Cover
Cover - shares | 6 Months Ended | |
Oct. 29, 2022 | Nov. 21, 2022 | |
Cover [Abstract] | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Period End Date | Oct. 29, 2022 | |
Document Transition Report | false | |
Entity File Number | 0-20572 | |
Entity Registrant Name | PATTERSON COMPANIES, INC. | |
Entity Incorporation, State or Country Code | MN | |
Entity Tax Identification Number | 41-0886515 | |
Entity Address, Address Line One | 1031 Mendota Heights Road | |
Entity Address, City or Town | St. Paul | |
Entity Address, State or Province | MN | |
Entity Address, Postal Zip Code | 55120 | |
City Area Code | 651 | |
Local Phone Number | 686-1600 | |
Title of 12(b) Security | Common Stock, par value $.01 | |
Trading Symbol | PDCO | |
Security Exchange Name | NASDAQ | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Large Accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 97,068,000 | |
Amendment Flag | false | |
Document Fiscal Year Focus | 2023 | |
Document Fiscal Period Focus | Q2 | |
Entity Central Index Key | 0000891024 | |
Current Fiscal Year End Date | --04-29 |
CONDENSED CONSOLIDATED BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Oct. 29, 2022 | Apr. 30, 2022 |
Current assets: | ||
Cash and cash equivalents | $ 140,280 | $ 142,014 |
Receivables, net of allowance for doubtful accounts of $4,314 and $5,913 | 454,649 | 447,162 |
Inventory | 877,435 | 785,604 |
Prepaid expenses and other current assets | 353,170 | 304,242 |
Total current assets | 1,825,534 | 1,679,022 |
Property and equipment, net | 208,120 | 213,140 |
Operating lease right-of-use assets, net | 73,874 | 70,722 |
Long-term receivables, net | 114,257 | 138,812 |
Goodwill, net | 140,055 | 140,630 |
Identifiable intangibles, net | 232,790 | 252,614 |
Investments | 157,777 | 139,182 |
Other non-current assets, net | 128,061 | 107,508 |
Total assets | 2,880,468 | 2,741,630 |
Current liabilities: | ||
Accounts payable | 714,713 | 681,321 |
Accrued payroll expense | 65,616 | 102,266 |
Other accrued liabilities | 158,163 | 173,734 |
Operating lease liabilities | 28,331 | 29,348 |
Current maturities of long-term debt | 3,000 | 0 |
Borrowings on revolving credit | 174,000 | 29,000 |
Total current liabilities | 1,143,823 | 1,015,669 |
Long-term debt | 485,522 | 488,554 |
Non-current operating lease liabilities | 47,986 | 43,332 |
Other non-current liabilities | 161,029 | 151,440 |
Total liabilities | 1,838,360 | 1,698,995 |
Stockholders’ equity: | ||
Common stock, $0.01 par value: 600,000 shares authorized; 97,049 and 96,762 shares issued and outstanding | 970 | 968 |
Additional paid-in capital | 208,943 | 200,520 |
Accumulated other comprehensive loss | (103,577) | (81,516) |
Retained earnings | 934,567 | 921,704 |
Total Patterson Companies, Inc. stockholders' equity | 1,040,903 | 1,041,676 |
Noncontrolling interests | 1,205 | 959 |
Total stockholders’ equity | 1,042,108 | 1,042,635 |
Total liabilities and stockholders’ equity | $ 2,880,468 | $ 2,741,630 |
CONDENSED CONSOLIDATED BALANC_2
CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) $ in Thousands | Oct. 29, 2022 | Apr. 30, 2022 |
Statement of Financial Position [Abstract] | ||
Accounts receivable, allowance for doubtful accounts | $ 4,314 | $ 5,913 |
Common stock, par value, (in usd per share) | $ 0.01 | $ 0.01 |
Common stock, shares authorized | 600,000,000 | 600,000,000 |
Common Stock, shares, issued | 97,049,000 | 96,762,000 |
Common stock, shares outstanding | 97,049,000 | 96,762,000 |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENTS OF INCOME AND OTHER COMPREHENSIVE INCOME - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Oct. 29, 2022 | Oct. 30, 2021 | Oct. 29, 2022 | Oct. 30, 2021 | |
Income Statement [Abstract] | ||||
Net sales | $ 1,626,204 | $ 1,649,161 | $ 3,149,469 | $ 3,264,037 |
Cost of sales | 1,298,115 | 1,322,726 | 2,509,247 | 2,659,800 |
Gross profit | 328,089 | 326,435 | 640,222 | 604,237 |
Operating expenses | 267,994 | 263,575 | 545,283 | 580,906 |
Operating income | 60,095 | 62,860 | 94,939 | 23,331 |
Other income (expense): | ||||
Gains on investments | 0 | 0 | 0 | 87,827 |
Other income, net | 18,203 | 6,804 | 19,983 | 8,227 |
Interest expense | (7,544) | (5,521) | (13,107) | (10,716) |
Income before taxes | 70,754 | 64,143 | 101,815 | 108,669 |
Income tax expense | 17,105 | 16,205 | 23,906 | 26,929 |
Net income | 53,649 | 47,938 | 77,909 | 81,740 |
Net loss attributable to noncontrolling interests | (424) | (392) | (754) | (586) |
Net income attributable to Patterson Companies, Inc. | $ 54,073 | $ 48,330 | $ 78,663 | $ 82,326 |
Earnings per share attributable to Patterson Companies, Inc.: | ||||
Basic (in USD per share) | $ 0.56 | $ 0.50 | $ 0.81 | $ 0.85 |
Diluted (in USD per share) | $ 0.55 | $ 0.49 | $ 0.81 | $ 0.84 |
Weighted average shares: | ||||
Basic (in shares) | 96,913 | 97,321 | 96,771 | 97,089 |
Diluted (in shares) | 97,552 | 98,363 | 97,708 | 98,363 |
Dividends declared per common share (in USD per share) | $ 0.26 | $ 0.26 | $ 0.52 | $ 0.52 |
Comprehensive income: | ||||
Net income (loss) | $ 53,649 | $ 47,938 | $ 77,909 | $ 81,740 |
Foreign currency translation (loss) gain | (17,591) | 440 | (22,582) | 764 |
Cash flow hedges, net of tax | 260 | 260 | 521 | 521 |
Comprehensive income | $ 36,318 | $ 48,638 | $ 55,848 | $ 83,025 |
CONDENSED CONSOLIDATED STATEM_2
CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY - USD ($) $ in Thousands | Total | Common Stock | Additional Paid-in Capital | Accumulated Other Comprehensive Loss | Retained Earnings | Non-controlling Interests |
Beginning Balance at Apr. 24, 2021 | $ 964,671 | $ 968 | $ 169,099 | $ (62,592) | $ 855,741 | $ 1,455 |
Beginning Balance (in shares) at Apr. 24, 2021 | 96,813,000 | |||||
Foreign currency translation | 324 | 324 | ||||
Cash flow hedges | 261 | 261 | ||||
Net income (loss) | 33,802 | 33,996 | (194) | |||
Dividends declared | (25,540) | (25,540) | ||||
Common stock issued and related tax benefits | (752) | $ 4 | (756) | |||
Common stock issued and related tax benefits (in shares) | 422,000 | |||||
Stock-based compensation | 7,839 | 7,839 | ||||
Ending Balance at Jul. 31, 2021 | 980,605 | $ 972 | 176,182 | (62,007) | 864,197 | 1,261 |
Ending Balance (in shares) at Jul. 31, 2021 | 97,235,000 | |||||
Beginning Balance at Apr. 24, 2021 | 964,671 | $ 968 | 169,099 | (62,592) | 855,741 | 1,455 |
Beginning Balance (in shares) at Apr. 24, 2021 | 96,813,000 | |||||
Foreign currency translation | 764 | |||||
Cash flow hedges | 521 | |||||
Net income (loss) | 81,740 | |||||
Ending Balance at Oct. 30, 2021 | 1,011,982 | $ 975 | 184,548 | (61,307) | 886,897 | 869 |
Ending Balance (in shares) at Oct. 30, 2021 | 97,492,000 | |||||
Beginning Balance at Jul. 31, 2021 | 980,605 | $ 972 | 176,182 | (62,007) | 864,197 | 1,261 |
Beginning Balance (in shares) at Jul. 31, 2021 | 97,235,000 | |||||
Foreign currency translation | 440 | 440 | ||||
Cash flow hedges | 260 | 260 | ||||
Net income (loss) | 47,938 | 48,330 | (392) | |||
Dividends declared | (25,630) | (25,630) | ||||
Common stock issued and related tax benefits | 2,711 | $ 3 | 2,708 | |||
Common stock issued and related tax benefits (in shares) | 257,000 | |||||
Stock-based compensation | 5,658 | 5,658 | ||||
Ending Balance at Oct. 30, 2021 | 1,011,982 | $ 975 | 184,548 | (61,307) | 886,897 | 869 |
Ending Balance (in shares) at Oct. 30, 2021 | 97,492,000 | |||||
Foreign currency translation | (6,506) | (6,506) | ||||
Cash flow hedges | 261 | 261 | ||||
Net income (loss) | 56,575 | 57,006 | (431) | |||
Dividends declared | (25,592) | (25,592) | ||||
Common stock issued and related tax benefits | 2,071 | $ 1 | 2,070 | |||
Common stock issued and related tax benefits (in shares) | 95,000 | |||||
Stock-based compensation | 4,887 | 4,887 | ||||
Contribution from noncontrolling interest | 500 | 500 | ||||
Ending Balance at Jan. 29, 2022 | 1,044,178 | $ 976 | 191,505 | (67,552) | 918,311 | 938 |
Ending Balance (in shares) at Jan. 29, 2022 | 97,587,000 | |||||
Foreign currency translation | (14,224) | (14,224) | ||||
Cash flow hedges | 260 | 260 | ||||
Net income (loss) | 63,399 | 63,878 | (479) | |||
Dividends declared | (25,495) | (25,495) | ||||
Common stock issued and related tax benefits | 3,596 | $ 2 | 3,594 | |||
Common stock issued and related tax benefits (in shares) | 207,000 | |||||
Repurchases of common stock | (35,000) | $ (10) | (34,990) | |||
Repurchases of common stock (in shares) | (1,032,000) | |||||
Stock-based compensation | 5,421 | 5,421 | ||||
Contribution from noncontrolling interest | 500 | 500 | ||||
Ending Balance at Apr. 30, 2022 | $ 1,042,635 | $ 968 | 200,520 | (81,516) | 921,704 | 959 |
Ending Balance (in shares) at Apr. 30, 2022 | 96,762,000 | 96,762,000 | ||||
Foreign currency translation | $ (4,991) | (4,991) | ||||
Cash flow hedges | 261 | 261 | ||||
Net income (loss) | 24,260 | 24,590 | (330) | |||
Dividends declared | (25,667) | (25,667) | ||||
Common stock issued and related tax benefits | (2,142) | $ 6 | (2,148) | |||
Common stock issued and related tax benefits (in shares) | 653,000 | |||||
Repurchases of common stock | (15,000) | $ (5) | (14,995) | |||
Repurchases of common stock (in shares) | (516,000) | |||||
Stock-based compensation | 7,159 | 7,159 | ||||
Contribution from noncontrolling interest | 500 | 500 | ||||
Ending Balance at Jul. 30, 2022 | 1,027,015 | $ 969 | 205,531 | (86,246) | 905,632 | 1,129 |
Ending Balance (in shares) at Jul. 30, 2022 | 96,899,000 | |||||
Beginning Balance at Apr. 30, 2022 | $ 1,042,635 | $ 968 | 200,520 | (81,516) | 921,704 | 959 |
Beginning Balance (in shares) at Apr. 30, 2022 | 96,762,000 | 96,762,000 | ||||
Foreign currency translation | $ (22,582) | |||||
Cash flow hedges | 521 | |||||
Net income (loss) | 77,909 | |||||
Ending Balance at Oct. 29, 2022 | $ 1,042,108 | $ 970 | 208,943 | (103,577) | 934,567 | 1,205 |
Ending Balance (in shares) at Oct. 29, 2022 | 97,049,000 | 97,049,000 | ||||
Beginning Balance at Jul. 30, 2022 | $ 1,027,015 | $ 969 | 205,531 | (86,246) | 905,632 | 1,129 |
Beginning Balance (in shares) at Jul. 30, 2022 | 96,899,000 | |||||
Foreign currency translation | (17,591) | (17,591) | ||||
Cash flow hedges | 260 | 260 | ||||
Net income (loss) | 53,649 | 54,073 | (424) | |||
Dividends declared | (25,138) | (25,138) | ||||
Common stock issued and related tax benefits | 2,179 | $ 1 | 2,178 | |||
Common stock issued and related tax benefits (in shares) | 150,000 | |||||
Stock-based compensation | 1,234 | 1,234 | ||||
Contribution from noncontrolling interest | 500 | 500 | ||||
Ending Balance at Oct. 29, 2022 | $ 1,042,108 | $ 970 | $ 208,943 | $ (103,577) | $ 934,567 | $ 1,205 |
