income Shares Per Share Income Shares Per Share (in thousands, except per share amounts) Basic EPS: Net income available to common shareholders $ 48,115 52,443 $ 0.92 $ 39,682 52,461 $ 0.76 Effect of dilutive securities: Options to purchase common stock — 310 (0.01) — 300 (0.01) Restricted shares — 690 (0.01) — 687 (0.01) Performance stock units — 91 — 72 — Diluted EPS: Net income available to common shareholders $ 48,115 53,534 $ 0.90 $ 39,682 53,520 $ 0.74 Three Months Ended Six Months Ended March 26, 2022 March 26, 2022 Income Shares Per Share Income Shares Per Share (in thousands, except per share amounts) Basic EPS: Net income available to common shareholders $ 69,713 53,458 $ 1.30 $ 78,722 53,475 $ 1.47 Effect of dilutive securities: Options to purchase common stock — 515 (0.01) — 572 (0.01) Restricted shares — 749 (0.02) — 771 (0.02) Diluted EPS: Net income available to common shareholders $ 69,713 54,722 $ 1.27 $ 78,722 54,818 $ 1.44 |
Segment Information (Tables)
Segment Information (Tables) | 6 Months Ended |
Mar. 25, 2023 | |
Segment Reporting [Abstract] | |
Schedule of Financial Information Relating to Company's Business Segments | Financial information relating to the Company's business segments is presented in the table below. Three Months Ended Six Months Ended March 25, 2023 March 26, 2022 March 25, 2023 March 26, 2022 (in thousands) Net sales: Pet segment $ 475,203 $ 497,640 $ 891,023 $ 933,642 Garden segment 433,801 456,730 $ 645,644 682,126 Total net sales $ 909,004 $ 954,370 $ 1,536,667 $ 1,615,768 Operating income (loss) Pet segment 55,255 60,645 94,810 105,896 Garden segment 49,619 70,511 38,799 76,568 Corporate (26,833) (24,311) (55,162) (49,405) Total operating income 78,041 106,845 78,447 133,059 Interest expense - net (14,690) (14,702) (28,466) (29,110) Other income (expense) 595 (369) 2,294 (578) Income tax expense 15,268 21,488 12,446 23,889 Income including noncontrolling interest 48,678 70,286 39,829 79,482 Net income attributable to noncontrolling interest 563 573 147 760 Net income attributable to Central Garden & Pet Company $ 48,115 $ 69,713 $ 39,682 $ 78,722 Depreciation and amortization: Pet segment $ 10,474 $ 9,539 $ 20,586 $ 19,088 Garden segment 10,818 7,719 21,660 17,339 Corporate 817 989 1,555 2,022 Total depreciation and amortization $ 22,109 $ 18,247 $ 43,801 $ 38,449 March 25, 2023 March 26, 2022 September 24, 2022 (in thousands) Assets: Pet segment $ 1,058,549 $ 1,101,814 $ 1,069,167 Garden segment 1,620,907 1,634,158 1,405,802 Corporate 671,342 613,286 807,033 Total assets $ 3,350,798 $ 3,349,258 $ 3,282,002 Goodwill (included in corporate assets above): Pet segment $ 277,067 $ 277,067 $ 277,067 Garden segment 269,369 234,906 269,369 Total goodwill $ 546,436 $ 511,973 $ 546,436 The tables below present the Company's disaggregated revenues by segment: Three Months Ended March 25, 2023 Six Months Ended March 25, 2023 Pet Segment Garden Segment Total Pet Segment Garden Segment Total (in millions) (in millions) Other pet products $ 194.1 $ — $ 194.1 $ 333.6 $ — $ 333.6 Dog and cat products 126.7 — 126.7 260.8 — 260.8 Other manufacturers' products 103.0 95.7 198.7 206.4 141.8 348.2 Wild bird products 51.4 81.5 132.9 90.2 141.0 231.3 Other garden supplies — 256.6 256.6 — 362.8 362.8 Total $ 475.2 $ 433.8 $ 909.0 $ 891.0 $ 645.6 $ 1,536.7 Three Months Ended March 26, 2022 Six Months Ended March 26, 2022 Pet Segment Garden Segment Total Pet Segment Garden Segment Total (in millions) (in millions) Other pet products $ 223.7 $ — $ 223.7 $ 377.4 $ — $ 377.4 Dog and cat products 129.3 — 129.3 274.2 — 274.2 Other manufacturers' products 98.5 95.4 193.9 203.0 144.8 347.8 Wild bird products 46.1 72.8 118.9 79.0 127.5 206.5 Other garden supplies — 288.5 288.5 — 409.8 409.8 Total $ 497.6 $ 456.7 $ 954.3 $ 933.6 $ 682.1 $ 1,615.7 |
Basis of Presentation - Narrati
Basis of Presentation - Narrative (Details) | 6 Months Ended |
Mar. 25, 2023 | |
Revenue Benchmark | Revenue from Rights Concentration Risk | Third Party Providers | |
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |
Minor amount of non-product revenue (less than) | 1% |
Subsidiary | |
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |
Noncontrolling interest owned by the subsidiary | 20% |
Basis of Presentation - Cash, C
