Document and Entity Information
Document and Entity Information - shares | 3 Months Ended | |
Aug. 01, 2015 | Sep. 03, 2015 | |
Document And Entity Information [Abstract] | ||
Document Type | 10-Q | |
Amendment Flag | false | |
Document Period End Date | Aug. 1, 2015 | |
Document Fiscal Year Focus | 2,016 | |
Document Fiscal Period Focus | Q1 | |
Trading Symbol | PDCO | |
Entity Registrant Name | PATTERSON COMPANIES, INC. | |
Entity Central Index Key | 891,024 | |
Current Fiscal Year End Date | --04-30 | |
Entity Filer Category | Large Accelerated Filer | |
Entity Common Stock, Shares Outstanding | 103,248,000 |
CONDENSED CONSOLIDATED BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Aug. 01, 2015 | Apr. 25, 2015 |
Current assets: | ||
Cash and cash equivalents | $ 186,440 | $ 347,260 |
Short-term investments | 49,651 | 53,372 |
Receivables, net of allowance for doubtful accounts | 624,340 | 586,263 |
Inventory | 716,707 | 408,422 |
Prepaid expenses and other current assets | 94,358 | 59,561 |
Current assets held for sale | 130,306 | 118,347 |
Total current assets | 1,801,802 | 1,573,225 |
Property and equipment, net | 258,964 | 204,133 |
Long-term receivables, net | 84,269 | 71,686 |
Goodwill | 817,481 | 299,924 |
Identifiable intangibles, net | 551,337 | 125,025 |
Other | 89,045 | 37,919 |
Long-term assets held for sale | 636,756 | 635,794 |
Total assets | 4,239,654 | 2,947,706 |
Current liabilities: | ||
Accounts payable | 456,259 | 323,294 |
Accrued payroll expense | 33,077 | 72,464 |
Other accrued liabilities | 165,276 | 142,611 |
Current liabilities held for sale | 39,523 | 39,316 |
Total current liabilities | 694,135 | 577,685 |
Long-term debt | 1,725,000 | 725,000 |
Other non-current liabilities | 257,277 | 81,484 |
Long-term liabilities held for sale | 49,189 | 49,414 |
Total liabilities | 2,725,601 | 1,433,583 |
Stockholders' equity: | ||
Common stock | 1,034 | 1,033 |
Additional paid-in capital | 24,182 | 21,026 |
Accumulated other comprehensive loss | (71,004) | (60,346) |
Retained earnings | 1,637,579 | 1,630,148 |
Unearned ESOP shares | (77,738) | (77,738) |
Total stockholders' equity | 1,514,053 | 1,514,123 |
Total liabilities and stockholders' equity | $ 4,239,654 | $ 2,947,706 |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENTS OF INCOME AND OTHER COMPREHENSIVE INCOME (Unaudited) - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | |
Aug. 01, 2015 | Jul. 26, 2014 | |
Income Statement [Abstract] | ||
Net sales | $ 1,142,870 | $ 938,956 |
Cost of sales | 854,626 | 688,339 |
Gross profit | 288,244 | 250,617 |
Operating expenses | 226,067 | 184,621 |
Operating income from continuing operations | 62,177 | 65,996 |
Other income and expense: | ||
Other income, net | 670 | 1,370 |
Interest expense | (12,143) | (8,768) |
Income from continuing operations before taxes | 50,704 | 58,598 |
Income taxes | 30,393 | 20,273 |
Net income from continuing operations | 20,311 | 38,325 |
Net income from discontinued operations | 9,392 | 11,964 |
Net income | $ 29,703 | $ 50,289 |
Basic earnings per share: | ||
Continuing operations | $ 0.20 | $ 0.39 |
Discontinued operations | 0.10 | 0.12 |
Net basic earnings per share | 0.30 | 0.51 |
Diluted earnings per share: | ||
Continuing operations | 0.20 | 0.38 |
Discontinued operations | 0.10 | 0.12 |
Net diluted earnings per share | $ 0.30 | $ 0.50 |
Weighted average shares: | ||
Basic | 99,436 | 99,329 |
Diluted | 100,162 | 100,182 |
Dividends declared per common share | $ 0.22 | $ 0.20 |
Comprehensive income | ||
Net income | $ 29,703 | $ 50,289 |
Foreign currency translation (loss)/gain | (11,275) | 10,310 |
Cash flow hedges, net of tax | 617 | (2,309) |
Comprehensive income | $ 19,045 | $ 58,290 |
CONDENSED CONSOLIDATED STATEME4
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | |
Aug. 01, 2015 | Jul. 26, 2014 | |
Operating activities: | ||
Net income | $ 29,703 | $ 50,289 |
Net income from discontinued operations | 9,392 | 11,964 |
Net income from continuing operations | 20,311 | 38,325 |
Adjustments to reconcile net income from continuing operations to net cash provided by operating activities: | ||
Depreciation | 7,346 | 5,907 |
Amortization | 7,901 | 3,749 |
Bad debt expense | 4,719 | 353 |
Non-cash employee compensation | 6,965 | 6,412 |
Excess tax benefits from stock-based compensation | (63) | (512) |
Change in assets and liabilities, net of acquired | (39,485) | 14,060 |
Net cash provided by operating activities-continuing operations | 7,694 | 68,294 |
Net cash (used in) provided by operating activities-discontinued operations | (2,270) | 476 |
Net cash provided by operating activities | 5,424 | 68,770 |
Investing activities: | ||
Additions to property and equipment | (17,064) | (16,173) |
Acquisitions and equity investments, net of cash assumed | (1,104,730) | |
Purchase of investments | (359) | |
Net cash used in investing activities-continuing operations | (1,121,794) | (16,532) |
Net cash (used in) provided by investing activities-discontinued operations | (54) | 5,086 |
Net cash used in investing activities | (1,121,848) | (11,446) |
Financing activities: | ||
Dividends paid | (23,128) | (20,062) |
Repurchases of common stock | (42,877) | |
Proceeds from issuance of long-term debt | 1,000,000 | |
Debt issuance costs | (11,600) | |
Other financing activities | (745) | (811) |
Net cash provided by (used in) financing activities | 964,527 | (63,750) |
Effect of exchange rate changes on cash | (8,923) | 2,258 |
Net decrease in cash and cash equivalents | (160,820) | (4,168) |
Cash and cash equivalents at beginning of period | 347,260 | 264,908 |
Cash and cash equivalents at end of period | $ 186,440 | $ 260,740 |
General
General | 3 Months Ended |
Aug. 01, 2015 | |
Accounting Policies [Abstract] | |
General | 1. 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. (“Patterson” or “Company”) as of August 1, 2015, and our results of operations and cash flows for the periods ended August 1, 2015 and July 26, 2014. Such adjustments are of a normal recurring nature. The results of operations for the periods ended August 1, 2015 and July 26, 2014, are not necessarily indicative of the results to be expected for the full year. These financial statements should be read in conjunction with the financial statements included in our 2015 Annual Report on Form 10-K filed on June 24, 2015. The condensed consolidated financial statements of our Company include the assets and liabilities of PDC Funding Company, LLC (“PDC Funding”) and PDC Funding Company II, LLC (“PDC Funding II”), wholly owned subsidiaries and separate legal entities under Minnesota law. PDC Funding and PDC Funding II are fully consolidated special purpose entities of our Company established to sell customer installment sale contracts to outside financial institutions in the normal course of business. The assets of PDC Funding and PDC Funding II would be available first and foremost to satisfy the claims of its creditors. There are no known creditors of PDC Funding or PDC Funding II. Through fiscal year 2015, Patterson was comprised of three reportable segments: dental supply, veterinary supply, and rehabilitation supply. In the first quarter of fiscal 2016, we re-evaluated our reportable segments as a result of entering into a definitive agreement to sell our rehabilitation supply business and completing the acquisition of Animal Health International, Inc. We are now comprised of three different reportable segments: Dental, Animal Health and Corporate. Prior period segment results have been restated to conform to this revised current period presentation. Fiscal Year End We operate with a 52-53 week accounting convention with our fiscal year ending on the last Saturday in April. The first quarter of fiscal years 2016 and 2015 represents the 14 weeks ended August 1, 2015 and the 13 weeks ended July 26, 2014, respectively. Fiscal year 2016 will include 53 weeks and fiscal 2015 included 52 weeks of operations. 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 on earnings from foreign operations that are considered to be indefinitely reinvested outside the U.S. The income tax benefit/(loss) related to cash flow hedges was $(85) and $4,813 for the three months ended August 1, 2015 and July 26, 2014, respectively. Earnings Per Share The following table sets forth the computation of the weighted average shares outstanding used to calculate basic and diluted earnings per share: Three Months Ended August 1, July 26, 2015 2014 Denominator for basic earnings per share – weighted average shares 99,436 99,329 Effect of dilutive securities – stock options, restricted stock and stock purchase plans 726 853 Denominator for diluted earnings per share – weighted average shares 100,162 100,182 Potentially dilutive securities representing 939 and 2 shares for the three months ended August 1, 2015 and July 26, 2014, respectively, were excluded from the calculation of diluted earnings per share because their effect would have been anti-dilutive. Recently Issued Accounting Pronouncements In April 2015, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2015-03, Simplifying the Presentation of Debt Issuance Costs In May 2014, the FASB issued ASU No. 2014-09, Revenue from Contracts with Customers Reclassifications Certain prior year amounts have been reclassified to conform to the current year presentation. |