Ending Balance (in shares) at Oct. 29, 2022 | 97,049,000 | 97,049,000 |
CONDENSED CONSOLIDATED STATEM_3
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | 12 Months Ended | ||||||
Oct. 29, 2022 | Jul. 30, 2022 | Apr. 30, 2022 | Jan. 29, 2022 | Oct. 30, 2021 | Jul. 31, 2021 | Oct. 29, 2022 | Oct. 30, 2021 | Apr. 30, 2022 | |
Statement of Cash Flows [Abstract] | |||||||||
Net income (loss) | $ 53,649 | $ 24,260 | $ 63,399 | $ 56,575 | $ 47,938 | $ 33,802 | $ 77,909 | $ 81,740 | |
Adjustments to reconcile net income to net cash used in operating activities: | |||||||||
Depreciation | 22,412 | 21,825 | |||||||
Amortization | 18,678 | 19,155 | |||||||
Gains on investments | 0 | 0 | 0 | (87,827) | |||||
Non-cash employee compensation | 8,393 | 13,497 | |||||||
Non-cash losses (gains) and other, net | 5,085 | 3,974 | |||||||
Change in assets and liabilities: | |||||||||
Receivables | (508,811) | (583,939) | |||||||
Inventory | (100,596) | (90,728) | |||||||
Accounts payable | 41,557 | 165,250 | |||||||
Accrued liabilities | (47,519) | (56,029) | |||||||
Other changes from operating activities, net | (37,269) | (25,932) | |||||||
Net cash used in operating activities | (520,161) | (539,014) | |||||||
Investing activities: | |||||||||
Additions to property and equipment | (26,779) | (15,503) | |||||||
Collection of DPP receivable | 489,639 | 585,647 | |||||||
Payments related to acquisitions, net of cash acquired | 0 | (19,793) | |||||||
Payments related to investments | (15,000) | 0 | |||||||
Sale of investments | 0 | 57,245 | |||||||
Net cash provided by investing activities | 447,860 | 607,596 | |||||||
Financing activities: | |||||||||
Dividends paid | (50,732) | (50,407) | |||||||
Repurchases of common stock | (15,000) | 0 | |||||||
Draw (payment) on revolving credit | 145,000 | (10,000) | |||||||
Other financing activities | (1,766) | 1,959 | |||||||
Net cash provided by (used in) financing activities | 77,502 | (58,448) | |||||||
Effect of exchange rate changes on cash | (6,935) | 774 | |||||||
Net change in cash and cash equivalents | (1,734) | 10,908 | |||||||
Cash and cash equivalents at beginning of period | $ 142,014 | $ 154,152 | $ 143,244 | 142,014 | 143,244 | $ 143,244 | |||
Cash and cash equivalents at end of period | $ 140,280 | $ 142,014 | $ 154,152 | 140,280 | 154,152 | $ 142,014 | |||
Supplemental disclosure of non-cash investing activity: | |||||||||
Noncash investments acquired | $ 479,797 | $ 549,693 |
General
General | 6 Months Ended |
Oct. 29, 2022 | |
Accounting Policies [Abstract] | |
General | General Basis of Presentation In the opinion of management, the accompanying unaudited condensed consolidated financial statements contain all adjustments necessary to present fairly the financial position of Patterson Companies, Inc. (referred to herein as "Patterson" or in the first person notations "we," "our," and "us") as of October 29, 2022, and our results of operations and cash flows for the periods ended October 29, 2022 and October 30, 2021. Such adjustments are of a normal recurring nature. The results of operations for the three and six months ended October 29, 2022 are not necessarily indicative of the results to be expected for any other interim period or for the year ending April 29, 2023. These financial statements should be read in conjunction with the financial statements included in our 2022 Annual Report on Form 10-K filed on June 29, 2022. The unaudited condensed consolidated financial statements include the assets and liabilities of PDC Funding Company, LLC ("PDC Funding"), PDC Funding Company II, LLC ("PDC Funding II"), PDC Funding Company III, LLC ("PDC Funding III") and PDC Funding Company IV, LLC ("PDC Funding IV") , which are our wholly owned subsidiaries and separate legal entities formed under Minnesota law. PDC Funding and PDC Funding II are fully consolidated special purpose entities established to sell customer installment sale contracts to outside financial institutions in the normal course of their business. PDC Funding III and PDC Funding IV are fully consolidated special purpose entities established to sell certain receivables to unaffiliated financial institutions. The assets of PDC Funding, PDC Funding II, PDC Funding III and PDC Funding IV would be available first and foremost to satisfy the claims of its creditors. There are no known creditors of PDC Funding, PDC Funding II, PDC Funding III or PDC Funding IV. The unaudited condensed consolidated financial statements also include the assets and liabilities of Technology Partner Innovations, LLC, which is further described in Note 7. Fiscal Year End We operate with a 52-53 week accounting convention with our fiscal year ending on the last Saturday in April. The second quarter of fiscal 2023 and 2022 represents the 13 weeks ended October 29, 2022 and October 30, 2021, respectively. The six months ended October 29, 2022 and October 30, 2021 included 26 and 27 weeks, respectively. Fiscal 2023 will include 52 weeks and fiscal 2022 included 53 weeks. Other Income, Net Other income, net consisted of the following: Three Months Ended Six Months Ended October 29, 2022 October 30, 2021 October 29, 2022 October 30, 2021 Gain on interest rate swap agreements $ 13,072 $ 3,304 $ 11,124 $ 2,117 Investment income and other 5,131 3,500 8,859 6,110 Other income, net $ 18,203 $ 6,804 $ 19,983 $ 8,227 Comprehensive Income Comprehensive income is computed as net income including certain other items that are recorded directly to stockholders’ equity. Significant items included in comprehensive income are foreign currency translation adjustments and the effective portion of cash flow hedges, net of tax. Foreign currency translation adjustments do not include a provision for income tax because earnings from foreign operations are considered to be indefinitely reinvested outside the U.S. The income tax expense related to cash flow hedges was $81 and $81 for the three months ended October 29, 2022 and October 30, 2021, respectively and $161 and $161 for the six months ended October 29, 2022 and October 30, 2021, respectively. Earnings Per Share ("EPS") The following table sets forth the computation of the weighted average shares outstanding used to calculate basic and diluted EPS: Three Months Ended Six Months Ended October 29, 2022 October 30, 2021 October 29, 2022 October 30, 2021 Denominator for basic EPS – weighted average shares 96,913 97,321 96,771 97,089 Effect of dilutive securities – stock options, restricted stock and stock purchase plans 639 1,042 937 1,274 Denominator for diluted EPS – weighted average shares 97,552 98,363 97,708 98,363 Potentially dilutive securities representing 1,572 shares and 1,166 shares for the three and six months ended October 29, 2022 and 807 shares and 724 shares for the three and six months ended October 30, 2021 were excluded from the calculation of diluted EPS because their effects were anti-dilutive using the treasury stock method. Revenue Recognition Revenues are generated from the sale of consumable products, equipment and support, software and support, technical service parts and labor, and other sources. Revenues are recognized when or as performance obligations are satisfied. Performance obligations are satisfied when the customer obtains control of the goods or services. Consumable, equipment, software and parts sales are recorded upon delivery, except in those circumstances where terms of the sale are FOB shipping point, in which case sales are recorded upon shipment. Technical service labor is recognized as it is provided. Revenue derived from equipment and software support is recognized ratably over the period in which the support is provided. In addition to revenues generated from the distribution of consumable products under arrangements (buy/sell agreements) where the full market value of the product is recorded as revenue, we earn commissions for services provided under agency agreements. The agency agreement contrasts to a buy/sell agreement in that we do not have control over the transaction, as we do not have the primary responsibility of fulfilling the promise of the good or service and we do not bill or collect from the customer in an agency relationship. Commissions under agency agreements are recorded when the services are provided. Estimates for returns, damaged goods, rebates, loyalty programs and other revenue allowances are made at the time the revenue is recognized based on the historical experience for such items. The receivables that result from the recognition of revenue are reported net of related allowances. We maintain a valuation allowance based upon the expected collectability of receivables held. Estimates are used to determine the valuation allowance and are based on several factors, including historical collection data, current and forecasted economic trends and credit worthiness of customers. Receivables are written off when we determine the amounts to be uncollectible, typically upon customer bankruptcy or non-response to continuous collection efforts. The portions of receivable amounts that are not expected to be collected during the next twelve months are classified as long-term. Net sales do not include sales tax as we are considered a pass-through conduit for collecting and remitting sales tax. Contract Balances Contract balances represent amounts presented in our condensed consolidated balance sheets when either we have transferred goods or services to the customer or the customer has paid consideration to us under the contract. These contract balances include accounts receivable, contract assets and contract liabilities. Contract asset balances as of October 29, 2022 and April 30, 2022 were $2,327 and $134, respectively. Our contract liabilities primarily relate to advance payments from customers, upfront payments for software and support provided over time, and options that provide a material right to customers, such as our customer loyalty programs. At October 29, 2022 and April 30, 2022, contract liabilities of $39,405 and $38,581 were reported in other accrued liabilities, respectively. During the six months ended October 29, 2022, we recognized $22,490 of the amount previously deferred at April 30, 2022. Recently Issued Accounting Pronouncements The Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") No. 2020-04, “Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting” in March 2020 and ASU No. 2021-01, “Reference Rate Reform (Topic 848): Scope” in January 2021. These ASUs provide temporary optional expedients and exceptions to existing guidance on contract modifications and hedge accounting to facilitate the market transition from existing reference rates, such as LIBOR which began to be phased out at the end of 2021, to alternate reference rates. These standards were effective upon issuance. We are evaluating the optional relief guidance provided within these ASUs, and are reviewing our debt securities and derivative instruments that currently utilize LIBOR as the reference rate. |