Basis of Presentation - Cash, Cash Equivalents and Restricted Cash (Details) - USD ($) $ in Thousands | Mar. 25, 2023 | Sep. 24, 2022 | Mar. 26, 2022 | Sep. 25, 2021 |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||||
Cash and cash equivalents | $ 60,607 | $ 177,442 | $ 54,082 | |
Restricted cash | 13,475 | 14,742 | 12,676 | |
Total cash, cash equivalents and restricted cash | $ 74,082 | $ 192,184 | $ 66,758 | $ 439,522 |
Fair Value Measurements - Narra
Fair Value Measurements - Narrative (Details) - USD ($) $ in Thousands | Mar. 25, 2023 | Sep. 24, 2022 | Mar. 26, 2022 | Apr. 30, 2021 | Oct. 31, 2020 | Dec. 31, 2017 | Dec. 14, 2017 |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||||||
Carrying value of senior subordinated notes | $ 1,212,323 | $ 1,186,562 | $ 1,185,834 | ||||
Senior notes | |||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||||||
Carrying value of senior subordinated notes | $ 1,186,826 | 1,185,884 | 1,184,949 | ||||
Senior notes | Senior notes, interest at 4.125%, payable semi-annually, principal due April 2031 | |||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||||||
Debt, aggregate principal amount | $ 400,000 | ||||||
Interest rate | 4.125% | 4.125% | |||||
Estimated fair value of senior notes | $ 334,000 | 327,600 | 359,200 | ||||
Carrying value of senior subordinated notes | $ 395,100 | 394,800 | 394,500 | ||||
Senior notes | Senior notes, interest at 4.125%, payable semi-annually, principal due October 2030 | |||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||||||
Debt, aggregate principal amount | $ 500,000 | ||||||
Interest rate | 4.125% | 4.125% | |||||
Estimated fair value of senior notes | $ 426,300 | 407,600 | 452,500 | ||||
Carrying value of senior subordinated notes | $ 494,000 | 493,600 | 493,200 | ||||
Senior notes | Senior notes, interest at 5.125%, payable semi-annually, principal due February 2028 | |||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||||||
Debt, aggregate principal amount | $ 300,000 | $ 300,000 | |||||
Interest rate | 5.125% | 5.125% | 5.125% | ||||
Estimated fair value of senior notes | $ 281,900 | 272,200 | 296,800 | ||||
Carrying value of senior subordinated notes | $ 297,700 | $ 297,500 | $ 297,300 |
Inventories, net - Summary of I
Inventories, net - Summary of Inventories, Net of Allowance for Obsolescence (Details) - USD ($) $ in Thousands | Mar. 25, 2023 | Sep. 24, 2022 | Mar. 26, 2022 |
Inventory Disclosure [Abstract] | |||
Raw materials | $ 295,071 | $ 266,695 | $ 249,793 |
Work in progress | 190,526 | 99,842 | 99,157 |
Finished goods | 454,464 | 528,481 | 511,284 |
Supplies | 26,839 | 42,982 | 27,817 |
Total inventories, net | $ 966,900 | $ 938,000 | $ 888,051 |
Goodwill - Narrative (Details)
Goodwill - Narrative (Details) | 3 Months Ended | 6 Months Ended | |
Mar. 25, 2023 USD ($) | Mar. 25, 2023 segment | Mar. 26, 2022 USD ($) | |
Goodwill and Intangible Assets Disclosure [Abstract] | |||
Number of reporting units | segment | 2 | ||
Impairment of goodwill | $ | $ 0 | $ 0 |
Other Intangible Assets - Compo
Other Intangible Assets - Components of Gross and Net Acquired Intangible Assets (Details) - USD ($) $ in Thousands | Mar. 25, 2023 | Sep. 24, 2022 | Mar. 26, 2022 |
Acquired Indefinite-lived Intangible Assets [Line Items] | |||
Gross | $ 737,800 | $ 737,800 | $ 673,500 |
Accumulated Amortization | (182,800) | (164,900) | (144,500) |
Accumulated Impairment | (29,800) | (29,800) | (29,800) |
Net Carrying Value | 525,301 | 543,210 | 499,251 |
Marketing-related intangible assets | |||
Acquired Indefinite-lived Intangible Assets [Line Items] | |||
Gross | 274,600 | 274,600 | 240,300 |
Accumulated Amortization | (21,100) | (20,500) | (19,800) |
Accumulated Impairment | (26,000) | (26,000) | (26,000) |
Net Carrying Value | 227,500 | 228,000 | 194,400 |
Other acquired intangible assets | |||
Acquired Indefinite-lived Intangible Assets [Line Items] | |||
Gross | 46,800 | 46,800 | 46,800 |
Accumulated Amortization | (28,600) | (26,600) | (24,500) |
Accumulated Impairment | (1,200) | (1,200) | (1,200) |
Net Carrying Value | 17,100 | 19,100 | 21,100 |
Amortizable | Marketing-related intangible assets | |||
Acquired Indefinite-lived Intangible Assets [Line Items] | |||
Gross | 22,100 | 22,100 | 22,100 |
Accumulated Amortization | (21,100) | (20,500) | (19,800) |
Accumulated Impairment | 0 | 0 | 0 |
Net Carrying Value | 1,000 | 1,500 | 2,200 |
Amortizable | Customer-related intangible assets | |||