Acquisitions
Acquisitions | 3 Months Ended |
Aug. 01, 2015 | |
Business Combinations [Abstract] | |
Acquisitions | 2. Acquisitions On June 16, 2015, we completed the previously announced acquisition of Animal Health International, Inc., a leading production animal health distribution company in the U.S. This acquisition more than doubled the size of Patterson’s animal health business. Our animal health business now offers a range of products and services to a broader base of customers in North America and the U.K. Under terms of the merger agreement, we acquired all of Animal Health International’s stock for $1,100,000 in cash, subject to customary working capital adjustments. In connection with the acquisition, we entered into a credit agreement consisting of a $1,000,000 unsecured term loan and a $500,000 unsecured cash flow revolving line of credit, described further in Note 11 to the Condensed Consolidated Financial Statements. The acquisition has been accounted for in accordance with ASC 805, Business Combinations The following table summarizes the total purchase price consideration and the preliminary fair value amounts recognized for the assets acquired and liabilities assumed related to the acquisition, as of the acquisition date: Cash $ 1,100,000 Net working capital adjustment 7,704 Fair value of total purchase price consideration $ 1,107,704 Receivables $ 161,427 Inventory 195,367 Prepaid expenses and other current assets 33,005 Property and equipment 44,178 Identifiable intangibles 434,300 Other long-term assets 40,869 Total assets acquired 909,146 Accounts payable 122,129 Accrued liabilities and other current liabilities 19,395 Deferred tax liability 177,789 Total liabilities assumed 319,313 Identifiable net assets acquired 589,833 Goodwill 517,871 Net assets acquired $ 1,107,704 As a result of recording the stepped up fair market basis for GAAP purposes, but receiving primarily carryover basis for tax purposes in the acquisition, we recorded a deferred tax asset and deferred tax liability of $2,569 and $177,789, respectively. The goodwill of $517,871 resulting from the acquisition reflects the excess of our purchase price over the fair value of the net assets acquired. The goodwill recorded as part of the acquisition primarily reflects the value of the assembled workforce, cost synergies, and the potential to integrate and expand existing product lines. We allocated all of the goodwill to our Animal Health reporting segment. None of the goodwill recognized is deductible for income tax purposes, and as such, no deferred taxes have been recorded related to goodwill. Revenues of $171,922 and operating income of $1,653 attributable to the acquisition are included in our condensed consolidated statement of income for the quarter ended August 1, 2015. Included in operating income is amortization expense related to the identifiable intangible assets acquired in the transaction, transaction-related costs and integration expenses. The following summarizes the intangible assets, excluding goodwill, acquired as of June 16, 2015. Intangible assets are amortized using methods that approximate the pattern of economic benefit provided by the utilization of the assets. Gross Carrying Value Weighted Average Life (years) Unamortized – indefinite lived: Trade names $ 12,300 indefinite Amortized: Customer relationships 291,900 15.0 Trade names 111,400 10.0 Developed technology and other 18,700 12.2 Total amortized intangible assets 422,000 13.6 Total identifiable intangible assets $ 434,300 The following unaudited pro forma financial results for the combined results of Patterson and Animal Health International for the quarters ended August 1, 2015 and July 26, 2014 assume the acquisition occurred on April 27, 2014. The unaudited pro forma financial results may not be indicative of the results that would have occurred had the acquisition been completed as of April 27, 2014, nor are they indicative of future results of operations. Three months ended August 1, July 26, 2015 2014 Net sales $ 1,335,906 $ 1,291,817 Net income from continuing operations 27,717 34,345 Net income from continuing operations includes $11,800 of income tax expense related to the repatriation of foreign earnings, described further in Note 12 to the Condensed Consolidated Financial Statements. |
Discontinued Operations
Discontinued Operations | 3 Months Ended |
Aug. 01, 2015 | |
Discontinued Operations and Disposal Groups [Abstract] | |
Discontinued Operations | 3. Discontinued Operations On July 1, 2015, the Company entered into a definitive agreement to sell all of the outstanding shares of common stock of Patterson Medical Holdings, Inc., our wholly owned subsidiary responsible for the Patterson Medical line of business (“Patterson Medical”), for $715,000 in cash to Madison Dearborn Partners. The definitive agreement included a working capital adjustment provision that impacted the final sale price. On August 28, 2015, the Company completed the sale of Patterson Medical. The Company anticipates recognizing an after-tax gain during the second quarter of fiscal 2016 on this sale. In connection with the above described transaction, the Company also entered into a transition services agreement with our former subsidiary, pursuant to which it will pay the Company to provide, among other things, certain information technology, distribution, facilities, finance, tax and treasury, and human resources services for up to 24 months after closing. As of August 1, 2015, the Company classified the results of operations of Patterson Medical as discontinued operations for all periods presented in the condensed consolidated statements of income. The assets and liabilities of Patterson Medical were reflected as held for sale in the condensed consolidated balance sheets as of August 1, 2015 and April 25, 2015. The classification was based on the Company entering into the definitive agreement to sell Patterson Medical, the entity being available for sale in its present condition and the sale being probable as of August 1, 2015. The operations and cash flows of Patterson Medical will be eliminated from ongoing operations of the Company, which was previously recorded as the rehabilitation supply reportable segment. The following summarizes the assets and liabilities of Patterson Medical: August 1, April 25, 2015 2015 Assets held for sale Receivables, net of allowance for doubtful accounts $ 66,876 $ 57,876 Inventory 52,022 48,265 Prepaid expenses and other current assets 11,408 12,206 Property and equipment, net 22,489 22,672 Goodwill 537,985 537,175 Identifiable intangibles, net 74,484 74,804 Other long-term assets 1,798 1,143 Total assets held for sale $ 767,062 $ 754,141 Liabilities held for sale Accounts payable $ 30,108 $ 26,341 Accrued liabilities and other current liabilities 9,415 12,975 Long-term liabilities 49,189 49,414 Total liabilities held for sale $ 88,712 $ 88,730 The following summarizes the results of operations of our discontinued Patterson Medical operations for the periods presented: Three months ended August 1, July 26, 2015 2014 Net sales $ 130,811 $ 120,573 Cost of sales 82,873 74,965 Gross profit 47,938 45,608 Operating expenses 32,039 26,850 Operating income 15,899 18,758 Other income and expense (90 ) 132 Income before taxes 15,809 18,890 Income taxes 6,417 6,926 Net income from discontinued operations $ 9,392 $ 11,964 Income taxes have been allocated to Patterson Medical based on the accounting requirements for presenting discontinued operations. Depreciation and amortization were ceased during the three months ended August 1, 2015 in accordance with accounting for discontinued operations. |
