Document and Entity Information
Document and Entity Information - USD ($) | 12 Months Ended | ||
Dec. 29, 2018 | Feb. 02, 2019 | Jun. 30, 2018 | |
Document and Entity Information [Abstract] | |||
Entity Registrant Name | UNIVERSAL FOREST PRODUCTS INC | ||
Entity Central Index Key | 912,767 | ||
Current Fiscal Year End Date | --12-29 | ||
Entity Filer Category | Large Accelerated Filer | ||
Entity Common Stock, Shares Outstanding (in shares) | 60,890,762 | ||
Entity Public Float | $ 2,136,389,121 | ||
Entity Well-known Seasoned Issuer | Yes | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Document Fiscal Year Focus | 2,018 | ||
Document Fiscal Period Focus | FY | ||
Document Type | 10-K | ||
Amendment Flag | false | ||
Document Period End Date | Dec. 29, 2018 | ||
Entity Small Business | false | ||
Entity Emerging Growth Company | false | ||
Entity Shell Company | false |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Dec. 29, 2018 | Dec. 30, 2017 |
CURRENT ASSETS: | ||
Cash and cash equivalents | $ 27,316 | $ 28,339 |
Restricted cash | 882 | 477 |
Investments | 14,755 | 11,269 |
Accounts receivable, net | 343,450 | 327,751 |
Inventories: | ||
Raw materials | 271,871 | 234,354 |
Finished goods | 284,349 | 225,954 |
Total inventories | 556,220 | 460,308 |
Refundable income taxes | 14,130 | 7,228 |
Other current assets | 38,525 | 28,115 |
TOTAL CURRENT ASSETS | 995,278 | 863,487 |
DEFERRED INCOME TAXES | 2,668 | 1,865 |
RESTRICTED INVESTMENTS | 13,267 | 8,359 |
OTHER ASSETS | 8,662 | 7,368 |
GOODWILL | 224,117 | 212,644 |
INDEFINITE-LIVED INTANGIBLE ASSETS | 7,360 | 7,415 |
OTHER INTANGIBLE ASSETS, NET | 41,486 | 34,910 |
PROPERTY, PLANT AND EQUIPMENT: | ||
Land and improvements | 120,324 | 134,916 |
Building and improvements | 239,906 | 213,384 |
Machinery and equipment | 419,115 | 372,628 |
Furniture and fixtures | 16,960 | 25,251 |
Construction in progress | 18,340 | 16,922 |
PROPERTY, PLANT AND EQUIPMENT,GROSS | 814,645 | 763,101 |
Less accumulated depreciation and amortization | (459,935) | (434,472) |
PROPERTY, PLANT AND EQUIPMENT, NET | 354,710 | 328,629 |
TOTAL ASSETS | 1,647,548 | 1,464,677 |
CURRENT LIABILITIES: | ||
Cash overdraft | 27,367 | 25,851 |
Accounts payable | 136,901 | 140,106 |
Accrued liabilities: | ||
Compensation and benefits | 104,109 | 97,556 |
Other | 41,645 | 38,404 |
Current portion of long-term debt | 148 | 1,329 |
TOTAL CURRENT LIABILITIES | 310,170 | 303,246 |
LONG-TERM DEBT | 202,130 | 144,674 |
DEFERRED INCOME TAXES | 15,687 | 14,079 |
OTHER LIABILITIES | 30,877 | 28,655 |
TOTAL LIABILITIES | 558,864 | 490,654 |
Controlling interest shareholders' equity: | ||
Preferred stock, no par value; shares authorized 1,000,000; issued and outstanding, none | ||
Common stock, $1 par value; shares authorized 80,000,000; issued and outstanding, 60,883,749 and 61,191,888 | 60,884 | 61,192 |
Additional paid-in capital | 178,540 | 161,928 |
Retained earnings | 839,917 | 736,212 |
Accumulated other comprehensive income | (5,938) | 144 |
Total controlling interest shareholders' equity | 1,073,403 | 959,476 |
Noncontrolling interest | 15,281 | 14,547 |
TOTAL SHAREHOLDERS' EQUITY | 1,088,684 | 974,023 |
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY | $ 1,647,548 | $ 1,464,677 |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares | Dec. 29, 2018 | Dec. 30, 2017 |