Receivables Securitization Prog
Receivables Securitization Program | 6 Months Ended |
Oct. 29, 2022 | |
Transfers and Servicing [Abstract] | |
Receivables Securitization Program | Receivables Securitization Program We are party to certain receivables purchase agreements (the “Receivables Purchase Agreements”) with MUFG Bank, Ltd. ("MUFG") (f.k.a. The Bank of Tokyo-Mitsubishi UFJ, Ltd.), under which MUFG acts as an agent to facilitate the sale of certain Patterson receivables (the “Receivables”) to certain unaffiliated financial institutions (the “Purchasers”). The sale of these receivables is accounted for as a sale of assets under the provisions of ASC 860, Transfers and Servicing. We utilize PDC Funding III and PDC Funding IV to facilitate the sale to fulfill requirements within the agreement. We use a daily unit of account for these Receivables. The proceeds from the sale of these Receivables comprise a combination of cash and a deferred purchase price (“DPP”) receivable. The DPP receivable is ultimately realized by Patterson following the collection of the underlying Receivables sold to the Purchasers. The amount available under the Receivables Purchase Agreements fluctuates over time based on the total amount of eligible Receivables generated during the normal course of business, with maximum availability of $200,000 as of October 29, 2022, of which $200,000 was utilized. We have no retained interests in the transferred Receivables, other than our right to the DPP receivable and collection and administrative service fees. We consider the fees received adequate compensation for services rendered, and accordingly have recorded no servicing asset or liability. As of October 29, 2022 and April 30, 2022, the fair value of outstanding trade receivables transferred to the Purchasers under the facility and derecognized from the condensed consolidated balance sheets were $417,786 and $396,443, respectively. Sales of trade receivables under this facility were $1,826,156 and $1,877,460, and cash collections from customers on receivables sold were $1,804,576 and $1,855,260 during the six months ended October 29, 2022 and October 30, 2021, respectively. The DPP receivable is recorded at fair value within the condensed consolidated balance sheets within prepaid expenses and other current assets. The difference between the carrying amount of the Receivables and the sum of the cash and fair value of the DPP receivable received at time of transfer is recognized as a gain or loss on sale of the related Receivables inclusive of bank fees and allowance for credit losses. In operating expenses in the condensed consolidated statements of operations and other comprehensive income, we recorded losses of $3,211 and $894 during the three months ended October 29, 2022 and October 30, 2021, respectively, and $4,646 and $1,615 during the six months ended October 29, 2022 and October 30, 2021, respectively, related to the Receivables. The following rollforward summarizes the activity related to the DPP receivable: Six Months Ended October 29, 2022 October 30, 2021 Beginning DPP receivable balance $ 195,764 $ 183,999 Non-cash additions to DPP receivable 467,761 516,740 Collection of DPP receivable (447,241) (494,586) Ending DPP receivable balance $ 216,284 $ 206,153 |
Customer Financing
Customer Financing | 6 Months Ended |
Oct. 29, 2022 | |
Receivables [Abstract] | |
Customer Financing | Customer Financing As a convenience to our customers, we offer several different financing alternatives, including a third party program and a Patterson-sponsored program. For the third party program, we act as a facilitator between the customer and the third party financing entity with no on-going involvement in the financing transaction. Under the Patterson-sponsored program, equipment purchased by creditworthy customers may be financed up to a maximum of $1,000. We generally sell our customers’ financing contracts to outside financial institutions in the normal course of our business. These financing arrangements are accounted for as a sale of assets under the provisions of ASC 860, Transfers and Servicing. We currently have two arrangements under which we sell these contracts. We use a monthly unit of account for these financing contracts. First, we operate under an agreement to sell a portion of our equipment finance contracts to commercial paper conduits with MUFG serving as the agent. We utilize PDC Funding to fulfill a requirement of participating in the commercial paper conduit. We receive the proceeds of the contracts upon sale to MUFG. At least 15.0% of the proceeds are held by the conduit as security against eventual performance of the portfolio. This percentage can be greater and is based upon certain ratios defined in the agreement with MUFG. The capacity under the agreement with MUFG at October 29, 2022 was $525,000. Second, we maintain an agreement with Fifth Third Bank ("Fifth Third") whereby Fifth Third purchases customers’ financing contracts. PDC Funding II sells its financing contracts to Fifth Third. We receive the proceeds of the contracts upon sale to Fifth Third. At least 15.0% of the proceeds are held by the conduit as security against eventual performance of the portfolio. This percentage can be greater and is based upon certain ratios defined in the agreement with Fifth Third. The capacity under the agreement with Fifth Third at October 29, 2022 was $100,000. We service the financing contracts under both arrangements, for which we are paid a servicing fee. The servicing fees we receive are considered adequate compensation for services rendered. Accordingly, no servicing asset or liability has been recorded. The portion of the purchase price for the receivables held by the conduits is deemed a DPP receivable, which is paid to the applicable special purpose entity as payments on the customers’ financing contracts are collected by Patterson from customers. The difference between the carrying amount of the receivables sold under these programs and the sum of the cash and fair value of the DPP receivable received at time of transfer is recognized as a gain or loss on sale of the related receivables and recorded in net sales in the condensed consolidated statements of operations and other comprehensive income. Expenses incurred related to customer financing activities are recorded in operating expenses in our condensed consolidated statements of operations and other comprehensive income. During the six months ended October 29, 2022 and October 30, 2021, we sold $111,612 and $113,418 of contracts under these arrangements, respectively. In net sales in the condensed consolidated statements of operations and other comprehensive income, we recorded a loss of $8,456 and $3,363 during the three months ended October 29, 2022 and October 30, 2021, respectively, related to these contracts sold. In net sales in the condensed consolidated statements of operations and other comprehensive income, we recorded a loss of $7,468 and $3,290 during the six months ended October 29, 2022 and October 30, 2021, respectively, related to these contracts sold. Cash collections on financed receivables sold were $163,088 and $218,077 during the six months ended October 29, 2022 and October 30, 2021, respectively. Included in cash and cash equivalents in the condensed consolidated balance sheets are $33,342 and $39,106 as of October 29, 2022 and April 30, 2022, respectively, which represent cash collected from previously sold customer financing contracts that have not yet been settled. Included in current receivables in the condensed consolidated balance sheets are $56,562 and $58,190 as of October 29, 2022 and April 30, 2022, respectively, of finance contracts we have not yet sold. A total of $534,777 of finance contracts receivable sold under the arrangements was outstanding at October 29, 2022. Since the internal financing program began in 1994, bad debt write-offs have amounted to less than 1% of the loans originated. The following rollforward summarizes the activity related to the DPP receivable: Six Months Ended October 29, 2022 October 30, 2021 Beginning DPP receivable balance $ 125,332 $ 227,967 Non-cash additions to DPP receivable 12,036 32,953 Collection of DPP receivable (42,398) (91,061) Ending DPP receivable balance $ 94,970 $ 169,859 The arrangements require us to maintain a minimum current ratio and maximum leverage ratio. We were in compliance with those covenants at October 29, 2022. |
Derivative Financial Instrument
Derivative Financial Instruments | 6 Months Ended |