Goodwill and Other Intangible A
Goodwill and Other Intangible Assets | 3 Months Ended |
Aug. 01, 2015 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill and Other Intangible Assets | 4. Goodwill and Other Intangible Assets Goodwill balances and related activity by business segment are as follows: Balance at April 25, 2015 Acquisition Activity and Divestitures Other Balance at August 1, 2015 Dental $ 139,449 $ — $ (747 ) $ 138,702 Animal Health 160,475 517,871 433 678,779 Total $ 299,924 $ 517,871 $ (314 ) $ 817,481 Balances of other intangible assets, excluding goodwill, are as follows: August 1, April 25, 2015 2015 Unamortized – indefinite lived: Copyrights, trade names and trademarks $ 29,900 $ 17,600 Amortized: Distribution agreement, customer lists and other 643,314 221,359 Less: Accumulated amortization (121,877 ) (113,934 ) Net amortized intangible assets 521,437 107,425 Total identifiable intangible assets, net $ 551,337 $ 125,025 |
Derivative Financial Instrument
Derivative Financial Instruments | 3 Months Ended |
Aug. 01, 2015 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Derivative Financial Instruments | 5. Derivative Financial Instruments Patterson is a party to certain offsetting and identical interest rate cap agreements. These cap agreements are not designated for hedge accounting treatment and were entered into to fulfill certain covenants of a sale agreement between a commercial paper conduit managed by The Bank of Tokyo-Mitsubishi UFJ, Ltd. and PDC Funding. On November 25, 2014, this sale agreement was amended on terms consistent with the expiring agreement. The cap agreements provide a credit enhancement feature for the financing contracts sold by PDC Funding to the commercial paper conduit. The cap agreements are cancelled and new agreements entered into periodically to maintain consistency with the dollar maximum of the sale agreements and the maturity of the underlying financing contracts. As of August 1, 2015, PDC Funding had purchased an interest rate cap from a bank with a notional amount of $500,000 and a maturity date of February 2022. Patterson sold an identical interest rate cap to the same bank. Similar to the above agreements, PDC Funding II and Patterson entered into offsetting and identical interest rate cap agreements with a notional amount of $100,000 in fiscal 2014. In August 2014, these agreements were terminated and replaced with offsetting and identical interest rate cap agreements. The notional amount remained at $100,000 and the new maturity date is October 2022. In addition to the purchased and sold identical interest rate cap agreements described above, in May 2012 we entered into an interest rate swap agreement with a bank to economically hedge the interest rate risk associated with a portion of the finance contracts we had sold through the special purpose entities. These interest rate contracts 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 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 as cash flow hedge, to hedge interest rate fluctuations in anticipation of refinancing the 5.17% senior notes due March 25, 2015 with a loan for $250,000 and a term of ten years. This note was 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 will be recognized as interest expense over the ten-year life of the new notes. The following presents the fair value of interest rate contracts included in the condensed consolidated balance sheets: August 1, April 25, Derivative type Classification 2015 2015 Interest rate contracts Other noncurrent assets $ 1,124 $ 1,255 Interest rate contracts Other noncurrent liabilities 1,124 1,255 The following table presents the effect of interest rate contracts on the condensed consolidated statements of income and other comprehensive income: Three Months Ended Derivative type Location of gain/(loss) recognized on derivative August 1, 2015 July 26, 2014 Interest rate swap Other comprehensive income $ 617 $ (2,309 ) We recorded $702 of interest expense during the three month ended August 1, 2015, and $48 as a reduction to interest expense in the three months ended July 26, 2014 related to the interest rate swap. We recorded no ineffectiveness during the three months ended August 1, 2015 and July 26, 2014. |
Fair Value Measurements
Fair Value Measurements | 3 Months Ended |
Aug. 01, 2015 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | 6. 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: August 1, 2015 Total Level 1 Level 2 Level 3 Assets: Cash equivalents $ 10,701 $ 10,701 $ — $ — Derivative instruments 1,124 — 1,124 — Total assets $ 11,825 $ 10,701 $ 1,124 $ — Liabilities: Derivative instruments $ 1,124 $ — $ 1,124 $ — April 25, 2015 Total Level 1 Level 2 Level 3 Assets: Cash equivalents $ 90,569 $ 90,569 $ — $ — Derivative instruments 1,255 — 1,255 — Total assets $ 91,824 $ 90,569 $ 1,255 $ — Liabilities: Derivative instruments $ 1,255 $ — $ 1,255 $ — Cash equivalents Derivative instruments 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, such as when there is evidence of impairment. There were no fair value adjustments to such assets during the periods ended August 1, 2015 or July 26, 2014. Patterson’s debt is not measured at fair value in the condensed consolidated balance sheets. The estimated fair value of our debt as of August 1, 2015 and April 25, 2015 was $1,735,888 and $746,685, respectively. The fair value of debt was measured using a discounted cash flow analysis based on expected market based yields. These are Level 2 inputs under the fair value measurements and disclosure guidance. The carrying amounts of receivables, net of allowances, accounts payable, and certain accrued and other current liabilities approximated fair value at August 1, 2015 and April 25, 2015. |
Securities
Securities | 3 Months Ended |
Aug. 01, 2015 | |
Investments, Debt and Equity Securities [Abstract] | |
Securities | 7. Securities On October 25, 2013, we invested in three time deposits with total principal of $110,000 Canadian. On October 24, 2014, time deposits with a principal value of $45,000 Canadian matured with a value of $45,436 Canadian. The remaining time deposits with a principal value of $65,000 Canadian were classified as short-term investments at August 1, 2015 with a U.S. dollar equivalent value of $49,651. Our time deposit securities are classified as held-to-maturity securities as we have both the intent and ability to hold until maturity. They are carried at cost, adjusted for accrued interest and amortization. The carrying value is not materially different than fair value. The fair value was determined based on a discounted cash flow analysis using unobservable inputs (i.e. level 3 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 lower fair value estimate. The interrelationship between these inputs is insignificant. |
Customer Financing
Customer Financing | 3 Months Ended |
Aug. 01, 2015 | |
Text Block [Abstract] | |