SHAREHOLDERS' EQUITY: | ||
Preferred stock, no par value (in dollars per share) | $ 0 | $ 0 |
Preferred stock, shares authorized (in shares) | 1,000,000 | 1,000,000 |
Preferred stock, shares issued (in shares) | 0 | 0 |
Preferred stock, shares outstanding (in shares) | 0 | 0 |
Common Stock, Par or Stated Value Per Share | $ 1 | $ 1 |
Common stock, shares authorized (in shares) | 80,000,000 | 80,000,000 |
Common stock, shares issued (in shares) | 60,883,749 | 61,191,888 |
Common stock, shares outstanding (in shares) | 60,883,749 | 61,191,888 |
CONSOLIDATED STATEMENTS OF EARN
CONSOLIDATED STATEMENTS OF EARNINGS AND COMPREHENSIVE INCOME - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 29, 2018 | Dec. 30, 2017 | Dec. 31, 2016 | |
CONSOLIDATED CONDENSED STATEMENTS OF EARNINGS | |||
NET SALES | $ 4,489,180 | $ 3,941,182 | $ 3,240,493 |
COST OF GOODS SOLD | 3,896,286 | 3,398,356 | 2,765,903 |
GROSS PROFIT | 592,894 | 542,826 | 474,590 |
SELLING, GENERAL AND ADMINISTRATIVE EXPENSES | 392,235 | 362,220 | 310,152 |
NET (GAIN) ON DISPOSITION OF ASSETS | (6,604) | (863) | |
EARNINGS FROM OPERATIONS | 207,263 | 181,469 | 164,438 |
INTEREST EXPENSE | 8,893 | 6,218 | 4,575 |
INTEREST INCOME | (1,371) | (731) | (541) |
UNREALIZED LOSS (GAIN) ON INVESTMENTS AND OTHER | (1,888) | 25 | 267 |
NON-OPERATING (INCOME)/EXPENSE | 9,410 | 5,462 | 3,767 |
EARNINGS BEFORE INCOME TAXES | 197,853 | 176,007 | 160,671 |
INCOME TAXES | 45,441 | 51,967 | 55,174 |
NET EARNINGS | 152,412 | 124,040 | 105,497 |
LESS NET EARNINGS ATTRIBUTABLE TO NONCONTROLLING INTEREST | (3,814) | (4,528) | (4,318) |
NET EARNINGS ATTRIBUTABLE TO CONTROLLING INTEREST | $ 148,598 | $ 119,512 | $ 101,179 |
EARNINGS PER SHARE - BASIC (USD per share) | $ 2.41 | $ 1.95 | $ 1.66 |
EARNINGS PER SHARE - DILUTED (USD per share) | $ 2.40 | $ 1.94 | $ 1.65 |
OTHER COMPREHENSIVE INCOME: | |||
NET EARNINGS | $ 152,412 | $ 124,040 | $ 105,497 |
OTHER COMPREHENSIVE GAIN (LOSS) | (5,076) | 6,130 | (2,703) |
COMPREHENSIVE INCOME | 147,336 | 130,170 | 102,794 |
LESS COMPREHENSIVE INCOME ATTRIBUTABLE TO NONCONTROLLING INTEREST | (3,873) | (4,884) | (2,660) |
COMPREHENSIVE INCOME ATTRIBUTABLE TO CONTROLLING INTEREST | $ 143,463 | $ 125,286 | $ 100,134 |
CONSOLIDATED STATEMENTS OF SHAR
CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY - USD ($) $ in Thousands | Common Stock | Additional Paid-In Capital | Retained Earnings | Accumulated Other Comprehensive Earnings | Noncontrolling Interest | Total |
Beginning balance at Dec. 26, 2015 | $ 60,425 | $ 131,279 | $ 565,636 | $ (4,585) | $ 13,654 | $ 766,409 |
Increase (Decrease) in Stockholders' Equity | ||||||
Net earnings | 101,179 | 4,318 | 105,497 | |||
Foreign currency translation adjustment | (1,316) | (1,658) | (2,974) | |||
Unrealized gain (loss) on investment | 271 | 271 | ||||
Distributions to noncontrolling interest | (3,280) | (3,280) | ||||
Net purchase and dissolution of non-controlling interest | 856 | (1,748) | (892) | |||
Cash dividends | (17,680) | (17,680) | ||||
Issuance of shares under employee stock purchase plans | 21 | 515 | 536 | |||
Issuance of shares under stock grant programs | 407 | 4,890 | 5,297 | |||
Issuance of shares under deferred compensation plans | 173 | (173) | ||||