Oct. 29, 2022 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Derivative Financial Instruments | Derivative Financial Instruments We are a party to certain offsetting and identical interest rate cap agreements entered into to fulfill certain covenants of the equipment finance contract sale agreements. The interest rate cap agreements also provide a credit enhancement feature for the financing contracts sold by PDC Funding and PDC Funding II to the commercial paper conduit. The interest rate cap agreements are canceled and new agreements are entered into periodically to maintain consistency with the dollar maximum of the sale agreements and the maturity of the underlying financing contracts. As of October 29, 2022, PDC Funding had purchased an interest rate cap from a bank with a notional amount of $525,000 and a maturity date of August 2030. We sold an identical interest rate cap to the same bank. As of October 29, 2022, PDC Funding II had purchased an interest rate cap from a bank with a notional amount of $100,000 and a maturity date of September 2029. We sold an identical interest rate cap to the same bank. These interest rate cap agreements do not qualify for hedge accounting treatment and, accordingly, we record the fair value of the agreements as an asset or liability and the change in fair value as income or expense during the period in which the change occurs. In January 2014, we entered into a forward interest rate swap agreement with a notional amount of $250,000 and accounted for it as a cash flow hedge, in order to hedge interest rate fluctuations in anticipation of refinancing the 5.17% senior notes due March 25, 2015. These notes were repaid on March 25, 2015 and replaced with new $250,000 3.48% senior notes due March 24, 2025. A cash payment of $29,003 was made in March 2015 to settle the interest rate swap. This amount is recorded in other comprehensive income (loss), net of tax, and is recognized as interest expense over the life of the related debt. We utilize forward interest rate swap agreements to hedge against interest rate fluctuations that impact the amount of net sales we record related to our customer financing contracts. These interest rate swap agreements do not qualify for hedge accounting treatment and, accordingly, we record the fair value of the agreements as an asset or liability and the change in fair value as income or expense during the period in which the change occurs. As of April 30, 2022, the remaining notional amount for interest rate swap agreements was $574,144, with the latest maturity date in fiscal 2029. During the six months ended October 29, 2022, we entered into forward interest rate swap agreements with a notional amount of $79,010. As of October 29, 2022, the remaining notional amount for interest rate swap agreements was $538,519, with the latest maturity date in fiscal 2030. Net cash receipts of $782 were received and net cash payments of $3,992 were made during the six months ended October 29, 2022 and October 30, 2021, respectively, to settle a portion of our liabilities related to interest rate swap agreements. These payments and receipts are reflected as cash flows in the condensed consolidated statements of cash flows within net cash used in operating activities. The following presents the fair value of derivative instruments included in the condensed consolidated balance sheets: Derivative type Classification October 29, 2022 April 30, 2022 Assets: Interest rate contracts Prepaid expenses and other current assets $ 7,863 $ 3,875 Interest rate contracts Other non-current assets, net 33,512 19,871 Total asset derivatives $ 41,375 $ 23,746 Liabilities: Interest rate contracts Other accrued liabilities $ 199 $ 250 Interest rate contracts Other non-current liabilities 17,351 10,013 Total liability derivatives $ 17,550 $ 10,263 The following tables present the pre-tax effect of derivative instruments on the condensed consolidated statements of operations and other comprehensive income: Amount of Gain (Loss) Reclassified from Accumulated Other Comprehensive Loss into Income (Effective Portion) Three Months Ended Six Months Ended Derivatives in cash flow hedging relationships Statements of operations location October 29, 2022 October 30, 2021 October 29, 2022 October 30, 2021 Interest rate contracts Interest expense $ (341) $ (341) $ (682) $ (682) Amount of Gain (Loss) Recognized in Income on Derivatives Three Months Ended Six Months Ended Derivatives not designated as hedging instruments Statements of operations location October 29, 2022 October 30, 2021 October 29, 2022 October 30, 2021 Interest rate contracts Other income, net $ 13,072 $ 3,304 $ 11,124 $ 2,117 There were no gains or losses recognized in other comprehensive income (loss) on cash flow hedging derivatives during the three and six months ended October 29, 2022 or October 30, 2021. |
Fair Value Measurements
Fair Value Measurements | 6 Months Ended |
Oct. 29, 2022 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | Fair Value Measurements Fair value is the price at which an asset could be exchanged in a current transaction between knowledgeable, willing parties. The fair value hierarchy of measurements is categorized into one of three levels based on the lowest level of significant input used: Level 1 - Quoted prices in active markets for identical assets and liabilities at the measurement date. Level 2 - Observable inputs other than quoted prices included in Level 1, such as quoted prices for similar assets and liabilities in active markets; quoted prices for identical or similar assets and liabilities in markets that are not active; or other inputs that are observable or can be corroborated by observable market data. Level 3 - Unobservable inputs for which there is little or no market data available. These inputs reflect management’s assumptions of what market participants would use in pricing the asset or liability. Our hierarchy for assets and liabilities measured at fair value on a recurring basis is as follows: October 29, 2022 Total Level 1 Level 2 Level 3 Assets: Cash equivalents $ 1,419 $ 1,419 $ — $ — DPP receivable - receivables securitization program 216,284 — — 216,284 DPP receivable - customer financing 94,970 — — 94,970 Derivative instruments 41,375 — 41,375 — Total assets $ 354,048 $ 1,419 $ 41,375 $ 311,254 Liabilities: Derivative instruments $ 17,550 $ — $ 17,550 $ — April 30, 2022 Total Level 1 Level 2 Level 3 Assets: Cash equivalents $ 3,186 $ 3,186 $ — $ — DPP receivable - receivables securitization program 195,764 — — 195,764 DPP receivable - customer financing 125,332 — — 125,332 Derivative instruments 23,746 — 23,746 — Total assets $ 348,028 $ 3,186 $ 23,746 $ 321,096 Liabilities: Derivative instruments $ 10,263 $ — $ 10,263 $ — Cash equivalents – We value cash equivalents at their current market rates. The carrying value of cash equivalents approximates fair value and maturities are less than three months. DPP receivable - receivables securitization program – We value this DPP receivable based on a discounted cash flow analysis using unobservable inputs, which include the estimated timing of payments and the credit quality of the underlying creditor. Significant changes in any of the significant unobservable inputs in isolation would not result in a materially different fair value estimate. The interrelationship between these inputs is insignificant. DPP receivable - customer financing – We value this DPP receivable based on a discounted cash flow analysis using unobservable inputs, which include a forward yield curve, the estimated timing of payments and the credit quality of the underlying creditor. Significant changes in any of the significant unobservable inputs in isolation would not result in a materially different fair value estimate. The interrelationship between these inputs is insignificant. Derivative instruments – Our derivative instruments consist of interest rate cap agreements and interest rate swaps. These instruments are valued using inputs such as interest rates and credit spreads. Certain assets are measured at fair value on a non-recurring basis. These assets are not measured at fair value on an ongoing basis, but are subject to fair value adjustments under certain circumstances. We adjust the carrying value of our non-marketable equity securities to fair value when observable transactions of identical or similar securities occur, or due to an impairment. During the three months ended July 31, 2021, we sold a portion of our investment in Vetsource, a commercial partner and leading home delivery provider for veterinarians, with a carrying value of $25,814 for $56,849. We recorded a pre-tax gain of $31,035 in gains on investments in our condensed consolidated statements of operations and other comprehensive income as a result of this sale in the first quarter of fiscal 2022. The cash received of $56,849 is reported within investing activities in our condensed consolidated statements of cash flows. During the three months ended July 31, 2021, we also recorded a pre-tax non-cash gain of $31,035 to reflect the increase in the carrying value of the remaining portion of our investment in Vetsource, which was based on the selling price of the portion of the investment we sold for $56,849. This gain was recorded in gains on investments in our condensed consolidated statements of operations and other comprehensive income. The carrying value of the investment we owned following this sale was $56,849 and $56,849 as of October 29, 2022 and April 30, 2022, respectively. Concurrent with the sale completed in the first quarter of fiscal 2022, we obtained rights that will allow us, under certain circumstances, to require another shareholder of Vetsource to purchase our remaining shares. We recorded a pre-tax non-cash gain of $25,757 in gains on investments in our condensed consolidated statements of operations and other comprehensive income as a result of this transaction. The carrying value of this put option as of October 29, 2022 is $25,757, and is reported within investments in our condensed consolidated balance sheets. The aggregate gains on investments of $87,827 are reported within operating activities in our condensed consolidated statements of cash flows. Concurrent with obtaining this put option, we also granted rights to the same Vetsource shareholder that would allow such shareholder, under certain circumstances, to require us to sell our remaining shares at fair value. There were no fair value adjustments to such assets during the six months ended October 29, 2022. Our debt is not measured at fair value in the condensed consolidated balance sheets. The estimated fair value of our debt as of October 29, 2022 and April 30, 2022 was $480,533 and $489,777, respectively, as compared to a carrying value of $488,522 and $488,554 at October 29, 2022 and April 30, 2022, respectively. The fair value of debt was measured using a discounted cash flow analysis based on expected market based yields (i.e., Level 2 inputs). The carrying amounts of receivables, net of allowances, accounts payable, and certain accrued and other current liabilities approximated fair value at October 29, 2022 and April 30, 2022. |
Income Taxes
Income Taxes | 6 Months Ended |
Oct. 29, 2022 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income TaxesThe effective income tax rate for the three months ended October 29, 2022 was 24.2% compared to 25.3% for the three months ended October 30, 2021. The decrease in the rate for the three months ended October 29, 2022 was primarily due to a prior period income tax reserve adjustment, which was partially offset by excess tax benefits associated with stock-based compensation. The effective income tax rate for the six months ended October 29, 2022 was 23.5% compared to 24.8% for the six months ended October 30, 2021. The decrease in the rate for the six months ended October 29, 2022 was primarily due to a prior period income tax reserve adjustment. |
Technology Partner Innovations,
Technology Partner Innovations, LLC ("TPI") | 6 Months Ended |
Oct. 29, 2022 | |
Equity Method Investments and Joint Ventures [Abstract] | |