Acquired Indefinite-lived Intangible Assets [Line Items] | |||
Gross | 416,400 | 416,400 | 386,400 |
Accumulated Amortization | (133,100) | (117,800) | (100,200) |
Accumulated Impairment | (2,500) | (2,500) | (2,500) |
Net Carrying Value | 280,800 | 296,100 | 283,700 |
Amortizable | Other acquired intangible assets | |||
Acquired Indefinite-lived Intangible Assets [Line Items] | |||
Gross | 39,700 | 39,700 | 39,700 |
Accumulated Amortization | (28,600) | (26,600) | (24,500) |
Accumulated Impairment | 0 | 0 | 0 |
Net Carrying Value | 11,100 | 13,200 | 15,200 |
Nonamortizable | Marketing-related intangible assets | |||
Acquired Indefinite-lived Intangible Assets [Line Items] | |||
Gross | 252,500 | 252,500 | 218,200 |
Accumulated Amortization | 0 | 0 | 0 |
Accumulated Impairment | (26,000) | (26,000) | (26,000) |
Net Carrying Value | 226,500 | 226,500 | 192,200 |
Nonamortizable | Other acquired intangible assets | |||
Acquired Indefinite-lived Intangible Assets [Line Items] | |||
Gross | 7,100 | 7,100 | 7,100 |
Accumulated Amortization | 0 | 0 | 0 |
Accumulated Impairment | (1,200) | (1,200) | (1,200) |
Net Carrying Value | $ 5,900 | $ 5,900 | $ 5,900 |
Other Intangible Assets - Narra
Other Intangible Assets - Narrative (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Mar. 25, 2023 | Mar. 26, 2022 | Mar. 25, 2023 | Mar. 26, 2022 | |
Finite-Lived Intangible Assets [Line Items] | ||||
Useful life of intangible assets | 5 years | |||
Estimated annual amortization expense related to acquired intangible assets 2023 | $ 35 | $ 35 | ||
Estimated annual amortization expense related to acquired intangible assets 2024 | 35 | 35 | ||
Estimated annual amortization expense related to acquired intangible assets 2025 | 35 | 35 | ||
Estimated annual amortization expense related to acquired intangible assets 2026 | 26 | 26 | ||
Estimated annual amortization expense related to acquired intangible assets 2027 | 26 | $ 26 | ||
Marketing-related intangible assets | ||||
Finite-Lived Intangible Assets [Line Items] | ||||
Weighted average remaining lives of acquired intangible assets | 2 years | |||
Customer-related intangible assets | ||||
Finite-Lived Intangible Assets [Line Items] | ||||
Weighted average remaining lives of acquired intangible assets | 12 years | |||
Other acquired intangible assets | ||||
Finite-Lived Intangible Assets [Line Items] | ||||
Weighted average remaining lives of acquired intangible assets | 6 years | |||
Minimum | ||||
Finite-Lived Intangible Assets [Line Items] | ||||
Weighted average remaining lives of acquired intangible assets | 2 years | |||
Maximum | ||||
Finite-Lived Intangible Assets [Line Items] | ||||
Weighted average remaining lives of acquired intangible assets | 25 years | |||
Selling, general and administrative expenses | ||||
Finite-Lived Intangible Assets [Line Items] | ||||
Amortization expense for intangibles | $ 8.9 | $ 7.8 | $ 17.9 | $ 14.7 |
Long-Term Debt - Components of
Long-Term Debt - Components of Long-term Debt (Details) - USD ($) $ in Thousands | 6 Months Ended | ||||||
Mar. 25, 2023 | Sep. 24, 2022 | Mar. 26, 2022 | Apr. 30, 2021 | Oct. 31, 2020 | Dec. 31, 2017 | Dec. 14, 2017 | |
Debt Instrument [Line Items] | |||||||
Total | $ 1,212,323 | $ 1,186,562 | $ 1,185,834 | ||||
Less current portion | (270) | (317) | (378) | ||||
Long-term portion | 1,212,053 | 1,186,245 | 1,185,456 | ||||
Senior notes | |||||||
Debt Instrument [Line Items] | |||||||
Unamortized debt issuance costs | (13,174) | (14,116) | (15,051) | ||||
Total | $ 1,186,826 | 1,185,884 | 1,184,949 | ||||
Senior notes | Senior notes, interest at 5.125%, payable semi-annually, principal due February 2028 | |||||||
Debt Instrument [Line Items] | |||||||
Interest rate | 5.125% | 5.125% | 5.125% | ||||
Gross carrying value | $ 300,000 | 300,000 | 300,000 | ||||
Total | $ 297,700 | 297,500 | 297,300 | ||||
Senior notes | Senior notes, interest at 4.125%, payable semi-annually, principal due October 2030 | |||||||
Debt Instrument [Line Items] | |||||||
Interest rate | 4.125% | 4.125% | |||||
Gross carrying value | $ 500,000 | 500,000 | 500,000 | ||||
Total | $ 494,000 | 493,600 | 493,200 | ||||
Senior notes | Senior notes, interest at 4.125%, payable semi-annually, principal due April 2031 | |||||||
Debt Instrument [Line Items] | |||||||
Interest rate | 4.125% | 4.125% | |||||
Gross carrying value | $ 400,000 | 400,000 | 400,000 | ||||