Expense associated with share-based compensation arrangements | 2,208 | 2,208 | ||||
Accrued expense under deferred compensation plans | 5,074 | 5,074 | ||||
Ending balance at Dec. 31, 2016 | 61,026 | 144,649 | 649,135 | (5,630) | 11,286 | 860,466 |
Increase (Decrease) in Stockholders' Equity | ||||||
Net earnings | 119,512 | 4,528 | 124,040 | |||
Foreign currency translation adjustment | 5,070 | 356 | 5,426 | |||
Unrealized gain (loss) on investment & foreign currency | 704 | 704 | ||||
Distributions to noncontrolling interest | (4,032) | (4,032) | ||||
Additional purchases of noncontrolling interest | 2,409 | 2,409 | ||||
Cash dividends | (19,607) | (19,607) | ||||
Issuance of shares under employee stock purchase plans | 24 | 637 | 661 | |||
Issuance of shares under stock grant programs | 429 | 5,769 | 6,198 | |||
Issuance of shares under deferred compensation plans | 159 | (159) | ||||
Repurchase of shares | (446) | 297 | (12,828) | (12,977) | ||
Expense associated with share-based compensation arrangements | 3,618 | 3,618 | ||||
Accrued expense under deferred compensation plans | 7,117 | 7,117 | ||||
Ending balance at Dec. 30, 2017 | 61,192 | 161,928 | 736,212 | 144 | 14,547 | 974,023 |
Increase (Decrease) in Stockholders' Equity | ||||||
Net earnings | 148,598 | 3,814 | 152,412 | |||
Foreign currency translation adjustment | (4,973) | 59 | (4,914) | |||
Unrealized gain (loss) on investment & foreign currency | 947 | (1,109) | (162) | |||
Distributions to noncontrolling interest | (3,139) | (3,139) | ||||
Cash dividends | (22,072) | (22,072) | ||||
Issuance of shares under employee stock purchase plans | 38 | 988 | 1,026 | |||
Issuance of shares under stock grant programs | 348 | 4,827 | 5,175 | |||
Issuance of shares under deferred compensation plans | 167 | (167) | ||||
Repurchase of shares | (861) | (23,768) | (24,629) | |||
Expense associated with share-based compensation arrangements | 3,379 | 3,379 | ||||
Accrued expense under deferred compensation plans | 7,585 | 7,585 | ||||
Ending balance at Dec. 29, 2018 | $ 60,884 | $ 178,540 | $ 839,917 | $ (5,938) | $ 15,281 | $ 1,088,684 |
CONSOLIDATED STATEMENTS OF SH_2
CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY (Parenthetical) - $ / shares | 6 Months Ended | 12 Months Ended | |||||
Dec. 30, 2017 | Jul. 01, 2017 | Dec. 31, 2016 | Jun. 25, 2016 | Dec. 29, 2018 | Dec. 30, 2017 | Dec. 31, 2016 | |
Increase (Decrease) in Stockholders' Equity | |||||||
Cash dividends per share (USD per share) | $ 0.170 | $ 0.150 | $ 0.150 | $ 0.140 | $ 0.180 | ||
Issuance of shares under employee stock plans (in shares) | 37,794 | 23,691 | 20,439 | ||||
Issuance of shares under stock grant programs (in shares) | 348,208 | 428,622 | 407,271 | ||||
Issuance of shares under deferred compensation plans (in shares) | 166,528 | 159,108 | 173,370 | ||||
Repurchase of shares (in shares) | 860,669 | 445,740 | 13,613 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 29, 2018 | Dec. 30, 2017 | Dec. 31, 2016 | |
CASH FLOWS FROM OPERATING ACTIVITIES: | |||
Net earnings | $ 152,412 | $ 124,040 | $ 105,497 |
Adjustments to reconcile net earnings to net cash from operating activities: | |||
Depreciation | 54,949 | 48,536 | 40,823 |
Amortization of intangibles | 6,393 | 4,860 | 2,795 |
Expense associated with share-based and grant compensation arrangements | 3,574 | 3,805 | 2,335 |