Technology Partner Innovations, LLC ("TPI") | Technology Partner Innovations, LLC ("TPI")In fiscal 2019, we entered into an agreement with Cure Partners to form TPI, which offers a cloud-based practice management software, NaVetor, to its customers. Patterson and Cure Partners each contributed net assets of $4,000 to form TPI. Patterson and Cure Partners each contributed additional net assets of $1,000 during the fiscal year ended April 30, 2022. Cure Partners contributed net assets of $1,000 during the six months ended October 29, 2022. We contributed net assets of $500 during the six months ended October 29, 2022, and we expect to contribute net assets of $500 by the end of fiscal 2023. We have determined that TPI is a variable interest entity, and we consolidate the results of operations of TPI as we have concluded that we are the primary beneficiary of TPI. Since TPI was formed, there have been no changes in ownership interests. As of October 29, 2022, we had noncontrolling interests of $1,205 on our condensed consolidated balance sheets. Net loss attributable to the noncontrolling interest was $424 and $392 for the three months ended October 29, 2022 and October 30, 2021, respectively, and $754 and $586 for the six months ended October 29, 2022 and October 30, 2021, respectively. |
Segment and Geographic Data
Segment and Geographic Data | 6 Months Ended |
Oct. 29, 2022 | |
Segment Reporting [Abstract] | |
Segment and Geographic Data | Segment and Geographic Data We present three reportable segments: Dental, Animal Health and Corporate. Dental and Animal Health are strategic business units that offer similar products and services to different customer bases. Dental provides a virtually complete range of consumable dental products, equipment and software, turnkey digital solutions and value-added services to dentists, dental laboratories, institutions, and other healthcare professionals throughout North America. Animal Health is a leading, full-line distributor in North America and the U.K. of animal health products, services and technologies to both the production-animal and companion-pet markets. Our Corporate segment is comprised of general and administrative expenses, including home office support costs in areas such as information technology, finance, legal, human resources and facilities. In addition, customer financing and other miscellaneous sales are reported within Corporate results. Corporate assets consist primarily of cash and cash equivalents, accounts receivable, property and equipment and long-term receivables. We evaluate segment performance based on operating income. The costs to operate the fulfillment centers are allocated to the operating units based on the through-put of the unit. The following table provides a breakdown of sales by geographic region: Three Months Ended Six Months Ended October 29, 2022 October 30, 2021 October 29, 2022 October 30, 2021 Consolidated net sales United States $ 1,375,622 $ 1,363,753 $ 2,636,020 $ 2,677,525 United Kingdom 157,125 184,006 319,346 376,753 Canada 93,457 101,402 194,103 209,759 Total $ 1,626,204 $ 1,649,161 $ 3,149,469 $ 3,264,037 Dental net sales United States $ 575,520 $ 561,574 $ 1,075,355 $ 1,102,647 Canada 53,403 60,641 111,485 126,435 Total $ 628,923 $ 622,215 $ 1,186,840 $ 1,229,082 Animal Health net sales United States $ 805,817 $ 802,700 $ 1,561,402 $ 1,570,180 United Kingdom 157,125 184,006 319,346 376,753 Canada 40,054 40,761 82,618 83,324 Total $ 1,002,996 $ 1,027,467 $ 1,963,366 $ 2,030,257 Corporate net sales United States $ (5,715) $ (521) $ (737) $ 4,698 Total $ (5,715) $ (521) $ (737) $ 4,698 The following table provides a breakdown of sales by categories of products and services: Three Months Ended Six Months Ended October 29, 2022 October 30, 2021 October 29, 2022 October 30, 2021 Consolidated net sales Consumable $ 1,301,256 $ 1,344,812 $ 2,563,025 $ 2,686,486 Equipment and software 243,896 223,813 417,831 407,265 Value-added services and other 81,052 80,536 168,613 170,286 Total $ 1,626,204 $ 1,649,161 $ 3,149,469 $ 3,264,037 Dental net sales Consumable $ 337,489 $ 356,654 $ 675,329 $ 733,230 Equipment and software 214,006 193,437 360,516 350,403 Value-added services and other 77,428 72,124 150,995 145,449 Total $ 628,923 $ 622,215 $ 1,186,840 $ 1,229,082 Animal Health net sales Consumable $ 963,767 $ 988,158 $ 1,887,696 $ 1,953,256 Equipment and software 29,890 30,376 57,315 56,862 Value-added services and other 9,339 8,933 18,355 20,139 Total $ 1,002,996 $ 1,027,467 $ 1,963,366 $ 2,030,257 Corporate net sales Value-added services and other $ (5,715) $ (521) $ (737) $ 4,698 Total $ (5,715) $ (521) $ (737) $ 4,698 The following table provides a breakdown of operating income (loss) by reportable segment: Three Months Ended Six Months Ended October 29, 2022 October 30, 2021 October 29, 2022 October 30, 2021 Operating income (loss) Dental $ 60,950 $ 55,570 $ 97,845 $ 54,484 Animal Health 28,316 26,135 50,175 49,940 Corporate (29,171) (18,845) (53,081) (81,093) Total $ 60,095 $ 62,860 $ 94,939 $ 23,331 The following table provides a breakdown of total assets by reportable segment: October 29, 2022 April 30, 2022 Total assets Dental $ 898,391 $ 851,746 Animal Health 1,567,024 1,459,450 Corporate 415,053 430,434 Total $ 2,880,468 $ 2,741,630 |
Accumulated Other Comprehensive
Accumulated Other Comprehensive Loss ("AOCL") | 6 Months Ended |
Oct. 29, 2022 | |
Equity [Abstract] | |
Accumulated Other Comprehensive Loss ("AOCL") | Accumulated Other Comprehensive Loss ("AOCL")The following table summarizes the changes in AOCL during the six months ended October 29, 2022: Cash Flow Hedges Currency Total AOCL at April 30, 2022 $ (3,454) $ (78,062) $ (81,516) Other comprehensive income before reclassifications — (22,582) (22,582) Amounts reclassified from AOCL 521 — 521 AOCL at October 29, 2022 $ (2,933) $ (100,644) $ (103,577) |
Legal Proceedings
Legal Proceedings | 6 Months Ended |
Oct. 29, 2022 | |
Commitments and Contingencies Disclosure [Abstract] | |
Legal Proceedings | Legal ProceedingsFrom time to time, we become involved in lawsuits, administrative proceedings, government subpoenas, and government investigations (which may, in some cases, involve our entering into settlement agreements or consent decrees), relating to antitrust, commercial, environmental, product liability, intellectual property, regulatory, employment discrimination, securities, and other matters, including matters arising out of the ordinary course of business. The results of any such proceedings cannot be predicted with certainty because such matters are inherently uncertain. Significant damages or penalties may be sought in some matters, and some matters may require years to resolve. We also may be subject to fines or penalties, and equitable remedies (including but not limited to the suspension, revocation or non-renewal of licenses). We accrue for these matters when it is both probable that a liability has been incurred and the amount of the loss can be reasonably estimated. Adverse outcomes may result in significant monetary damages or injunctive relief against us that could adversely affect our ability to conduct our business. There also exists the possibility of a material adverse effect on our financial statements for the period in which the effect of an unfavorable outcome becomes probable and reasonably estimable. |
Subsequent Events
Subsequent Events | 6 Months Ended |
Oct. 29, 2022 | |
Subsequent Events [Abstract] | |
Subsequent Events | Subsequent EventsDuring the third quarter of fiscal 2023, we signed an agreement to acquire substantially all of the assets of Relief Services for Veterinary Practitioners and Animal Care Technologies (RSVP and ACT), a Texas-based company that provides innovative solutions to veterinary practices through data extraction and conversion, staffing and video-based training services. Upon closing, which we expect to occur in the third quarter of fiscal 2023, we expect that the acquisition will expand our Companion Animal value-added platform by adding these solutions to the suite of offerings. Also during the third quarter of fiscal 2023, we signed an agreement to acquire substantially all of the assets of Dairy Tech, Inc., a Colorado-based company that provides pasteurizing equipment and single-use bags that allow dairy producers to produce, store and feed colostrum for newborn calves, as well as product offerings for beef cattle producers. Upon closing, which we expect to occur in the third quarter of fiscal 2023, we expect that the acquisition will expand our Production Animal value-added platform by adding these solutions to the suite of offerings. The aggregate cash consideration for these two acquisitions is $38,500. |
General (Policies)
General (Policies) | 6 Months Ended |
Oct. 29, 2022 | |
Accounting Policies [Abstract] | |
Basis of Presentation | Basis of Presentation In the opinion of management, the accompanying unaudited condensed consolidated financial statements contain all adjustments necessary to present fairly the financial position of Patterson Companies, Inc. (referred to herein as "Patterson" or in the first person notations "we," "our," and "us") as of October 29, 2022, and our results of operations and cash flows for the periods ended October 29, 2022 and October 30, 2021. Such adjustments are of a normal recurring nature. The results of operations for the three and six months ended October 29, 2022 are not necessarily indicative of the results to be expected for any other interim period or for the year ending April 29, 2023. These financial statements should be read in conjunction with the financial statements included in our 2022 Annual Report on Form 10-K filed on June 29, 2022. The unaudited condensed consolidated financial statements include the assets and liabilities of PDC Funding Company, LLC ("PDC Funding"), PDC Funding Company II, LLC ("PDC Funding II"), PDC Funding Company III, LLC ("PDC Funding III") and PDC Funding Company IV, LLC ("PDC Funding IV") , which are our wholly owned subsidiaries and separate legal entities formed under Minnesota law. PDC Funding and PDC Funding II are fully consolidated special purpose entities established to sell customer installment sale contracts to outside financial institutions in the normal course of their business. PDC Funding III and PDC Funding IV |
Fiscal Year End | Fiscal Year End We operate with a 52-53 week accounting convention with our fiscal year ending on the last Saturday in April. The second quarter of fiscal 2023 and 2022 represents the 13 weeks ended October 29, 2022 and October 30, 2021, respectively. The six months ended October 29, 2022 and October 30, 2021 included 26 and 27 weeks, respectively. Fiscal 2023 will include 52 weeks and fiscal 2022 included 53 weeks. |