Total | 395,100 | 394,800 | 394,500 | ||||
Secured debt | Asset-based revolving credit facility, interest at LIBOR plus a margin of 1.00% to 1.50% or Base Rate plus a margin of 0.0% to 0.50%, final maturity December 2026. | |||||||
Debt Instrument [Line Items] | |||||||
Total | $ 25,000 | 0 | 0 | ||||
Secured debt | Asset-based revolving credit facility, interest at LIBOR plus a margin of 1.00% to 1.50% or Base Rate plus a margin of 0.0% to 0.50%, final maturity December 2026. | Minimum | LIBOR-based borrowings | |||||||
Debt Instrument [Line Items] | |||||||
Interest rate margin | 1% | ||||||
Secured debt | Asset-based revolving credit facility, interest at LIBOR plus a margin of 1.00% to 1.50% or Base Rate plus a margin of 0.0% to 0.50%, final maturity December 2026. | Minimum | Base rate borrowings | |||||||
Debt Instrument [Line Items] | |||||||
Interest rate margin | 0% | ||||||
Secured debt | Asset-based revolving credit facility, interest at LIBOR plus a margin of 1.00% to 1.50% or Base Rate plus a margin of 0.0% to 0.50%, final maturity December 2026. | Maximum | LIBOR-based borrowings | |||||||
Debt Instrument [Line Items] | |||||||
Interest rate margin | 1.50% | ||||||
Secured debt | Asset-based revolving credit facility, interest at LIBOR plus a margin of 1.00% to 1.50% or Base Rate plus a margin of 0.0% to 0.50%, final maturity December 2026. | Maximum | Base rate borrowings | |||||||
Debt Instrument [Line Items] | |||||||
Interest rate margin | 0.50% | ||||||
Other notes payable | |||||||
Debt Instrument [Line Items] | |||||||
Total | $ 497 | $ 678 | $ 885 |
Long-Term Debt - Narrative (Det
Long-Term Debt - Narrative (Details) | 6 Months Ended | ||||||
Apr. 30, 2021 USD ($) | Oct. 31, 2020 USD ($) | Dec. 14, 2017 USD ($) | Mar. 25, 2023 USD ($) | Dec. 16, 2021 USD ($) | Dec. 31, 2017 USD ($) | Apr. 22, 2016 | |
Components of long-term debt | |||||||
Line of credit facility, commitment fee percentage | 0.125% | ||||||
Domestic Subsidiary | |||||||
Components of long-term debt | |||||||
Stock or equity interest, percentage | 100% | ||||||
Foreign Subsidiary | |||||||
Components of long-term debt | |||||||
Stock or equity interest, percentage | 65% | ||||||
Revolving credit facility | LIBOR-based borrowings | |||||||
Components of long-term debt | |||||||
Applicable interest margin rate on the credit facility | 0% | ||||||
Letter of credit | |||||||
Components of long-term debt | |||||||
Letters of credit outstanding | $ 0 | ||||||
Other letters of credit outstanding | 1,300,000 | ||||||
Standby letters of credit | |||||||
Components of long-term debt | |||||||
Letters of credit outstanding | 50,000,000 | ||||||
Short-term Debt | |||||||
Components of long-term debt | |||||||
Letters of credit outstanding | 75,000,000 | ||||||
Secured debt | Revolving credit facility | |||||||
Components of long-term debt | |||||||
Credit facility, maximum principal amount | $ 750,000,000 | ||||||
Credit facility, additional borrowings available | $ 400,000,000 | ||||||
Credit facility, available capacity | 635,000,000 | ||||||
Amount borrowed to partially finance acquisition | 25,000,000 | ||||||
Debt issuance costs | $ 2,400,000 | ||||||
Debt instrument fixed charge coverage ratio | 1 | ||||||
Secured debt | Revolving credit facility | Fed Funds Effective Rate Overnight Index Swap Rate | |||||||
Components of long-term debt | |||||||
Applicable interest margin rate on the credit facility | 0.50% | ||||||
Secured debt | Revolving credit facility | One-month LIBOR | |||||||
Components of long-term debt | |||||||
Applicable interest margin rate on the credit facility | 1% | ||||||
Secured debt | Revolving credit facility | LIBOR-based borrowings | |||||||
Components of long-term debt | |||||||
Applicable interest margin rate on the credit facility | 1% | ||||||
Applicable interest rate on the credit facility | 5.80% | ||||||
Secured debt | Revolving credit facility | LIBOR-based borrowings | Minimum | |||||||
Components of long-term debt | |||||||
Line of credit facility, interest rate during period | 0% | ||||||
Applicable interest margin rate on the credit facility | 1% | ||||||
Secured debt | Revolving credit facility | LIBOR-based borrowings | Maximum | |||||||
Components of long-term debt | |||||||
Applicable interest margin rate on the credit facility | 1.50% | ||||||
Secured debt | Revolving credit facility | Base rate borrowings | |||||||