Customer Financing | 8. Customer Financing As a convenience to our customers, we offer several different financing alternatives, including a third party program and a Company-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 our sponsored program, equipment purchased by customers with strong credit may be financed up to a maximum of $500 for any one customer. We generally sell our customers’ financing contracts to outside financial institutions in the normal course of our business. Patterson currently has two arrangements under which we sell these contracts. First, Patterson operates under an agreement to sell a portion of our equipment finance contracts to commercial paper conduits with The Bank of Tokyo-Mitsubishi UFJ, Ltd. serving as the agent. We utilize a special purpose entity (“SPE”), PDC Funding, a consolidated, wholly owned subsidiary, to fulfill a requirement of participating in the commercial paper conduit. We receive the proceeds of the contracts upon sale. At least 13% of the proceeds are held by the conduit as security against eventual performance of the portfolio. The capacity under the agreement at August 1, 2015 was $500,000. Second, Patterson also maintains an agreement with Fifth Third Bank whereby the bank purchases customers’ financing contracts. Patterson established another SPE, PDC Funding II, a consolidated, wholly owned subsidiary, which sells financing contracts to the bank. We receive the proceeds of the contracts upon sale. At least 23% of the proceeds are held by the conduit as security against eventual performance of the portfolio. The capacity under the agreement at August 1, 2015 was $100,000. The portion of the purchase price for the receivables held by the conduits is a deferred purchase price receivable, which is paid to the SPE as payments on the receivables are collected from customers. The deferred purchase price receivable represents a beneficial interest in the transferred financial assets and is recognized at fair value as part of the sale transaction. The Company values the deferred purchase price receivable based on a discounted cash flow analysis using unobservable inputs (i.e. level 3 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. These financing arrangements are accounted for as a sale of assets under the provisions of ASC Topic No. 860, Transfers and Servicing Included in cash and cash equivalents in the condensed consolidated balance sheets are $26,202 and $29,863 as of August 1, 2015 and April 25, 2015, respectively, which represents cash collected from previously sold customer financing arrangements that have not yet been settled with the third party. Included in current receivables in the condensed consolidated balance sheets are $66,886, net of unearned income of $4,506, and $88,470, net of unearned income of $4,197, as of August 1, 2015 and April 25, 2015, respectively, of finance contracts not yet sold by Patterson. A total of $554,072 of finance contracts receivable sold under the agreements was outstanding at August 1, 2015. The deferred purchase price under the arrangements was $79,392 and $66,715 as of August 1, 2015 and April 25, 2015, respectively. Since the internal financing program began in 1994, bad debt write-offs have amounted to less than one-percent of the loans originated. |
Segment Reporting
Segment Reporting | 3 Months Ended |
Aug. 01, 2015 | |
Segment Reporting [Abstract] | |
Segment Reporting | 9. Segment Reporting Through fiscal year 2015, Patterson was comprised of three reportable segments: dental supply, veterinary supply, and rehabilitation supply. In the first quarter of fiscal 2016, we re-evaluated our reportable segments as a result of entering into a definitive agreement to sell Patterson Medical and completing the acquisition of Animal Health International, Inc. We are now comprised of three different reportable segments: Dental, Animal Health and Corporate. Prior period segment results have been restated to conform to this revised current period presentation. Our Dental and Animal Health reportable business segments 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 and dental laboratories throughout North America. Animal Health, formerly our Patterson Veterinary reportable segment, 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, which was previously included in our dental supply reporting segment through the end of fiscal 2015, 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 distribution centers are allocated to the operating units based on the through-put of the unit. The following table presents information about Patterson’s reportable segments: Three Months Ended August 1, July 26, 2014 Net sales Corporate $ 10,456 $ 9,782 Dental 575,117 542,874 Animal Health 557,297 386,300 Consolidated net sales $ 1,142,870 $ 938,956 Operating income (loss) from continuing operations Corporate $ (18,047 ) $ (10,540 ) Dental 67,252 62,549 Animal Health 12,972 13,987 Consolidated operating income from continuing operations $ 62,177 $ 65,996 August 1, April 25, Total assets Corporate $ 494,647 $ 539,863 Dental 920,035 1,022,257 Animal Health 2,057,910 631,445 Total assets, excluding assets held for sale 3,472,592 2,193,565 Assets held for sale 767,062 754,141 Total assets $ 4,239,654 $ 2,947,706 The following table presents sales information by product for all of Patterson’s reportable segments: Three Months Ended August 1, July 26, Net sales Consumables $ 895,307 $ 695,639 Equipment and software 153,483 156,394 Other 94,080 86,923 Consolidated net sales $ 1,142,870 $ 938,956 |
Accumulated Other Comprehensive
Accumulated Other Comprehensive Loss | 3 Months Ended |
Aug. 01, 2015 | |
Equity [Abstract] | |
Accumulated Other Comprehensive Loss | 10. Accumulated Other Comprehensive Loss The following table summarizes accumulated other comprehensive loss (AOCL) at August 1, 2015 and April 25, 2015 and the activity for fiscal 2016: Cash Flow Currency Total AOCL at April 25, 2015 $ (18,668 ) $ (41,678 ) $ (60,346 ) Other comprehensive loss before reclassifications — (11,275 ) (11,275 ) Amounts reclassified from AOCL 617 — 617 AOCL at August 1, 2015 $ (18,051 ) $ (52,953 ) $ (71,004 ) The amounts reclassified from AOCL during fiscal 2016 represent gains and losses on cash flow hedges, net of taxes of $85. The net impact to the condensed consolidated statements of income was an increase to interest expense of $702. |
Debt Issuance
Debt Issuance | 3 Months Ended |
Aug. 01, 2015 | |
Debt Disclosure [Abstract] | |
Debt Issuance | 11. Debt Issuance On June 16, 2015, the Company entered into a credit agreement with The Bank of Tokyo-Mitsubishi UFJ, Ltd., as administrative agent, and Bank of America, N.A., as syndication agent, (the “Credit Agreement”). Pursuant to the Credit Agreement, the lenders provided Patterson with senior unsecured lending facilities of up to $1,500,000, consisting of a $1,000,000 unsecured term loan and a $500,000 unsecured revolving line of credit. Interest on borrowings under the Credit Agreement is based on LIBOR plus a spread which can range from 1.125% to 2.000%. This spread, as well as a commitment fee on the unused portion of the facility, are based on our leverage ratio, as defined in the Credit Agreement. The initial interest rate under the Credit Agreement is LIBOR plus 2.000%. Initial borrowings under the Credit Agreement were $1,000,000 under the unsecured term loan and $200,000 under the unsecured revolving line of credit. The term loan and revolving credit facilities will mature no later than June 16, 2020. Upon certain significant asset dispositions, we agreed to use proceeds from such dispositions to effect prepayment of outstanding loan balances under the Credit Agreement. Subsequent to the end of our first quarter of fiscal 2016, on August 28, 2015, we completed the sale of Patterson Medical, as described further in Note 3 to the Condensed Consolidated Financial Statements. As a result of this sale, $670,000 was repaid on the original outstanding $1,000,000 unsecured term loan. The Company is subject to various financial covenants under the Credit Agreement including the maintenance of leverage and interest coverage ratios. In the event of a default by the Company, any outstanding obligations may become due and payable immediately. We met the covenants under the Credit Agreement as of August 1, 2015. On June 16, 2015, our previous $300,000 credit facility, which was due to expire in December 2016, was terminated and replaced by the revolving line of credit under the Credit Agreement. There were no outstanding borrowings under our current or previous revolving lines of credit at August 1, 2015 or April 25, 2015. |
Income Taxes
Income Taxes | 3 Months Ended |
Aug. 01, 2015 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | 12. Income Taxes The effective income tax rate for the three months ended August 1, 2015 was 59.9% compared to 34.6% in the three months ended July 26, 2014. The increase in the rate is primarily due to the current quarter impact of cash repatriation and the impact of transaction-related costs incurred related to the acquisition of Animal Health International. In the first quarter of fiscal year 2016, we approved a one-time repatriation of approximately $200,000 of foreign earnings. This one-time repatriation reduced the overall cost of funding the acquisition of Animal Health International, Inc. In addition, certain foreign cash at Patterson Medical was required to be repatriated as part of the sale transaction. The full tax impact of the repatriation has been recorded in the first quarter of fiscal 2016, with $11,800 allocated to continuing operations. The Company has previously asserted that its foreign earnings are permanently reinvested and, outside of this one-time repatriation, does not change its on-going assertion. |