Comprehensive Income | Comprehensive IncomeComprehensive income is computed as net income including certain other items that are recorded directly to stockholders’ equity. Significant items included in comprehensive income are foreign currency translation adjustments and the effective portion of cash flow hedges, net of tax. Foreign currency translation adjustments do not include a provision for income tax because earnings from foreign operations are considered to be indefinitely reinvested outside the U.S. |
Revenue Recognition | Revenue Recognition Revenues are generated from the sale of consumable products, equipment and support, software and support, technical service parts and labor, and other sources. Revenues are recognized when or as performance obligations are satisfied. Performance obligations are satisfied when the customer obtains control of the goods or services. Consumable, equipment, software and parts sales are recorded upon delivery, except in those circumstances where terms of the sale are FOB shipping point, in which case sales are recorded upon shipment. Technical service labor is recognized as it is provided. Revenue derived from equipment and software support is recognized ratably over the period in which the support is provided. In addition to revenues generated from the distribution of consumable products under arrangements (buy/sell agreements) where the full market value of the product is recorded as revenue, we earn commissions for services provided under agency agreements. The agency agreement contrasts to a buy/sell agreement in that we do not have control over the transaction, as we do not have the primary responsibility of fulfilling the promise of the good or service and we do not bill or collect from the customer in an agency relationship. Commissions under agency agreements are recorded when the services are provided. Estimates for returns, damaged goods, rebates, loyalty programs and other revenue allowances are made at the time the revenue is recognized based on the historical experience for such items. The receivables that result from the recognition of revenue are reported net of related allowances. We maintain a valuation allowance based upon the expected collectability of receivables held. Estimates are used to determine the valuation allowance and are based on several factors, including historical collection data, current and forecasted economic trends and credit worthiness of customers. Receivables are written off when we determine the amounts to be uncollectible, typically upon customer bankruptcy or non-response to continuous collection efforts. The portions of receivable amounts that are not expected to be collected during the next twelve months are classified as long-term. Net sales do not include sales tax as we are considered a pass-through conduit for collecting and remitting sales tax. Contract Balances Contract balances represent amounts presented in our condensed consolidated balance sheets when either we have transferred goods or services to the customer or the customer has paid consideration to us under the contract. These contract balances include accounts receivable, contract assets and contract liabilities. |
Recently Issued Accounting Pronouncements | Recently Issued Accounting Pronouncements The Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") No. 2020-04, “Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting” in March 2020 and ASU No. 2021-01, “Reference Rate Reform (Topic 848): Scope” in January 2021. These ASUs provide temporary optional expedients and exceptions to existing guidance on contract modifications and hedge accounting to facilitate the market transition from existing reference rates, such as LIBOR which began to be phased out at the end of 2021, to alternate reference rates. These standards were effective upon issuance. We are evaluating the optional relief guidance provided within these ASUs, and are reviewing our debt securities and derivative instruments that currently utilize LIBOR as the reference rate. |
General (Tables)
General (Tables) | 6 Months Ended |
Oct. 29, 2022 | |
Accounting Policies [Abstract] | |
Schedule of Other Income | Other income, net consisted of the following: Three Months Ended Six Months Ended October 29, 2022 October 30, 2021 October 29, 2022 October 30, 2021 Gain on interest rate swap agreements $ 13,072 $ 3,304 $ 11,124 $ 2,117 Investment income and other 5,131 3,500 8,859 6,110 Other income, net $ 18,203 $ 6,804 $ 19,983 $ 8,227 |
Computation of Basic and Diluted Earnings Per Share (EPS) | The following table sets forth the computation of the weighted average shares outstanding used to calculate basic and diluted EPS: Three Months Ended Six Months Ended October 29, 2022 October 30, 2021 October 29, 2022 October 30, 2021 Denominator for basic EPS – weighted average shares 96,913 97,321 96,771 97,089 Effect of dilutive securities – stock options, restricted stock and stock purchase plans 639 1,042 937 1,274 Denominator for diluted EPS – weighted average shares 97,552 98,363 97,708 98,363 |
Transfers and Servicing (Tables
Transfers and Servicing (Tables) | 6 Months Ended |
Oct. 29, 2022 | |
Transfers and Servicing [Abstract] | |
Schedule of Deferred Purchase Price Receivable | The following rollforward summarizes the activity related to the DPP receivable: Six Months Ended October 29, 2022 October 30, 2021 Beginning DPP receivable balance $ 195,764 $ 183,999 Non-cash additions to DPP receivable 467,761 516,740 Collection of DPP receivable (447,241) (494,586) Ending DPP receivable balance $ 216,284 $ 206,153 |
Customer Financing (Tables)
Customer Financing (Tables) | 6 Months Ended |
Oct. 29, 2022 | |
Receivables [Abstract] | |
Summary of Activity Related to DPP Receivable | The following rollforward summarizes the activity related to the DPP receivable: Six Months Ended October 29, 2022 October 30, 2021 Beginning DPP receivable balance $ 125,332 $ 227,967 Non-cash additions to DPP receivable 12,036 32,953 Collection of DPP receivable (42,398) (91,061) Ending DPP receivable balance $ 94,970 $ 169,859 |
Derivative Financial Instrume_2
Derivative Financial Instruments (Tables) | 6 Months Ended |
Oct. 29, 2022 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Fair Value of Derivative Instruments Included in Condensed Consolidated Balance Sheets | The following presents the fair value of derivative instruments included in the condensed consolidated balance sheets: Derivative type Classification October 29, 2022 April 30, 2022 Assets: Interest rate contracts Prepaid expenses and other current assets $ 7,863 $ 3,875 Interest rate contracts Other non-current assets, net 33,512 19,871 Total asset derivatives $ 41,375 $ 23,746 Liabilities: Interest rate contracts Other accrued liabilities $ 199 $ 250 Interest rate contracts Other non-current liabilities 17,351 10,013 Total liability derivatives $ 17,550 $ 10,263 |
Effect of Derivative instruments in Cash Flow Hedging Relationship on Condensed Consolidated Statements of Income and Other Comprehensive Income (OCI) | The following tables present the pre-tax effect of derivative instruments on the condensed consolidated statements of operations and other comprehensive income: Amount of Gain (Loss) Reclassified from Accumulated Other Comprehensive Loss into Income (Effective Portion) Three Months Ended Six Months Ended Derivatives in cash flow hedging relationships Statements of operations location October 29, 2022 October 30, 2021 October 29, 2022 October 30, 2021 Interest rate contracts Interest expense $ (341) $ (341) $ (682) $ (682) Amount of Gain (Loss) Recognized in Income on Derivatives Three Months Ended Six Months Ended Derivatives not designated as hedging instruments Statements of operations location October 29, 2022 October 30, 2021 October 29, 2022 October 30, 2021 Interest rate contracts Other income, net $ 13,072 $ 3,304 $ 11,124 $ 2,117 |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 6 Months Ended |
Oct. 29, 2022 | |
Fair Value Disclosures [Abstract] | |
Assets and Liabilities Measured at Fair Value on Recurring Basis | Our hierarchy for assets and liabilities measured at fair value on a recurring basis is as follows: October 29, 2022 Total Level 1 Level 2 Level 3 Assets: Cash equivalents $ 1,419 $ 1,419 $ — $ — DPP receivable - receivables securitization program 216,284 — — 216,284 DPP receivable - customer financing 94,970 — — 94,970 Derivative instruments 41,375 — 41,375 — Total assets $ 354,048 $ 1,419 $ 41,375 $ 311,254 Liabilities: Derivative instruments $ 17,550 $ — $ 17,550 $ — April 30, 2022 Total Level 1 Level 2 Level 3 Assets: Cash equivalents $ 3,186 $ 3,186 $ — $ — DPP receivable - receivables securitization program 195,764 — — 195,764 DPP receivable - customer financing 125,332 — — 125,332 Derivative instruments 23,746 — 23,746 — Total assets $ 348,028 $ 3,186 $ 23,746 $ 321,096 Liabilities: Derivative instruments $ 10,263 $ — $ 10,263 $ — |
Segment Reporting (Tables)
Segment Reporting (Tables) | 6 Months Ended |
Oct. 29, 2022 | |
Segment Reporting [Abstract] | |
Information about Reportable Segments | The following table provides a breakdown of sales by geographic region: Three Months Ended Six Months Ended October 29, 2022 October 30, 2021 October 29, 2022 October 30, 2021 Consolidated net sales United States $ 1,375,622 $ 1,363,753 $ 2,636,020 $ 2,677,525 United Kingdom 157,125 184,006 319,346 376,753 Canada 93,457 101,402 194,103 209,759 Total $ 1,626,204 $ 1,649,161 $ 3,149,469 $ 3,264,037 Dental net sales United States $ 575,520 $ 561,574 $ 1,075,355 $ 1,102,647 Canada 53,403 60,641 111,485 126,435 Total $ 628,923 $ 622,215 $ 1,186,840 $ 1,229,082 Animal Health net sales United States $ 805,817 $ 802,700 $ 1,561,402 $ 1,570,180 United Kingdom 157,125 184,006 319,346 376,753 Canada 40,054 40,761 82,618 83,324 Total $ 1,002,996 $ 1,027,467 $ 1,963,366 $ 2,030,257 Corporate net sales United States $ (5,715) $ (521) $ (737) $ 4,698 Total $ (5,715) $ (521) $ (737) $ 4,698 The following table provides a breakdown of sales by categories of products and services: Three Months Ended Six Months Ended October 29, 2022 October 30, 2021 October 29, 2022 October 30, 2021 Consolidated net sales Consumable $ 1,301,256 $ 1,344,812 $ 2,563,025 $ 2,686,486 Equipment and software 243,896 223,813 417,831 407,265 Value-added services and other 81,052 80,536 168,613 170,286 Total $ 1,626,204 $ 1,649,161 $ 3,149,469 $ 3,264,037 Dental net sales Consumable $ 337,489 $ 356,654 $ 675,329 $ 733,230 Equipment and software 214,006 193,437 360,516 350,403 Value-added services and other 77,428 72,124 150,995 145,449 Total $ 628,923 $ 622,215 $ 1,186,840 $ 1,229,082 Animal Health net sales Consumable $ 963,767 $ 988,158 $ 1,887,696 $ 1,953,256 Equipment and software 29,890 30,376 57,315 56,862 Value-added services and other 9,339 8,933 18,355 20,139 Total $ 1,002,996 $ 1,027,467 $ 1,963,366 $ 2,030,257 Corporate net sales Value-added services and other $ (5,715) $ (521) $ (737) $ 4,698 Total $ (5,715) $ (521) $ (737) $ 4,698 The following table provides a breakdown of operating income (loss) by reportable segment: Three Months Ended Six Months Ended October 29, 2022 October 30, 2021 October 29, 2022 October 30, 2021 Operating income (loss) Dental $ 60,950 $ 55,570 $ 97,845 $ 54,484 Animal Health 28,316 26,135 50,175 49,940 Corporate (29,171) (18,845) (53,081) (81,093) Total $ 60,095 $ 62,860 $ 94,939 $ 23,331 The following table provides a breakdown of total assets by reportable segment: October 29, 2022 April 30, 2022 Total assets Dental $ 898,391 $ 851,746 Animal Health 1,567,024 1,459,450 Corporate 415,053 430,434 Total $ 2,880,468 $ 2,741,630 |