Components of long-term debt | |||||||
Applicable interest margin rate on the credit facility | 0% | ||||||
Applicable interest rate on the credit facility | 8% | ||||||
Secured debt | Revolving credit facility | Base rate borrowings | Minimum | |||||||
Components of long-term debt | |||||||
Applicable interest margin rate on the credit facility | 0% | ||||||
Secured debt | Revolving credit facility | Base rate borrowings | Maximum | |||||||
Components of long-term debt | |||||||
Applicable interest margin rate on the credit facility | 0.50% | ||||||
4.125% Senior Notes due 2031 | Upon change of control | |||||||
Components of long-term debt | |||||||
Debt redemption price percentage | 101% | ||||||
4.125% Senior Notes due 2031 | Senior notes | |||||||
Components of long-term debt | |||||||
Debt, aggregate principal amount | $ 400,000,000 | ||||||
Interest rate | 4.125% | 4.125% | |||||
Debt issuance costs | $ 6,000,000 | ||||||
Debt option to redeem, percentage | 40% | ||||||
Debt redemption price percentage | 104.125% | ||||||
4.125% Senior Notes due 2031 | Senior notes | Redemption period one | |||||||
Components of long-term debt | |||||||
Debt redemption price percentage | 102.063% | ||||||
4.125% Senior Notes due 2031 | Senior notes | Redemption period two | |||||||
Components of long-term debt | |||||||
Debt redemption price percentage | 101.375% | ||||||
4.125% Senior Notes due 2031 | Senior notes | Redemption period three | |||||||
Components of long-term debt | |||||||
Debt redemption price percentage | 100.688% | ||||||
4.125% Senior Notes due 2031 | Senior notes | Redemption period four | |||||||
Components of long-term debt | |||||||
Debt redemption price percentage | 100% | ||||||
4.125% Senior Notes due 2030 | Senior notes | |||||||
Components of long-term debt | |||||||
Debt, aggregate principal amount | $ 500,000,000 | ||||||
Interest rate | 4.125% | 4.125% | |||||
Debt issuance costs | $ 8,000,000 | ||||||
Debt redemption price percentage | 104.125% | ||||||
Percentage of purchase price equal | 100% | ||||||
Redemption percentage | 40% | ||||||
4.125% Senior Notes due 2030 | Senior notes | Redemption period one | |||||||
Components of long-term debt | |||||||
Debt redemption price percentage | 102.063% | ||||||
4.125% Senior Notes due 2030 | Senior notes | Redemption period two | |||||||
Components of long-term debt | |||||||
Debt redemption price percentage | 101.375% | ||||||
4.125% Senior Notes due 2030 | Senior notes | Redemption period three | |||||||
Components of long-term debt | |||||||
Debt redemption price percentage | 100.688% | ||||||
4.125% Senior Notes due 2030 | Senior notes | Redemption period four | |||||||
Components of long-term debt | |||||||
Debt redemption price percentage | 100% | ||||||
4.125% Senior Notes due 2030 | Senior notes | Upon change of control | |||||||
Components of long-term debt | |||||||
Debt redemption price percentage | 101% | ||||||
2023 Notes | Senior notes | |||||||
Components of long-term debt | |||||||
Interest rate | 6.125% | ||||||
2023 Notes | Senior notes | Redemption period two | |||||||
Components of long-term debt | |||||||
Debt redemption price percentage | 101.531% | ||||||
5.125% Senior Notes due 2028 | Senior notes | |||||||
Components of long-term debt | |||||||
Debt, aggregate principal amount | $ 300,000,000 | $ 300,000,000 | |||||
Interest rate | 5.125% | 5.125% | 5.125% | ||||
Debt issuance cost | $ 4,800,000 | ||||||
5.125% Senior Notes due 2028 | Senior notes | Redemption period three | |||||||
Components of long-term debt | |||||||
Debt redemption price percentage | 101.708% | ||||||
5.125% Senior Notes due 2028 | Senior notes | Redemption period four | |||||||
Components of long-term debt | |||||||
Debt redemption price percentage | 100.854% | ||||||
5.125% Senior Notes due 2028 | Senior notes | Redemption period five | |||||||
Components of long-term debt | |||||||
Debt redemption price percentage | 100% | ||||||
5.125% Senior Notes due 2028 | Senior notes | Upon change of control | |||||||
Components of long-term debt | |||||||
Debt redemption price percentage | 101% |
Supplemental Equity Informati_3
Supplemental Equity Information - Summary of Changes in Carrying Amounts of Equity Attributable to Controlling Interest and Noncontrolling Interest (Details) - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | 6 Months Ended | ||||