Subsequent Events
Subsequent Events | 3 Months Ended |
Aug. 01, 2015 | |
Subsequent Events [Abstract] | |
Subsequent Events | 13. Subsequent Events Subsequent to the end of our first quarter of fiscal 2016, on August 28, 2015, we completed the sale of Patterson Medical, described further in Note 3 to the Condensed Consolidated Financial Statements. The Company anticipates recognizing an after-tax gain during the second quarter of fiscal 2016 on this sale. As a result of this sale, $670,000 was repaid on the original outstanding $1,000,000 unsecured term loan under the Credit Agreement described further in Note 11 to the Condensed Consolidated Financial Statements. |
General (Policies)
General (Policies) | 3 Months Ended |
Aug. 01, 2015 | |
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. (“Patterson” or “Company”) as of August 1, 2015, and our results of operations and cash flows for the periods ended August 1, 2015 and July 26, 2014. Such adjustments are of a normal recurring nature. The results of operations for the periods ended August 1, 2015 and July 26, 2014, are not necessarily indicative of the results to be expected for the full year. These financial statements should be read in conjunction with the financial statements included in our 2015 Annual Report on Form 10-K filed on June 24, 2015. The condensed consolidated financial statements of our Company include the assets and liabilities of PDC Funding Company, LLC (“PDC Funding”) and PDC Funding Company II, LLC (“PDC Funding II”), wholly owned subsidiaries and separate legal entities under Minnesota law. PDC Funding and PDC Funding II are fully consolidated special purpose entities of our Company established to sell customer installment sale contracts to outside financial institutions in the normal course of business. The assets of PDC Funding and PDC Funding II would be available first and foremost to satisfy the claims of its creditors. There are no known creditors of PDC Funding or PDC Funding II. Through fiscal year 2015, Patterson was comprised of three reportable segments: dental supply, veterinary supply, and rehabilitation supply. In the first quarter of fiscal 2016, we re-evaluated our reportable segments as a result of entering into a definitive agreement to sell our rehabilitation supply business and completing the acquisition of Animal Health International, Inc. We are now comprised of three different reportable segments: Dental, Animal Health and Corporate. Prior period segment results have been restated to conform to this revised current period presentation. |
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 first quarter of fiscal years 2016 and 2015 represents the 14 weeks ended August 1, 2015 and the 13 weeks ended July 26, 2014, respectively. Fiscal year 2016 will include 53 weeks and fiscal 2015 included 52 weeks of operations. |
Comprehensive Income | 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 on earnings from foreign operations that are considered to be indefinitely reinvested outside the U.S. The income tax benefit/(loss) related to cash flow hedges was $(85) and $4,813 for the three months ended August 1, 2015 and July 26, 2014, respectively. |
Earnings Per Share | Earnings Per Share The following table sets forth the computation of the weighted average shares outstanding used to calculate basic and diluted earnings per share: Three Months Ended August 1, July 26, 2015 2014 Denominator for basic earnings per share – weighted average shares 99,436 99,329 Effect of dilutive securities – stock options, restricted stock and stock purchase plans 726 853 Denominator for diluted earnings per share – weighted average shares 100,162 100,182 Potentially dilutive securities representing 939 and 2 shares for the three months ended August 1, 2015 and July 26, 2014, respectively, were excluded from the calculation of diluted earnings per share because their effect would have been anti-dilutive. |
Recently Issued Accounting Pronouncements | Recently Issued Accounting Pronouncements In April 2015, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2015-03, Simplifying the Presentation of Debt Issuance Costs In May 2014, the FASB issued ASU No. 2014-09, Revenue from Contracts with Customers |
Reclassifications | Reclassifications Certain prior year amounts have been reclassified to conform to the current year presentation. |
General (Tables)
General (Tables) | 3 Months Ended |
Aug. 01, 2015 | |
Accounting Policies [Abstract] | |
Computation of Basic and Diluted Earnings Per Share | The following table sets forth the computation of the weighted average shares outstanding used to calculate basic and diluted earnings per share: Three Months Ended August 1, July 26, 2015 2014 Denominator for basic earnings per share – weighted average shares 99,436 99,329 Effect of dilutive securities – stock options, restricted stock and stock purchase plans 726 853 Denominator for diluted earnings per share – weighted average shares 100,162 100,182 |
Acquisitions (Tables)
Acquisitions (Tables) | 3 Months Ended |
Aug. 01, 2015 | |
Business Combinations [Abstract] | |
Summary of Total Purchase Price Consideration and Preliminary Fair Value of Assets Acquired and Liabilities Assumed | The following table summarizes the total purchase price consideration and the preliminary fair value amounts recognized for the assets acquired and liabilities assumed related to the acquisition, as of the acquisition date: Cash $ 1,100,000 Net working capital adjustment 7,704 Fair value of total purchase price consideration $ 1,107,704 Receivables $ 161,427 Inventory 195,367 Prepaid expenses and other current assets 33,005 Property and equipment 44,178 Identifiable intangibles 434,300 Other long-term assets 40,869 Total assets acquired 909,146 Accounts payable 122,129 Accrued liabilities and other current liabilities 19,395 Deferred tax liability 177,789 Total liabilities assumed 319,313 Identifiable net assets acquired 589,833 Goodwill 517,871 Net assets acquired $ 1,107,704 |
Summary of Acquired Intangible Assets Excluding Goodwill | The following summarizes the intangible assets, excluding goodwill, acquired as of June 16, 2015. Intangible assets are amortized using methods that approximate the pattern of economic benefit provided by the utilization of the assets. Gross Carrying Value Weighted Average Life (years) Unamortized – indefinite lived: Trade names $ 12,300 indefinite Amortized: Customer relationships 291,900 15.0 Trade names 111,400 10.0 Developed technology and other 18,700 12.2 Total amortized intangible assets 422,000 13.6 Total identifiable intangible assets $ 434,300 |
Summary of Unaudited Pro Forma Financial Result | The unaudited pro forma financial results may not be indicative of the results that would have occurred had the acquisition been completed as of April 27, 2014, nor are they indicative of future results of operations. Three months ended August 1, July 26, 2015 2014 Net sales $ 1,335,906 $ 1,291,817 Net income from continuing operations 27,717 34,345 |
Discontinued Operations (Tables
Discontinued Operations (Tables) | 3 Months Ended |
Aug. 01, 2015 | |
Discontinued Operations and Disposal Groups [Abstract] | |
Summary of Assets and Liabilities Held For Sale and Results of Operations Under Discontinued Operation Activities | The following summarizes the assets and liabilities of Patterson Medical: August 1, April 25, 2015 2015 Assets held for sale Receivables, net of allowance for doubtful accounts $ 66,876 $ 57,876 Inventory 52,022 48,265 Prepaid expenses and other current assets 11,408 12,206 Property and equipment, net 22,489 22,672 Goodwill 537,985 537,175 Identifiable intangibles, net 74,484 74,804 Other long-term assets 1,798 1,143 Total assets held for sale $ 767,062 $ 754,141 Liabilities held for sale Accounts payable $ 30,108 $ 26,341 Accrued liabilities and other current liabilities 9,415 12,975 Long-term liabilities 49,189 49,414 Total liabilities held for sale $ 88,712 $ 88,730 The following summarizes the results of operations of our discontinued Patterson Medical operations for the periods presented: Three months ended August 1, July 26, 2015 2014 Net sales $ 130,811 $ 120,573 Cost of sales 82,873 74,965 Gross profit 47,938 45,608 Operating expenses 32,039 26,850 Operating income 15,899 18,758 Other income and expense (90 ) 132 Income before taxes 15,809 18,890 Income taxes 6,417 6,926 Net income from discontinued operations $ 9,392 $ 11,964 |