Deferred income taxes (credits) | 857 | (8,629) | 2,464 |
Unrealized loss (gain) on investments and other | 1,888 | (25) | (267) |
Net (gain) on disposition of assets | (6,604) | (863) | |
Changes in: | |||
Accounts receivable | (8,512) | (30,787) | (5,119) |
Inventories | (84,304) | (49,262) | (3,245) |
Accounts payable and cash overdraft | (5,213) | 21,159 | 11,259 |
Accrued liabilities and other | 1,245 | 23,749 | 15,978 |
NET CASH FROM OPERATING ACTIVITIES | 116,685 | 136,583 | 172,520 |
CASH FLOWS FROM INVESTING ACTIVITIES: | |||
Purchases of property, plant and equipment | (95,862) | (71,116) | (53,762) |
Proceeds from sale of property, plant and equipment | 38,373 | 2,919 | 3,126 |
Acquisitions, net of cash received | (54,017) | (60,587) | (80,077) |
Repayments of debt of acquiree | (92,830) | ||
Purchase and dissolution of remaining noncontrolling interest in subsidiary | (892) | ||
Advances of notes receivable | (434) | (234) | (6,012) |
Collections on notes receivable | 768 | 1,509 | 7,899 |
Purchases of investments | (13,338) | (13,518) | (5,666) |
Proceeds from sale of investments | 3,678 | 5,103 | 2,568 |
Other | (400) | (1,735) | (2,011) |
NET CASH USED IN INVESTING ACTIVITIES | (121,232) | (137,659) | (227,657) |
CASH FLOWS FROM FINANCING ACTIVITIES: | |||
Borrowings under revolving credit facilities | 732,370 | 758,287 | 131,002 |
Repayments under revolving credit facilities | (748,496) | (722,725) | (107,294) |
Borrowings of debt | 927 | 8,525 | |
Repayment of debt | (5,540) | (13,347) | |
Issuance of long-term debt | 75,000 | ||
Proceeds from issuance of common stock | 1,026 | 660 | 536 |
Dividends paid to shareholders | (3,139) | (4,032) | (3,280) |
Distributions to noncontrolling interest | (22,072) | (19,607) | (17,680) |
Repurchase of common stock | (24,629) | (12,977) | |
Other | (1,054) | (31) | (73) |
NET CASH FROM (USED IN) FINANCING ACTIVITIES | 4,393 | (5,247) | 3,211 |
Effect of exchange rate changes on cash | (464) | 650 | (1,927) |
NET CHANGE IN CASH AND CASH EQUIVALENTS | (618) | (5,673) | (53,853) |
CASH, CASH EQUIVALENTS, AND RESTRICTED CASH, BEGINNING OF PERIOD | 28,816 | 34,489 | 88,342 |
CASH, CASH EQUIVALENTS, AND RESTRICTED CASH, END OF PERIOD | $ 28,198 | $ 28,816 | $ 34,489 |
CONSOLIDATED STATEMENTS OF CA_2
CONSOLIDATED STATEMENTS OF CASH FLOWS - SUPPLEMENTAL - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 29, 2018 | Dec. 30, 2017 | Dec. 31, 2016 | |
RECONCILIATION OF CASH AND CASH EQUIVALENTS AND RESTRICTED CASH: | |||
Cash and cash equivalents, beginning of period | $ 28,339 | $ 34,091 | $ 87,756 |
Restricted cash, beginning of period | 477 | 398 | 586 |
CASH, CASH EQUIVALENTS, AND RESTRICTED CASH, BEGINNING OF PERIOD | 28,816 | 34,489 | 88,342 |
Cash and cash equivalents, end of period | 27,316 | 28,339 | 34,091 |
Restricted cash, end of period | 882 | 477 | 398 |
CASH, CASH EQUIVALENTS, AND RESTRICTED CASH, END OF PERIOD | 28,198 | 28,816 | 34,489 |
SUPPLEMENTAL INFORMATION: | |||
Interest paid | 8,860 | 6,020 | 4,550 |
Income taxes paid | 51,578 | 56,663 | 57,311 |
NON-CASH FINANCING ACTIVITIES: | |||
Common stock issued under deferred compensation plans | $ 5,837 | $ 5,116 | $ 4,353 |
SUMMARY OF SIGNIFICANT ACCOUNTI
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 12 Months Ended |