Mar. 25, 2023 | Dec. 24, 2022 | Mar. 26, 2022 | Dec. 25, 2021 | Mar. 25, 2023 | Mar. 26, 2022 | |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Beginning balance | $ 1,323,444 | $ 1,334,712 | $ 1,228,900 | $ 1,223,541 | $ 1,334,712 | $ 1,223,541 |
Comprehensive loss | 48,440 | (8,067) | 70,856 | 8,754 | 40,374 | 79,610 |
Amortization of share-based awards | 5,015 | 4,647 | 4,624 | 3,886 | ||
Restricted share activity, including net share settlement | (3,114) | (590) | (921) | (705) | ||
Issuance of common stock, including net share settlement of stock options | 1,159 | 1,708 | 309 | 890 | ||
Repurchase of stock | (2,697) | (8,966) | (9,436) | (6,660) | ||
Other | 1 | |||||
Distribution to Noncontrolling interest | (806) | |||||
Ending balance | 1,372,247 | 1,323,444 | 1,294,333 | 1,228,900 | 1,372,247 | 1,294,333 |
Total | ||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Beginning balance | 1,322,854 | 1,333,706 | 1,228,227 | 1,222,249 | 1,333,706 | 1,222,249 |
Comprehensive loss | 47,877 | (7,651) | 70,283 | 8,567 | ||
Amortization of share-based awards | 5,015 | 4,647 | 4,624 | 3,886 | ||
Restricted share activity, including net share settlement | (3,114) | (590) | (921) | (705) | ||
Issuance of common stock, including net share settlement of stock options | 1,159 | 1,708 | 309 | 890 | ||
Repurchase of stock | (2,697) | (8,966) | (9,436) | (6,660) | ||
Ending balance | 1,371,094 | 1,322,854 | 1,293,086 | 1,228,227 | 1,371,094 | 1,293,086 |
Additional Paid In Capital | ||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Beginning balance | 585,127 | 582,056 | 578,917 | 576,446 | 582,056 | 576,446 |
Amortization of share-based awards | 5,015 | 4,647 | 4,624 | 3,886 | ||
Restricted share activity, including net share settlement | (3,115) | (590) | (923) | (705) | ||
Issuance of common stock, including net share settlement of stock options | 1,158 | 1,707 | 309 | 890 | ||
Repurchase of stock | (807) | (2,693) | (2,372) | (1,600) | ||
Ending balance | 587,378 | 585,127 | 580,555 | 578,917 | 587,378 | 580,555 |
Retained Earnings | ||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Beginning balance | 740,549 | 755,253 | 650,032 | 646,082 | 755,253 | 646,082 |
Comprehensive loss | 48,115 | (8,433) | 69,713 | 9,009 | ||
Repurchase of stock | (1,888) | (6,271) | (7,062) | (5,059) | ||
Ending balance | 786,776 | 740,549 | 712,683 | 650,032 | 786,776 | 712,683 |
Accumulated Other Comprehensive Income (Loss) | ||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Beginning balance | (3,363) | (4,145) | (1,273) | (831) | (4,145) | (831) |
Comprehensive loss | (238) | 782 | 570 | (442) | ||
Ending balance | (3,601) | (3,363) | (703) | (1,273) | (3,601) | (703) |
Noncontrolling Interest | ||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Beginning balance | 590 | 1,006 | 673 | 1,292 | 1,006 | 1,292 |
Comprehensive loss | 563 | (416) | 573 | 187 | ||
Other | 1 | |||||
Distribution to Noncontrolling interest | (806) | |||||
Ending balance | 1,153 | 590 | 1,247 | 673 | 1,153 | 1,247 |
Common Stock | Common Stock | ||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Beginning balance | $ 113 | 113 | 113 | 113 | 113 | 113 |
Repurchase of stock (in shares) | (1) | |||||
Repurchase of stock | 0 | |||||
Ending balance | $ 112 | 113 | 113 | 113 | 112 | 113 |
Class A Common Stock | Common Stock | ||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Beginning balance | 412 | $ 413 | 422 | 423 | 413 | 423 |
Restricted share activity, including net share settlement | 1 | 2 | ||||
Issuance of common stock, including new shares settlement of stock options (in shares) | 1 | |||||
Issuance of common stock, including net share settlement of stock options | $ 1 | |||||
Repurchase of stock (in shares) | (1) | (2) | ||||
Repurchase of stock | (2) | (1) | ||||
Ending balance | $ 413 | $ 412 | 422 | 422 | 413 | 422 |
Class B Stock | Common Stock | ||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Beginning balance | 16 | 16 | 16 | 16 | 16 | 16 |
Ending balance | $ 16 | $ 16 | $ 16 | $ 16 | $ 16 | $ 16 |
Stock-Based Compensation - Narr
Stock-Based Compensation - Narrative (Details) - USD ($) $ in Millions | 6 Months Ended | |
Mar. 25, 2023 | Mar. 26, 2022 | |
Share-Based Payment Arrangement [Abstract] | ||
Share-based compensation expense | $ 13.3 | $ 11.5 |