Goodwill and Other Intangible22
Goodwill and Other Intangible Assets (Tables) | 3 Months Ended |
Aug. 01, 2015 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill Balances and Related Activity by Business Segment | Goodwill balances and related activity by business segment are as follows: Balance at April 25, 2015 Acquisition Activity and Divestitures Other Balance at August 1, 2015 Dental $ 139,449 $ — $ (747 ) $ 138,702 Animal Health 160,475 517,871 433 678,779 Total $ 299,924 $ 517,871 $ (314 ) $ 817,481 |
Balances of Other Intangible Assets Excluding Goodwill | Balances of other intangible assets, excluding goodwill, are as follows: August 1, April 25, 2015 2015 Unamortized – indefinite lived: Copyrights, trade names and trademarks $ 29,900 $ 17,600 Amortized: Distribution agreement, customer lists and other 643,314 221,359 Less: Accumulated amortization (121,877 ) (113,934 ) Net amortized intangible assets 521,437 107,425 Total identifiable intangible assets, net $ 551,337 $ 125,025 |
Derivative Financial Instrume23
Derivative Financial Instruments (Tables) | 3 Months Ended |
Aug. 01, 2015 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Fair Value of Interest Rate Contracts Included in Condensed Consolidated Balance Sheets | The following presents the fair value of interest rate contracts included in the condensed consolidated balance sheets: August 1, April 25, Derivative type Classification 2015 2015 Interest rate contracts Other noncurrent assets $ 1,124 $ 1,255 Interest rate contracts Other noncurrent liabilities 1,124 1,255 |
Effect of Interest Rate Contracts on Condensed Consolidated Statements of Income and Other Comprehensive Income | The following table presents the effect of interest rate contracts on the condensed consolidated statements of income and other comprehensive income: Three Months Ended Derivative type Location of gain/(loss) recognized on derivative August 1, 2015 July 26, 2014 Interest rate swap Other comprehensive income $ 617 $ (2,309 ) |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 3 Months Ended |
Aug. 01, 2015 | |
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: August 1, 2015 Total Level 1 Level 2 Level 3 Assets: Cash equivalents $ 10,701 $ 10,701 $ — $ — Derivative instruments 1,124 — 1,124 — Total assets $ 11,825 $ 10,701 $ 1,124 $ — Liabilities: Derivative instruments $ 1,124 $ — $ 1,124 $ — April 25, 2015 Total Level 1 Level 2 Level 3 Assets: Cash equivalents $ 90,569 $ 90,569 $ — $ — Derivative instruments 1,255 — 1,255 — Total assets $ 91,824 $ 90,569 $ 1,255 $ — Liabilities: Derivative instruments $ 1,255 $ — $ 1,255 $ — |
Segment Reporting (Tables)
Segment Reporting (Tables) | 3 Months Ended |
Aug. 01, 2015 | |
Segment Reporting [Abstract] | |
Information about Reportable Segments | The following table presents information about Patterson’s reportable segments: Three Months Ended August 1, July 26, 2014 Net sales Corporate $ 10,456 $ 9,782 Dental 575,117 542,874 Animal Health 557,297 386,300 Consolidated net sales $ 1,142,870 $ 938,956 Operating income (loss) from continuing operations Corporate $ (18,047 ) $ (10,540 ) Dental 67,252 62,549 Animal Health 12,972 13,987 Consolidated operating income from continuing operations $ 62,177 $ 65,996 August 1, April 25, Total assets Corporate $ 494,647 $ 539,863 Dental 920,035 1,022,257 Animal Health 2,057,910 631,445 Total assets, excluding assets held for sale 3,472,592 2,193,565 Assets held for sale 767,062 754,141 Total assets $ 4,239,654 $ 2,947,706 |
Sales Information by Product | The following table presents sales information by product for all of Patterson’s reportable segments: Three Months Ended August 1, July 26, Net sales Consumables $ 895,307 $ 695,639 Equipment and software 153,483 156,394 Other 94,080 86,923 Consolidated net sales $ 1,142,870 $ 938,956 |
Accumulated Other Comprehensi26
Accumulated Other Comprehensive Loss (Tables) | 3 Months Ended |
Aug. 01, 2015 | |
Equity [Abstract] | |
Summary of Accumulated Other Comprehensive Loss | The following table summarizes accumulated other comprehensive loss (AOCL) at August 1, 2015 and April 25, 2015 and the activity for fiscal 2016: Cash Flow Currency Total AOCL at April 25, 2015 $ (18,668 ) $ (41,678 ) $ (60,346 ) Other comprehensive loss before reclassifications — (11,275 ) (11,275 ) Amounts reclassified from AOCL 617 — 617 AOCL at August 1, 2015 $ (18,051 ) $ (52,953 ) $ (71,004 ) |
General - Additional Informatio
General - Additional Information (Detail) $ in Thousands | 3 Months Ended | 12 Months Ended | |
Aug. 01, 2015USD ($)Segmentshares | Jul. 26, 2014USD ($)shares | Apr. 25, 2015Segment | |
Accounting Policies [Abstract] | |||
Number of reportable segments | 3 | 3 | |
Income tax benefit/(loss) related to cash flow hedges | $ | $ (85) | $ 4,813 | |
Securities excluded from calculation of diluted earnings per share | shares | 939 | 2 |
General - Computation of Basic
General - Computation of Basic and Diluted Earnings Per Share (Detail) - shares shares in Thousands | 3 Months Ended | |
Aug. 01, 2015 | Jul. 26, 2014 | |
Earnings Per Share [Abstract] | ||
Denominator for basic earnings per share - weighted average shares | 99,436 | 99,329 |
Effect of dilutive securities - stock options, restricted stock and stock purchase plans | 726 | 853 |
Denominator for diluted earnings per share - weighted average shares | 100,162 | 100,182 |
Acquisitions - Additional Infor
Acquisitions - Additional Information (Detail) - USD ($) | Jun. 16, 2015 | Aug. 01, 2015 | Jul. 26, 2014 | Apr. 25, 2015 |
Business Acquisition [Line Items] | ||||
Goodwill | $ 817,481,000 | $ 299,924,000 | ||
Revenues | 1,142,870,000 | $ 938,956,000 | ||
Operating income | 62,177,000 | $ 65,996,000 | ||
Tax impact of repatriation of foreign earnings | 11,800,000 | |||
Animal Health International [Member] | ||||
Business Acquisition [Line Items] | ||||
Business acquisition cash paid | $ 1,100,000,000 | |||
Identifiable net assets acquired | $ 589,833,000 | |||
Revision period after valuation completion for provisional amounts | 1 year | |||
Deferred tax asset | $ 2,569,000 | |||
Deferred tax liability | 177,789,000 | |||
Goodwill | 517,871,000 | |||
Goodwill recognized, deductible for income tax purpose | 0 | |||
Deferred taxes recorded related to goodwill | 0 | |||
Revenues | 171,922,000 | |||
Operating income | $ 1,653,000 | |||
Animal Health International [Member] | Term Loan [Member] | ||||
Business Acquisition [Line Items] | ||||
Unsecured term loan | 1,000,000,000 | |||
Animal Health International [Member] | Revolving Credit Facility [Member] | ||||
Business Acquisition [Line Items] | ||||
Unsecured revolving line of credit | $ 500,000,000 |
Acquisitions - Summary of Total
Acquisitions - Summary of Total Purchase Price Consideration and Preliminary Fair Value of Assets Acquired and Liabilities Assumed (Detail) - USD ($) $ in Thousands | Jun. 16, 2015 | Aug. 01, 2015 | Apr. 25, 2015 |
Business Acquisition [Line Items] | |||
Goodwill | $ 817,481 | $ 299,924 | |
Animal Health International [Member] | |||
Business Acquisition [Line Items] | |||
Cash | $ 1,100,000 | ||
Net working capital adjustment | 7,704 | ||
Fair value of total purchase price consideration | 1,107,704 | ||
Receivables | 161,427 | ||
Inventory | 195,367 | ||
Prepaid expenses and other current assets | 33,005 | ||
Property and equipment | 44,178 | ||
Identifiable intangibles | 434,300 | ||
Other long-term assets | 40,869 | ||
Total assets acquired | 909,146 | ||
Accounts payable | 122,129 | ||
Accrued liabilities and other current liabilities | 19,395 | ||
Deferred tax liability | 177,789 | ||
Total liabilities assumed | 319,313 | ||
Identifiable net assets acquired | 589,833 | ||
Goodwill | 517,871 | ||
Net assets acquired | $ 1,107,704 |