Accumulated Other Comprehensi_2
Accumulated Other Comprehensive Loss ("AOCL") (Tables) | 6 Months Ended |
Oct. 29, 2022 | |
Equity [Abstract] | |
Summary of Accumulated Other Comprehensive Loss | The following table summarizes the changes in AOCL during the six months ended October 29, 2022: Cash Flow Hedges Currency Total AOCL at April 30, 2022 $ (3,454) $ (78,062) $ (81,516) Other comprehensive income before reclassifications — (22,582) (22,582) Amounts reclassified from AOCL 521 — 521 AOCL at October 29, 2022 $ (2,933) $ (100,644) $ (103,577) |
General - Additional Informatio
General - Additional Information (Detail) - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Oct. 29, 2022 | Oct. 30, 2021 | Oct. 29, 2022 | Oct. 30, 2021 | |
Accounting Policies [Abstract] | ||||
Income tax expense related to cash flow hedges | $ 81 | $ 81 | $ 161 | $ 161 |
Securities excluded from calculation of diluted earnings per share (in shares) | 1,572 | 807 | 1,166 | 724 |
General - Schedule of Other Inc
General - Schedule of Other Income, Net (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Oct. 29, 2022 | Oct. 30, 2021 | Oct. 29, 2022 | Oct. 30, 2021 | |
Accounting Policies [Abstract] | ||||
Gain on interest rate swap agreements | $ 13,072 | $ 3,304 | $ 11,124 | $ 2,117 |
Investment income and other | 5,131 | 3,500 | 8,859 | 6,110 |
Other income, net | $ 18,203 | $ 6,804 | $ 19,983 | $ 8,227 |
General - Computation of Basic
General - Computation of Basic and Diluted Earnings Per Share (EPS) (Detail) - shares shares in Thousands | 3 Months Ended | 6 Months Ended | ||
Oct. 29, 2022 | Oct. 30, 2021 | Oct. 29, 2022 | Oct. 30, 2021 | |
Earnings Per Share [Abstract] | ||||
Denominator for basic earnings per share – weighted average shares (in shares) | 96,913 | 97,321 | 96,771 | 97,089 |
Effect of dilutive securities - stock options, restricted stock and stock purchase plans (in shares) | 639 | 1,042 | 937 | 1,274 |
Denominator for diluted earnings per share – weighted average shares (in shares) | 97,552 | 98,363 | 97,708 | 98,363 |
General - Contract Balances (De
General - Contract Balances (Details) - USD ($) $ in Thousands | 6 Months Ended | |
Oct. 29, 2022 | Apr. 30, 2022 | |
Accounting Policies [Abstract] | ||
Contract assets | $ 2,327 | $ 134 |
Contract liability | 39,405 | $ 38,581 |
Contract liability, revenue recognized | $ 22,490 |
Receivables Securitization Pr_2
Receivables Securitization Program - Narrative (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | |||
Oct. 29, 2022 | Oct. 30, 2021 | Oct. 29, 2022 | Oct. 30, 2021 | Apr. 30, 2022 | |
Transfer of Certain Financial Assets Accounted for as Secured Borrowings [Line Items] | |||||
Proceeds from Receivables sold | $ 163,088 | $ 218,077 | |||
Loss on sale of receivables | $ 3,211 | $ 894 | 4,646 | 1,615 | |
Receivables Purchase Agreements | |||||
Transfer of Certain Financial Assets Accounted for as Secured Borrowings [Line Items] | |||||
Eligible receivables, maximum available under Purchase Agreement | 200,000 | 200,000 | |||
Eligible receivables, amount utilized under Purchase Agreement | 200,000 | 200,000 | |||
Receivables sold, fair value | $ 417,786 | 417,786 | $ 396,443 | ||
Trade receivables sold | 1,826,156 | 1,877,460 | |||
Proceeds from Receivables sold | $ 1,804,576 | $ 1,855,260 |
Receivables Securitization Pr_3
Receivables Securitization Program - Activity in DPP Receivable (Details) - USD ($) $ in Thousands | 6 Months Ended | |
Oct. 29, 2022 | Oct. 30, 2021 | |
Transfer of Certain Financial Assets Accounted for as Secured Borrowings [Line Items] | ||
Collection of DPP receivable | $ (489,639) | $ (585,647) |
Receivables Purchase Agreements | ||
Transfer of Certain Financial Assets Accounted for as Secured Borrowings [Line Items] | ||
Beginning DPP receivable balance | 195,764 | 183,999 |
Non-cash additions to DPP receivable | 467,761 | 516,740 |
Collection of DPP receivable | (447,241) | (494,586) |
Ending DPP receivable balance | $ 216,284 | $ 206,153 |
Customer Financing (Detail)
Customer Financing (Detail) | 3 Months Ended | 6 Months Ended | |||
Oct. 29, 2022 USD ($) | Oct. 30, 2021 USD ($) | Oct. 29, 2022 USD ($) financingAgreement | Oct. 30, 2021 USD ($) | Apr. 30, 2022 USD ($) | |
Customer Financing [Line Items] | |||||
Maximum credit financed for equipment purchases for any one customer | $ 1,000,000 | $ 1,000,000 | |||
Number of customer financing contracts | financingAgreement | 2 | ||||
Financing contracts sold | $ 111,612,000 | $ 113,418,000 | |||
Gain (loss) on sale of financing contracts | (3,211,000) | $ (894,000) | (4,646,000) | (1,615,000) | |
Proceeds from Receivables sold | 163,088,000 | 218,077,000 | |||
Cash and cash equivalents | 140,280,000 | 140,280,000 | $ 142,014,000 | ||
Current receivables of finance contracts not yet sold | 56,562,000 | 56,562,000 | 58,190,000 | ||
Finance contracts receivable sold and outstanding | 534,777,000 | $ 534,777,000 | |||
Bad debt write-offs, percentage (less than) | 1% | ||||
Unsettled Financing Arrangements | |||||
Customer Financing [Line Items] | |||||
Cash and cash equivalents | 33,342,000 | $ 33,342,000 | $ 39,106,000 | ||
Customer Finance Contracts | |||||
Customer Financing [Line Items] | |||||
Gain (loss) on sale of financing contracts | (8,456,000) | $ (3,363,000) | $ (7,468,000) | $ (3,290,000) | |
The Bank of Tokyo-Mitsubishi UFJ, Ltd. | |||||
Customer Financing [Line Items] | |||||
Percentage of principal amount of financing contracts held as collateral (at least) | 15% | ||||
Capacity under agreement | 525,000,000 | $ 525,000,000 | |||
Fifth Third Bank | |||||
Customer Financing [Line Items] | |||||
Percentage of principal amount of financing contracts held as collateral (at least) | 15% | ||||
Capacity under agreement | $ 100,000,000 | $ 100,000,000 |
Customer Financing - Activity i
Customer Financing - Activity in DPP Receivables (Details) - USD ($) $ in Thousands | 6 Months Ended | |
Oct. 29, 2022 | Oct. 30, 2021 | |
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Collection of DPP receivable | $ (489,639) | $ (585,647) |
Customer Finance Contracts | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Beginning DPP receivable balance | 125,332 | 227,967 |
Non-cash additions to DPP receivable | 12,036 | 32,953 |
Collection of DPP receivable | (42,398) | (91,061) |
Ending DPP receivable balance | $ 94,970 | $ 169,859 |
Derivative Financial Instrume_3
Derivative Financial Instruments - Additional Information (Detail) - USD ($) | 1 Months Ended | 3 Months Ended | 6 Months Ended | |||||
Mar. 31, 2015 | Oct. 29, 2022 | Oct. 30, 2021 | Oct. 29, 2022 | Oct. 30, 2021 | Apr. 30, 2022 | Mar. 25, 2015 | Jan. 31, 2014 | |
Derivative [Line Items] | ||||||||
Gains or losses recognized in OCI on cash flow hedging derivative | $ 0 | $ 0 | ||||||
Ineffectiveness recorded during period | 0 | 0 | ||||||
Increase (decrease) in interest expense | $ (1,363,000) | |||||||
5.17% Senior Notes | ||||||||
Derivative [Line Items] | ||||||||
Interest rate | 5.17% | |||||||
3.48% Senior Notes due 2025 | ||||||||
Derivative [Line Items] | ||||||||
Interest rate | 3.48% | |||||||
Aggregate principal amount | $ 250,000,000 | |||||||
Interest Rate Cap | ||||||||
Derivative [Line Items] | ||||||||
Derivative, notional amount | 525,000,000 | 525,000,000 | ||||||
New Interest Rate Cap | ||||||||
Derivative [Line Items] | ||||||||
Derivative, notional amount | 100,000,000 | 100,000,000 | ||||||
Interest Rate Swap Agreement | ||||||||
Derivative [Line Items] | ||||||||
Derivative, notional amount | $ 250,000,000 | |||||||
Payments for (proceeds from) to settle interest rate swaps | $ 29,003,000 | 3,992,000 | (782,000) | |||||
Interest Rate Swap | ||||||||
Derivative [Line Items] | ||||||||
Derivative, notional amount | 538,519,000 | 538,519,000 | $ 574,144,000 | |||||
Increase (decrease) in interest expense | (341,000) | $ (341,000) | (682,000) | $ (682,000) | ||||
Interest Rate Swap Two | ||||||||
Derivative [Line Items] | ||||||||
Derivative, notional amount | $ 79,010,000 | $ 79,010,000 |
Derivative Financial Instrume_4
Derivative Financial Instruments - Fair Value of Derivative Instruments Included in Condensed Consolidated Balance Sheets (Detail) - USD ($) $ in Thousands | Oct. 29, 2022 | Apr. 30, 2022 |
Derivatives, Fair Value [Line Items] | ||
Interest rate contracts, assets, fair value | $ 41,375 | $ 23,746 |
Interest rate contracts, liabilities, fair value | 17,550 | 10,263 |
Interest rate contracts | Prepaid Expenses and Other Current Assets | ||
Derivatives, Fair Value [Line Items] | ||
Interest rate contracts, assets, fair value | 7,863 | 3,875 |
Interest rate contracts | Other Noncurrent Assets | ||
Derivatives, Fair Value [Line Items] | ||
Interest rate contracts, assets, fair value | 33,512 | 19,871 |
Interest rate contracts | Other Accrued Liabilities | ||
Derivatives, Fair Value [Line Items] | ||
Interest rate contracts, liabilities, fair value | 199 | 250 |
Interest rate contracts | Other Noncurrent Liabilities | ||
Derivatives, Fair Value [Line Items] | ||
Interest rate contracts, liabilities, fair value | $ 17,351 | $ 10,013 |
Derivative Financial Instrume_5
Derivative Financial Instruments - Effect of Derivative Instruments in Cash Flow Hedging Relationships on Condensed Consolidated Statements of Income and Other Comprehensive Income (Detail) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Oct. 29, 2022 | Oct. 30, 2021 | Oct. 29, 2022 | Oct. 30, 2021 | |