Tax benefit associated with share-based compensation expense | $ 3.2 | $ 2.7 |
Earnings Per Share - Earnings P
Earnings Per Share - Earnings Per Share, Basic and Diluted (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Mar. 25, 2023 | Mar. 26, 2022 | Mar. 25, 2023 | Mar. 26, 2022 | |
Basic EPS: | ||||
Net income available to common shareholders | $ 48,115 | $ 69,713 | $ 39,682 | $ 78,722 |
Weighted average shares, basic (in shares) | 52,443 | 53,458 | 52,461 | 53,475 |
Earnings per share, basic (in dollars per share) | $ 0.92 | $ 1.30 | $ 0.76 | $ 1.47 |
Diluted EPS: | ||||
Net income available to common shareholders | $ 48,115 | $ 69,713 | $ 39,682 | $ 78,722 |
Net income available to common shareholders, diluted (in shares) | 53,534 | 54,722 | 53,520 | 54,818 |
Net income available to common shareholders, diluted (in dollars per share) | $ 0.90 | $ 1.27 | $ 0.74 | $ 1.44 |
Options to purchase common stock | ||||
Effect of dilutive securities: | ||||
Options to purchase common stock, restricted shares, and performance stock units | $ 0 | $ 0 | $ 0 | $ 0 |
Options to purchase common stock units (in shares) | 310 | 515 | 300 | 572 |
Options to purchase common stock (in dollars per share) | $ (0.01) | $ (0.01) | $ (0.01) | $ (0.01) |
Restricted shares | ||||
Effect of dilutive securities: | ||||
Options to purchase common stock, restricted shares, and performance stock units | $ 0 | $ 0 | $ 0 | $ 0 |
Restricted shares (in shares) | 690 | 749 | 687 | 771 |
Restricted shares (in dollars per share) | $ (0.01) | $ (0.02) | $ (0.01) | $ (0.02) |
Performance stock units | ||||
Effect of dilutive securities: | ||||
Options to purchase common stock, restricted shares, and performance stock units | $ 0 | |||
Performance stock units (in shares) | 91 | 72 | ||
Performance stock units (in dollars per share) | $ 0 | $ 0 |
Earnings Per Share - Narrative
Earnings Per Share - Narrative (Details) - $ / shares shares in Thousands | 3 Months Ended | 6 Months Ended | ||
Mar. 25, 2023 | Mar. 26, 2022 | Mar. 25, 2023 | Mar. 26, 2022 | |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Number of options to purchase common stock outstanding (in shares) | 2,000 | 2,400 | 2,000 | 2,400 |
Employee Stock Option | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Antidilutive securities excluded from computation of earnings per share, amount (in shares) | 600 | 400 | ||
Restricted stock | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Antidilutive securities excluded from computation of earnings per share, amount (in shares) | 600 | 21 | ||
Minimum | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Options to purchase common stock (in dollars per share) | $ 21.37 | $ 13.82 | $ 21.37 | $ 13.82 |
Maximum | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Options to purchase common stock (in dollars per share) | $ 51.37 | $ 51.37 | $ 51.37 | $ 51.37 |
Segment Information - Narrative
Segment Information - Narrative (Details) | 6 Months Ended |
Mar. 25, 2023 segment | |
Segment Reporting [Abstract] | |
Number of operating segments | 2 |
Segment Information - Financial
Segment Information - Financial Information Relating to Company's Business Segments (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | |||
Mar. 25, 2023 | Mar. 26, 2022 | Mar. 25, 2023 | Mar. 26, 2022 | Sep. 24, 2022 | |
Net sales: | |||||
Net sales | $ 909,004 | $ 954,370 | $ 1,536,667 | $ 1,615,768 | |
Operating income (loss) | |||||
Total operating income | 78,041 | 106,845 | 78,447 | 133,059 | |
Interest expense - net | (14,690) | (14,702) | (28,466) | (29,110) | |
Other income (expense) | 595 | (369) | 2,294 | (578) | |
Income tax expense | 15,268 | 21,488 | 12,446 | 23,889 | |
Income including noncontrolling interest | 48,678 | 70,286 | 39,829 | 79,482 | |
Net income attributable to noncontrolling interest | 563 | 573 | 147 | 760 | |
Net income attributable to Central Garden & Pet Company | 48,115 | 69,713 | 39,682 | 78,722 | |
Depreciation and amortization: | |||||
Depreciation and amortization | 22,109 | 18,247 | 43,801 | 38,449 | |
Assets: | |||||
Total assets | 3,350,798 | 3,349,258 | 3,350,798 | 3,349,258 | $ 3,282,002 |
Goodwill (included in corporate assets above): | |||||
Total goodwill | 546,436 | 511,973 | 546,436 | 511,973 | 546,436 |
Pet Segment | |||||
Net sales: | |||||
Net sales | 475,203 | 497,640 | 891,023 | 933,642 | |
Garden Segment | |||||
Net sales: | |||||