Acquisitions - Summary of Acqui
Acquisitions - Summary of Acquired Intangible Assets Excluding Goodwill (Detail) - Jun. 16, 2015 - Animal Health International [Member] - USD ($) $ in Thousands | Total |
Business Acquisition [Line Items] | |
Total amortized intangible assets | $ 422,000 |
Total identifiable intangible assets | $ 434,300 |
Finite lived intangible assets, Weighted average life (years) | 13 years 7 months 6 days |
Trade Names [Member] | |
Business Acquisition [Line Items] | |
Unamortized - indefinite lived | $ 12,300 |
Indefinite lived intangible assets, Weighted average life (years) | indefinite |
Customer Relationships [Member] | |
Business Acquisition [Line Items] | |
Total amortized intangible assets | $ 291,900 |
Finite lived intangible assets, Weighted average life (years) | 15 years |
Trade Names [Member] | |
Business Acquisition [Line Items] | |
Total amortized intangible assets | $ 111,400 |
Finite lived intangible assets, Weighted average life (years) | 10 years |
Developed Technology and Other [Member] | |
Business Acquisition [Line Items] | |
Total amortized intangible assets | $ 18,700 |
Finite lived intangible assets, Weighted average life (years) | 12 years 2 months 12 days |
Acquisitions - Summary of Unaud
Acquisitions - Summary of Unaudited Pro Forma Financial Result (Detail) - USD ($) $ in Thousands | 3 Months Ended | |
Aug. 01, 2015 | Jul. 26, 2014 | |
Business Acquisition, Pro Forma Information [Abstract] | ||
Net sales | $ 1,335,906 | $ 1,291,817 |
Net income from continuing operations | $ 27,717 | $ 34,345 |
Discontinued Operations - Addit
Discontinued Operations - Additional Information (Detail) - USD ($) $ in Thousands | 3 Months Ended | |
Aug. 01, 2015 | Jul. 01, 2015 | |
Discontinued Operations and Disposal Groups [Abstract] | ||
Consideration receivable as per definitive agreement | $ 715,000 | |
Transition services agreement, period of involvement | 24 months |
Discontinued Operations - Summa
Discontinued Operations - Summary of Assets and Liabilities Held For Sale (Detail) - USD ($) $ in Thousands | Aug. 01, 2015 | Apr. 25, 2015 |
Assets held for sale | ||
Receivables, net of allowance for doubtful accounts | $ 66,876 | $ 57,876 |
Inventory | 52,022 | 48,265 |
Prepaid expenses and other current assets | 11,408 | 12,206 |
Property and equipment, net | 22,489 | 22,672 |
Goodwill | 537,985 | 537,175 |
Identifiable intangibles, net | 74,484 | 74,804 |
Other long-term assets | 1,798 | 1,143 |
Total assets held for sale | 767,062 | 754,141 |
Liabilities held for sale | ||
Accounts payable | 30,108 | 26,341 |
Accrued liabilities and other current liabilities | 9,415 | 12,975 |
Long-term liabilities | 49,189 | 49,414 |
Total liabilities held for sale | $ 88,712 | $ 88,730 |
Discontinued Operations - Sum35
Discontinued Operations - Summary of Results of Operations Under Discontinued Operation Activities (Detail) - USD ($) $ in Thousands | 3 Months Ended | |
Aug. 01, 2015 | Jul. 26, 2014 | |
Discontinued Operations and Disposal Groups [Abstract] | ||
Net sales | $ 130,811 | $ 120,573 |
Cost of sales | 82,873 | 74,965 |
Gross profit | 47,938 | 45,608 |
Operating expenses | 32,039 | 26,850 |
Operating income | 15,899 | 18,758 |
Other income and expense | (90) | 132 |
Income before taxes | 15,809 | 18,890 |
Income taxes | 6,417 | 6,926 |
Net income from discontinued operations | $ 9,392 | $ 11,964 |
Goodwill and Other Intangible36
Goodwill and Other Intangible Assets - Goodwill Balances and Related Activity by Business Segment (Detail) $ in Thousands | 3 Months Ended |
Aug. 01, 2015USD ($) | |
Goodwill [Line Items] | |
Beginning Balance | $ 299,924 |
Acquisition Activity and Divestitures | 517,871 |
Other Activity | (314) |
Ending Balance | 817,481 |
Dental [Member] | |
Goodwill [Line Items] | |
Beginning Balance | 139,449 |
Other Activity | (747) |
Ending Balance | 138,702 |
Animal Health [Member] | |
Goodwill [Line Items] | |
Beginning Balance | 160,475 |
Acquisition Activity and Divestitures | 517,871 |
Other Activity | 433 |
Ending Balance | $ 678,779 |
Goodwill and Other Intangible37
Goodwill and Other Intangible Assets - Balances of Other Intangible Assets Excluding Goodwill (Detail) - USD ($) $ in Thousands | Aug. 01, 2015 | Apr. 25, 2015 |
Goodwill and Intangible Assets Disclosure [Abstract] | ||
Copyrights, trade names and trademarks | $ 29,900 | $ 17,600 |
Distribution agreement, customer lists and other | 643,314 | 221,359 |
Less: Accumulated amortization | (121,877) | (113,934) |
Net amortized intangible assets | 521,437 | 107,425 |
Total identifiable intangible assets, net | $ 551,337 | $ 125,025 |
Derivative Financial Instrume38
Derivative Financial Instruments - Additional Information (Detail) | 1 Months Ended | 3 Months Ended | |||
Aug. 31, 2014USD ($) | Jan. 31, 2014USD ($) | Aug. 01, 2015USD ($)Derivative | Jul. 26, 2014USD ($) | Apr. 26, 2014USD ($) | |
Derivative [Line Items] | |||||
Interest expense | $ 12,143,000 | $ 8,768,000 | |||
Long-term Debt [Member] | |||||
Derivative [Line Items] | |||||
Period of long-term loan | 10 years | ||||
Long-term loan | $ 250,000,000 | ||||
Interest Rate Cap [Member] | |||||
Derivative [Line Items] | |||||
Notional amount of derivatives | $ 500,000,000 | $ 100,000,000 | |||
Maturity date | 2022-02 | ||||
Number of interest rate caps purchased by PDC Funding | Derivative | 1 | ||||
Number of interest rate caps sold | Derivative | 1 | ||||
Interest Rate Cap [Member] | Replacement Agreement [Member] | |||||
Derivative [Line Items] | |||||
Notional amount of derivatives | $ 100,000,000 | ||||
Maturity date | 2022-10 | ||||
Interest Rate Swap [Member] | |||||
Derivative [Line Items] | |||||
Interest expense | $ 702,000 | $ (48,000) | |||
Interest Rate Swap Agreement [Member] | |||||
Derivative [Line Items] | |||||
Notional amount of derivatives | $ 250,000,000 | ||||
Percentage of senior notes | 5.17% | ||||
Senior notes amount due | $ 250,000,000 | ||||
Settlement of swap | $ 29,003,000 | ||||
Interest Rate Swap Agreement [Member] | Senior Notes 3.48% [Member] | |||||
Derivative [Line Items] | |||||
Percentage of senior notes | 3.48% | ||||
Period of long-term loan | 10 years | ||||
Maturity date of long-term loan | Mar. 24, 2025 | ||||
Aggregate principal amount | $ 250,000,000 | ||||
Interest Rate Swap Agreement [Member] | 5.17% Senior Notes [Member] | |||||
Derivative [Line Items] | |||||
Maturity date of long-term loan | Mar. 25, 2015 |
Derivative Financial Instrume39
Derivative Financial Instruments - Fair Value of Interest Rate Contracts Included in Condensed Consolidated Balance Sheets (Detail) - USD ($) $ in Thousands | Aug. 01, 2015 | Apr. 25, 2015 |
Derivatives, Fair Value [Line Items] | ||
Interest rate contracts, assets, fair value | $ 1,124 | $ 1,255 |
Interest rate, liabilities, fair value | 1,124 | 1,255 |
Other Noncurrent Assets [Member] | Interest Rate Contracts [Member] | ||
Derivatives, Fair Value [Line Items] | ||
Interest rate contracts, assets, fair value | 1,124 | 1,255 |
Other Noncurrent Liabilities [Member] | Interest Rate Contracts [Member] | ||
Derivatives, Fair Value [Line Items] | ||
Interest rate, liabilities, fair value | $ 1,124 | $ 1,255 |
Derivative Financial Instrume40
Derivative Financial Instruments - Effect of Interest Rate Contracts on Condensed Consolidated Statements of Income and Other Comprehensive Income (Detail) - USD ($) $ in Thousands | 3 Months Ended | |
Aug. 01, 2015 | Jul. 26, 2014 | |
Interest Rate Swap [Member] | Other Comprehensive Income [Member] | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Effect of interest rate contracts | $ 617 | $ (2,309) |
Fair Value Measurements - Asset
Fair Value Measurements - Assets and Liabilities Measured at Fair Value on Recurring Basis (Detail) - USD ($) $ in Thousands | Aug. 01, 2015 | Apr. 25, 2015 |
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Cash equivalents | $ 10,701 | $ 90,569 |
Derivative instruments, assets | 1,124 | 1,255 |
Total assets | 11,825 | 91,824 |
Derivative instruments, liabilities | 1,124 | 1,255 |
Fair Value, Inputs, Level 1 [Member] | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Cash equivalents | 10,701 | 90,569 |
Total assets | 10,701 | 90,569 |
Fair Value, Inputs, Level 2 [Member] | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Derivative instruments, assets | 1,124 | 1,255 |
Total assets | 1,124 | 1,255 |