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Accumulated other comprehensive loss expected to be reclassified into earnings | $ (1,363) | |||
Gain (loss) recognized in income on derivative | $ 13,072 | $ 3,304 | 11,124 | $ 2,117 |
Interest rate contract | ||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Accumulated other comprehensive loss expected to be reclassified into earnings | (341) | (341) | (682) | (682) |
Interest rate contract | Other income, net | Not Designated as Hedging Instrument | ||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Gain (loss) recognized in income on derivative | $ 13,072 | $ 3,304 | $ 11,124 | $ 2,117 |
Fair Value Measurements - Asset
Fair Value Measurements - Assets and Liabilities Measured at Fair Value on Recurring Basis (Detail) - USD ($) $ in Thousands | Oct. 29, 2022 | Apr. 30, 2022 |
Assets: | ||
Cash equivalents | $ 1,419 | $ 3,186 |
DPP receivable - receivables securitization program | 216,284 | 195,764 |
DPP receivable - customer financing | 94,970 | 125,332 |
Derivative instruments | 41,375 | 23,746 |
Total assets | 354,048 | 348,028 |
Liabilities: | ||
Derivative instruments | 17,550 | 10,263 |
Fair Value, Inputs, Level 1 | ||
Assets: | ||
Cash equivalents | 1,419 | 3,186 |
DPP receivable - receivables securitization program | 0 | 0 |
DPP receivable - customer financing | 0 | 0 |
Derivative instruments | 0 | 0 |
Total assets | 1,419 | 3,186 |
Liabilities: | ||
Derivative instruments | 0 | 0 |
Fair Value, Inputs, Level 2 | ||
Assets: | ||
Cash equivalents | 0 | 0 |
DPP receivable - receivables securitization program | 0 | 0 |
DPP receivable - customer financing | 0 | 0 |
Derivative instruments | 41,375 | 23,746 |
Total assets | 41,375 | 23,746 |
Liabilities: | ||
Derivative instruments | 17,550 | 10,263 |
Fair Value, Inputs, Level 3 | ||
Assets: | ||
Cash equivalents | 0 | 0 |
DPP receivable - receivables securitization program | 216,284 | 195,764 |
DPP receivable - customer financing | 94,970 | 125,332 |
Derivative instruments | 0 | 0 |
Total assets | 311,254 | 321,096 |
Liabilities: | ||
Derivative instruments | $ 0 | $ 0 |
Fair Value Measurements - Addit
Fair Value Measurements - Additional Information (Detail) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||||
Oct. 29, 2022 | Oct. 30, 2021 | Jul. 31, 2021 | Oct. 29, 2022 | Oct. 30, 2021 | Apr. 30, 2022 | |
Schedule of Investments [Line Items] | ||||||
Gains on investments | $ 0 | $ 0 | $ 0 | $ 87,827 | ||
Estimated fair value of debt | 480,533 | 480,533 | $ 489,777 | |||
Carrying value of debt | 488,522 | 488,522 | 488,554 | |||
Vetsource | ||||||
Schedule of Investments [Line Items] | ||||||
Carrying value of investment | 56,849 | $ 25,814 | 56,849 | $ 56,849 | ||
Proceeds from sale of investment | 56,849 | |||||
Gain on sale of investment | 31,035 | |||||
Noncash gain on investments | 31,035 | |||||
Gain on investment put option | $ 25,757 | |||||
Carrying value, put option | $ 25,757 | $ 25,757 | ||||
Gains on investments | $ 87,827 |
Income Taxes (Detail)
Income Taxes (Detail) | 3 Months Ended | 6 Months Ended | ||
Oct. 29, 2022 | Oct. 30, 2021 | Oct. 29, 2022 | Oct. 30, 2021 | |
Income Tax Disclosure [Abstract] | ||||
Effective income tax rate | 24.20% | 25.30% | 23.50% | 24.80% |
Technology Partner Innovation_2
Technology Partner Innovations, LLC ("TPI") (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | 12 Months Ended | ||||
Oct. 29, 2022 | Oct. 30, 2021 | Jul. 27, 2019 | Apr. 29, 2023 | Oct. 29, 2022 | Oct. 30, 2021 | Apr. 30, 2022 | |
Schedule of Equity Method Investments [Line Items] | |||||||
Net assets contributed | $ 15,000 | $ 0 | |||||
Noncontrolling interest | $ 1,205 | 1,205 | $ 959 | ||||
Net loss attributable to noncontrolling interest | 424 | $ 392 | 754 | 586 | |||
Technology Partner Innovations, LLC | |||||||
Schedule of Equity Method Investments [Line Items] | |||||||
Net assets contributed | $ 4,000 | 500 | $ 1,000 | ||||
Net loss attributable to noncontrolling interest | $ 424 | $ 392 | 754 | $ 586 | |||
Technology Partner Innovations, LLC | Subsequent Event | Forecast | |||||||
Schedule of Equity Method Investments [Line Items] | |||||||
Net assets contributed | $ 500 | ||||||
Technology Partner Innovations, LLC | Cure Partners | |||||||
Schedule of Equity Method Investments [Line Items] | |||||||
Net assets from noncontrolling Interests | $ 1,000 |
Segment Reporting - Narrative (
Segment Reporting - Narrative (Detail) | 6 Months Ended |
Oct. 29, 2022 Segment | |
Segment Reporting [Abstract] | |
Number of reportable segments | 3 |
Segment Reporting - Information
Segment Reporting - Information about Reportable Segments (Detail) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | |||
Oct. 29, 2022 | Oct. 30, 2021 | Oct. 29, 2022 | Oct. 30, 2021 | Apr. 30, 2022 | |
Segment Reporting Information [Line Items] | |||||
Net sales | $ 1,626,204 | $ 1,649,161 | $ 3,149,469 | $ 3,264,037 | |
Operating income (loss) | 60,095 | 62,860 | 94,939 | 23,331 | |
Total assets | 2,880,468 | 2,880,468 | $ 2,741,630 | ||
Consumable | |||||
Segment Reporting Information [Line Items] | |||||
Net sales | 1,301,256 | 1,344,812 | 2,563,025 | 2,686,486 | |
Equipment and software | |||||
Segment Reporting Information [Line Items] | |||||
Net sales | 243,896 | 223,813 | 417,831 | 407,265 | |
Value-added services and other | |||||
Segment Reporting Information [Line Items] | |||||
Net sales | 81,052 | 80,536 | 168,613 | 170,286 | |
Dental | |||||
Segment Reporting Information [Line Items] | |||||
Net sales | 628,923 | 622,215 | 1,186,840 | 1,229,082 | |
Dental | Operating Segments | |||||
Segment Reporting Information [Line Items] | |||||
Operating income (loss) | 60,950 | 55,570 | 97,845 | 54,484 | |
Total assets | 898,391 | 898,391 | 851,746 | ||
Dental | Consumable | |||||
Segment Reporting Information [Line Items] | |||||
Net sales | 337,489 | 356,654 | 675,329 | 733,230 | |
Dental | Equipment and software | |||||
Segment Reporting Information [Line Items] | |||||
Net sales | 214,006 | 193,437 | 360,516 | 350,403 | |
Dental | Value-added services and other | |||||
Segment Reporting Information [Line Items] | |||||
Net sales | 77,428 | 72,124 | 150,995 | 145,449 | |
Animal Health | |||||
Segment Reporting Information [Line Items] | |||||
Net sales | 1,002,996 | 1,027,467 | 1,963,366 | 2,030,257 | |
Animal Health | Operating Segments | |||||
Segment Reporting Information [Line Items] | |||||
Operating income (loss) | 28,316 | 26,135 | 50,175 | 49,940 | |
Total assets | 1,567,024 | 1,567,024 | 1,459,450 | ||
Animal Health | Consumable | |||||
Segment Reporting Information [Line Items] | |||||
Net sales | 963,767 | 988,158 | 1,887,696 | 1,953,256 | |
Animal Health | Equipment and software | |||||
Segment Reporting Information [Line Items] | |||||
Net sales | 29,890 | 30,376 | 57,315 | 56,862 | |
Animal Health | Value-added services and other | |||||
Segment Reporting Information [Line Items] | |||||
Net sales | 9,339 | 8,933 | 18,355 | 20,139 | |
Corporate | |||||
Segment Reporting Information [Line Items] | |||||
Net sales | (5,715) | (521) | (737) | 4,698 | |
Corporate | Operating Segments | |||||
Segment Reporting Information [Line Items] | |||||
Operating income (loss) | (29,171) | (18,845) | (53,081) | (81,093) | |
Total assets | 415,053 | 415,053 | $ 430,434 | ||
Corporate | Value-added services and other | |||||
Segment Reporting Information [Line Items] | |||||
Net sales | (5,715) | (521) | (737) | 4,698 | |
United States | |||||
Segment Reporting Information [Line Items] | |||||
Net sales | 1,375,622 | 1,363,753 | 2,636,020 | 2,677,525 | |
United States | Dental | |||||
Segment Reporting Information [Line Items] | |||||
Net sales | 575,520 | 561,574 | 1,075,355 | 1,102,647 | |
United States | Animal Health | |||||
Segment Reporting Information [Line Items] | |||||
Net sales | 805,817 | 802,700 | 1,561,402 | 1,570,180 | |
United States | Corporate | |||||
Segment Reporting Information [Line Items] | |||||
Net sales | (5,715) | (521) | (737) | 4,698 | |
United Kingdom | |||||
Segment Reporting Information [Line Items] | |||||
Net sales | 157,125 | 184,006 | 319,346 | 376,753 | |
United Kingdom | Animal Health | |||||
Segment Reporting Information [Line Items] | |||||
Net sales | 157,125 | 184,006 | 319,346 | 376,753 | |
Canada | |||||
Segment Reporting Information [Line Items] | |||||
Net sales | 93,457 | 101,402 | 194,103 | 209,759 | |
Canada | Dental | |||||
Segment Reporting Information [Line Items] | |||||
Net sales | 53,403 | 60,641 | 111,485 | 126,435 | |
Canada | Animal Health | |||||
Segment Reporting Information [Line Items] | |||||
Net sales | $ 40,054 | $ 40,761 | $ 82,618 | $ 83,324 |
Accumulated Other Comprehensi_3
Accumulated Other Comprehensive Loss ("AOCL") - Summary of Accumulated Other Comprehensive Loss (Detail) $ in Thousands | 6 Months Ended |
Oct. 29, 2022 USD ($) | |
AOCI Attributable to Parent, Net of Tax [Roll Forward] | |
Beginning Balance | $ 1,041,676 |
Ending Balance | 1,040,903 |
Cash Flow Hedges | |
AOCI Attributable to Parent, Net of Tax [Roll Forward] | |
Beginning Balance | (3,454) |
Other comprehensive income before reclassifications | 0 |
Amounts reclassified from AOCL | 521 |
Ending Balance | (2,933) |
Currency Translation Adjustment | |
AOCI Attributable to Parent, Net of Tax [Roll Forward] | |
Beginning Balance | (78,062) |
Other comprehensive income before reclassifications | (22,582) |
Amounts reclassified from AOCL | 0 |
Ending Balance | (100,644) |
Total | |
AOCI Attributable to Parent, Net of Tax [Roll Forward] | |
Beginning Balance | (81,516) |
Other comprehensive income before reclassifications | (22,582) |
Amounts reclassified from AOCL | 521 |
Ending Balance | $ (103,577) |
Accumulated Other Comprehensi_4
Accumulated Other Comprehensive Loss ("AOCL") - Additional Information (Detail) $ in Thousands | 6 Months Ended |
Oct. 29, 2022 USD ($) | |
Equity [Abstract] | |
Income tax expense related t cash flow hedges | $ 161 |
Increase in interest expense | $ 682 |
Subsequent Events (Details)
Subsequent Events (Details) $ in Thousands | 3 Months Ended | 6 Months Ended | |
Jan. 28, 2023 USD ($) acquisition | Oct. 29, 2022 USD ($) | Oct. 30, 2021 USD ($) | |
Subsequent Event [Line Items] | |||
Cash consideration for acquisitions | $ 0 | $ 19,793 | |
Subsequent Event | Forecast | 2023 Third Quarter Acquisitions | |||
Subsequent Event [Line Items] | |||
Number of acquisitions | acquisition | 2 | ||
Cash consideration for acquisitions | $ 38,500 |