Net sales | 433,801 | 456,730 | 645,644 | 682,126 | |
Operating segments | Pet Segment | |||||
Operating income (loss) | |||||
Total operating income | 55,255 | 60,645 | 94,810 | 105,896 | |
Depreciation and amortization: | |||||
Depreciation and amortization | 10,474 | 9,539 | 20,586 | 19,088 | |
Assets: | |||||
Total assets | 1,058,549 | 1,101,814 | 1,058,549 | 1,101,814 | 1,069,167 |
Goodwill (included in corporate assets above): | |||||
Total goodwill | 277,067 | 277,067 | 277,067 | 277,067 | 277,067 |
Operating segments | Garden Segment | |||||
Operating income (loss) | |||||
Total operating income | 49,619 | 70,511 | 38,799 | 76,568 | |
Depreciation and amortization: | |||||
Depreciation and amortization | 10,818 | 7,719 | 21,660 | 17,339 | |
Assets: | |||||
Total assets | 1,620,907 | 1,634,158 | 1,620,907 | 1,634,158 | 1,405,802 |
Goodwill (included in corporate assets above): | |||||
Total goodwill | 269,369 | 234,906 | 269,369 | 234,906 | 269,369 |
Corporate | |||||
Operating income (loss) | |||||
Total operating income | (26,833) | (24,311) | (55,162) | (49,405) | |
Depreciation and amortization: | |||||
Depreciation and amortization | 817 | 989 | 1,555 | 2,022 | |
Assets: | |||||
Total assets | $ 671,342 | $ 613,286 | $ 671,342 | $ 613,286 | $ 807,033 |
Segment Information - Disaggreg
Segment Information - Disaggregated Revenues by Segment (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Mar. 25, 2023 | Mar. 26, 2022 | Mar. 25, 2023 | Mar. 26, 2022 | |
Segment Reporting Information [Line Items] | ||||
Revenues | $ 909,004 | $ 954,370 | $ 1,536,667 | $ 1,615,768 |
Pet Segment | ||||
Segment Reporting Information [Line Items] | ||||
Revenues | 475,203 | 497,640 | 891,023 | 933,642 |
Garden Segment | ||||
Segment Reporting Information [Line Items] | ||||
Revenues | 433,801 | 456,730 | 645,644 | 682,126 |
Other pet products | ||||
Segment Reporting Information [Line Items] | ||||
Revenues | 194,100 | 223,700 | 333,600 | 377,400 |
Other pet products | Pet Segment | ||||
Segment Reporting Information [Line Items] | ||||
Revenues | 194,100 | 223,700 | 333,600 | 377,400 |
Other pet products | Garden Segment | ||||
Segment Reporting Information [Line Items] | ||||
Revenues | 0 | 0 | 0 | 0 |
Dog and cat products | ||||
Segment Reporting Information [Line Items] | ||||
Revenues | 126,700 | 129,300 | 260,800 | 274,200 |
Dog and cat products | Pet Segment | ||||
Segment Reporting Information [Line Items] | ||||
Revenues | 126,700 | 129,300 | 260,800 | 274,200 |
Dog and cat products | Garden Segment | ||||
Segment Reporting Information [Line Items] | ||||
Revenues | 0 | 0 | 0 | 0 |
Other manufacturers' products | ||||
Segment Reporting Information [Line Items] | ||||
Revenues | 198,700 | 193,900 | 348,200 | 347,800 |
Other manufacturers' products | Pet Segment | ||||
Segment Reporting Information [Line Items] | ||||
Revenues | 103,000 | 98,500 | 206,400 | 203,000 |
Other manufacturers' products | Garden Segment | ||||
Segment Reporting Information [Line Items] | ||||
Revenues | 95,700 | 95,400 | 141,800 | 144,800 |
Wild bird products | ||||
Segment Reporting Information [Line Items] | ||||
Revenues | 132,900 | 118,900 | 231,300 | 206,500 |
Wild bird products | Pet Segment | ||||
Segment Reporting Information [Line Items] | ||||
Revenues | 51,400 | 46,100 | 90,200 | 79,000 |
Wild bird products | Garden Segment | ||||
Segment Reporting Information [Line Items] | ||||
Revenues | 81,500 | 72,800 | 141,000 | 127,500 |
Other garden supplies | ||||
Segment Reporting Information [Line Items] | ||||
Revenues | 256,600 | 288,500 | 362,800 | 409,800 |
Other garden supplies | Pet Segment | ||||
Segment Reporting Information [Line Items] | ||||
Revenues | 0 | 0 | 0 | 0 |
Other garden supplies | Garden Segment | ||||
Segment Reporting Information [Line Items] | ||||
Revenues | $ 256,600 | $ 288,500 | $ 362,800 | $ 409,800 |
Contingencies Contingencies (De
Contingencies Contingencies (Details) $ in Millions | 1 Months Ended | |
Jun. 27, 2018 USD ($) claim | Jun. 30, 2020 USD ($) | |
Commitments and Contingencies Disclosure [Abstract] | ||
Number of claims | claim | 3 | |
Damages awarded | $ | $ 12.6 | $ 12.4 |
Subsequent Events (Details)
Subsequent Events (Details) $ in Millions | 3 Months Ended |
Jun. 24, 2023 USD ($) | |
Subsequent event | |
Subsequent Event [Line Items] | |
Closure Of Manufacturing And Distribution Facility | $ 15 |