Derivative instruments, liabilities | $ 1,124 | $ 1,255 |
Fair Value Measurements - Addit
Fair Value Measurements - Additional Information (Detail) - USD ($) $ in Thousands | Aug. 01, 2015 | Apr. 25, 2015 |
Fair Value Disclosures [Abstract] | ||
Estimated fair value of debt | $ 1,735,888 | $ 746,685 |
Securities - Additional Informa
Securities - Additional Information (Detail) CAD in Thousands, $ in Thousands | Aug. 01, 2015USD ($) | Aug. 01, 2015CAD | Apr. 25, 2015USD ($) | Oct. 24, 2014CAD | Oct. 25, 2013CAD |
Investments, Debt and Equity Securities [Abstract] | |||||
Total principal amount | CAD 65,000 | CAD 45,000 | CAD 110,000 | ||
Maturity value of time deposits | CAD 45,436 | ||||
Short-term investments | $ | $ 49,651 | $ 53,372 |
Customer Financing - Additional
Customer Financing - Additional Information (Detail) | 3 Months Ended | |||
Aug. 01, 2015USD ($)Customer | Jul. 26, 2014USD ($) | Apr. 25, 2015USD ($) | Apr. 26, 2014USD ($) | |
Customer Financing [Line Items] | ||||
Maximum credit financed for equipment purchases for any one customer | $ 500,000 | |||
Number of customer financing contracts | Customer | 2 | |||
Financing contracts sold under ASC 860 | $ 94,767,000 | $ 85,100,000 | ||
Cash and cash equivalents | 186,440,000 | $ 260,740,000 | $ 347,260,000 | $ 264,908,000 |
Current receivables of finance contracts not yet sold | 66,886,000 | 88,470,000 | ||
Unearned income | 4,506,000 | 4,197,000 | ||
Finance contracts receivable sold and outstanding | 554,072,000 | |||
Deferred purchase price | $ 79,392,000 | 66,715,000 | ||
Bad debt write-offs, percentage, maximum | 1.00% | |||
Unsettled Financing Arrangements [Member] | ||||
Customer Financing [Line Items] | ||||
Cash and cash equivalents | $ 26,202,000 | $ 29,863,000 | ||
The Bank of Tokyo-Mitsubishi UFJ, Ltd. [Member] | ||||
Customer Financing [Line Items] | ||||
Capacity under agreement | 500,000,000 | |||
Fifth Third Bank [Member] | ||||
Customer Financing [Line Items] | ||||
Capacity under agreement | $ 100,000,000 | |||
Minimum [Member] | The Bank of Tokyo-Mitsubishi UFJ, Ltd. [Member] | ||||
Customer Financing [Line Items] | ||||
Percentage of principal amount of financing contracts held as collateral | 13.00% | |||
Minimum [Member] | Fifth Third Bank [Member] | ||||
Customer Financing [Line Items] | ||||
Percentage of principal amount of financing contracts held as collateral | 23.00% |
Segment Reporting - Additional
Segment Reporting - Additional Information (Detail) - Segment | 3 Months Ended | 12 Months Ended |
Aug. 01, 2015 | Apr. 25, 2015 | |
Segment Reporting [Abstract] | ||
Number of reportable segments | 3 | 3 |
Segment Reporting - Information
Segment Reporting - Information about Reportable Segments (Detail) - USD ($) $ in Thousands | 3 Months Ended | ||
Aug. 01, 2015 | Jul. 26, 2014 | Apr. 25, 2015 | |
Segment Reporting Information [Line Items] | |||
Net sales | $ 1,142,870 | $ 938,956 | |
Operating income (loss) from continuing operations | 62,177 | 65,996 | |
Total assets, excluding assets held for sale | 3,472,592 | $ 2,193,565 | |
Assets held for sale | 767,062 | 754,141 | |
Total assets | 4,239,654 | 2,947,706 | |
Corporate [Member] | |||
Segment Reporting Information [Line Items] | |||
Net sales | 10,456 | 9,782 | |
Operating income (loss) from continuing operations | (18,047) | (10,540) | |
Total assets, excluding assets held for sale | 494,647 | 539,863 | |
Dental [Member] | |||
Segment Reporting Information [Line Items] | |||
Net sales | 575,117 | 542,874 | |
Operating income (loss) from continuing operations | 67,252 | 62,549 | |
Total assets, excluding assets held for sale | 920,035 | 1,022,257 | |
Animal Health [Member] | |||
Segment Reporting Information [Line Items] | |||
Net sales | 557,297 | 386,300 | |
Operating income (loss) from continuing operations | 12,972 | $ 13,987 | |
Total assets, excluding assets held for sale | $ 2,057,910 | $ 631,445 |
Segment Reporting - Sales Infor
Segment Reporting - Sales Information by Product (Detail) - USD ($) $ in Thousands | 3 Months Ended | |
Aug. 01, 2015 | Jul. 26, 2014 | |
Segment Reporting Information [Line Items] | ||
Net sales | $ 1,142,870 | $ 938,956 |
Consumables [Member] | ||
Segment Reporting Information [Line Items] | ||
Net sales | 895,307 | 695,639 |
Equipment and Software [Member] | ||
Segment Reporting Information [Line Items] | ||
Net sales | 153,483 | 156,394 |
Other Products and Services [Member] | ||
Segment Reporting Information [Line Items] | ||
Net sales | $ 94,080 | $ 86,923 |
Accumulated Other Comprehensi48
Accumulated Other Comprehensive Loss - Summary of Accumulated Other Comprehensive Loss (Detail) $ in Thousands | 3 Months Ended |
Aug. 01, 2015USD ($) | |
Accumulated Other Comprehensive Income (Loss) [Line Items] | |
AOCL at April 25, 2015 | $ (60,346) |
Other comprehensive loss before reclassifications | (11,275) |
Amounts reclassified from AOCL | 617 |
AOCL at August 1, 2015 | (71,004) |
Cash Flow Hedges [Member] | |
Accumulated Other Comprehensive Income (Loss) [Line Items] | |
AOCL at April 25, 2015 | (18,668) |
Amounts reclassified from AOCL | 617 |
AOCL at August 1, 2015 | (18,051) |
Currency Translation Adjustment [Member] | |
Accumulated Other Comprehensive Income (Loss) [Line Items] | |
AOCL at April 25, 2015 | (41,678) |
Other comprehensive loss before reclassifications | (11,275) |
AOCL at August 1, 2015 | $ (52,953) |
Accumulated Other Comprehensi49
Accumulated Other Comprehensive Loss - Additional Information (Detail) - USD ($) $ in Thousands | 3 Months Ended | |
Aug. 01, 2015 | Jul. 26, 2014 | |
Uncategorized [Abstract] | ||
Gains and losses on cash flow hedges, tax | $ 85 | $ (4,813) |
Increase in interest expense | $ 702 |
Debt Issuance - Additional Info
Debt Issuance - Additional Information (Detail) - USD ($) | Aug. 28, 2015 | Jun. 16, 2015 | Aug. 01, 2015 | Apr. 25, 2015 |
Line of Credit Facility [Line Items] | ||||
Credit facility, borrowed amount | $ 0 | $ 0 | ||
Credit Agreement [Member] | ||||
Line of Credit Facility [Line Items] | ||||
Credit facility, maximum borrowing capacity | $ 1,500,000,000 | |||
Credit facility, expiration date | Jun. 16, 2020 | |||
LIBOR [Member] | Minimum [Member] | Credit Agreement [Member] | ||||
Line of Credit Facility [Line Items] | ||||
Credit facility, basis spread rate | 1.125% | |||
LIBOR [Member] | Maximum [Member] | Credit Agreement [Member] | ||||
Line of Credit Facility [Line Items] | ||||
Credit facility, basis spread rate | 2.00% | |||
Unsecured Term Loan [Member] | Credit Agreement [Member] | ||||
Line of Credit Facility [Line Items] | ||||
Credit facility, maximum borrowing capacity | $ 1,000,000,000 | |||
Credit facility, borrowed amount | 1,000,000,000 | |||
Unsecured Term Loan [Member] | Subsequent Event [Member] | Credit Agreement [Member] | ||||
Line of Credit Facility [Line Items] | ||||
Credit facility, borrowed amount | $ 1,000,000,000 | |||
Credit facility, amount repaid | $ 670,000,000 | |||
Unsecured Revolving Line of Credit [Member] | Credit Agreement [Member] | ||||
Line of Credit Facility [Line Items] | ||||
Credit facility, maximum borrowing capacity | 500,000,000 | |||
Credit facility, borrowed amount | 200,000,000 | |||
Credit Facility Expiring on December 2016 [Member] | ||||
Line of Credit Facility [Line Items] | ||||
Credit facility, maximum borrowing capacity | $ 300,000,000 |
Income Taxes - Additional Infor
Income Taxes - Additional Information (Detail) - USD ($) $ in Thousands | 3 Months Ended | |
Aug. 01, 2015 | Jul. 26, 2014 | |
Income Tax Disclosure [Abstract] | ||
Effective income tax rate | 59.90% | 34.60% |
Repatriation of foreign earnings | $ 200,000 | |
Tax impact of repatriation of foreign earnings | $ 11,800 |
Subsequent Events - Additional
Subsequent Events - Additional Information (Detail) - USD ($) | Aug. 28, 2015 | Aug. 01, 2015 | Jun. 16, 2015 | Apr. 25, 2015 |
Subsequent Event [Line Items] | ||||
Credit facility, borrowed amount | $ 0 | $ 0 | ||
Unsecured Term Loan [Member] | Credit Agreement [Member] | ||||
Subsequent Event [Line Items] | ||||
Credit facility, borrowed amount | $ 1,000,000,000 | |||
Unsecured Term Loan [Member] | Subsequent Event [Member] | Credit Agreement [Member] | ||||
Subsequent Event [Line Items] | ||||
Credit facility, amount repaid | $ 670,000,000 | |||
Credit facility, borrowed amount | $ 1,000,000,000 |