Dec. 29, 2018 | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | A. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES OPERATIONS We design, manufacture and market wood and wood-alternative products for large home centers and other retailers; structural lumber, engineered wood components, framing services, and other products for the construction market; specialty wood packaging, components, packing materials, and other wood-based products for various industries; and design, manufacture, and install customized interior fixtures used in retail and commercial structures for various markets. PRINCIPLES OF CONSOLIDATION The consolidated financial statements include our accounts and those of our wholly-owned and majority-owned subsidiaries and partnerships. In addition, we consolidate any entity which we own 50% or more and exercise control. Intercompany transactions and balances have been eliminated. NONCONTROLLING INTEREST IN SUBSIDIARIES Noncontrolling interest in results of operations of consolidated subsidiaries represents the noncontrolling shareholders’ share of the income or loss of various consolidated subsidiaries. The noncontrolling interest reflects the original investment by these noncontrolling shareholders combined with their proportional share of the earnings or losses of these subsidiaries, net of distributions paid. FISCAL YEAR Our fiscal year is a 52 or 53 week period, ending on the last Saturday of December. Unless otherwise stated, references to 2018, 2017, and 2016 relate to the fiscal years ended December 29, 2018, December 30, 2017, and December 31, 2016, respectively. Fiscal year 2016 was comprised of 53 weeks, which contributed an additional $ 60 million in sales in 2016 compared to fiscal years 2018 and 2017, which were comprised of 52 weeks. FAIR VALUE DISCLOSURES OF FINANCIAL INSTRUMENTS We follow ASC Topic 820, Fair Value Measurements and Disclosures , which provides a consistent definition of fair value, focuses on exit price, prioritizes the use of market-based inputs over entity-specific inputs for measuring fair value and establishes a three-tier hierarchy for fair value measurements. This topic requires fair value measurements to be classified and disclosed in one of the following three categories: · Level 1 — Financial instruments with unadjusted, quoted prices listed on active market exchanges. · Level 2 — Financial instruments lacking unadjusted, quoted prices from active market exchanges, including over-the-counter traded financial instruments. Financial instrument values are determined using prices for recently traded financial instruments with similar underlying terms and direct or indirect observational inputs, such as interest rates and yield curves at commonly quoted intervals. · Level 3 — Financial instruments not actively traded on a market exchange and there is little, if any, market activity. Values are determined using significant unobservable inputs or valuation techniques. CASH AND CASH EQUIVALENTS Cash and cash equivalents consist of cash and highly-liquid investments purchased with an original maturity of three months or less. In November 2016, the Financial Accounting Standards Board (FASB) issued Accounting Standard Update (ASU) No. 2016-18, “Statement of Cash Flows (Topic 230)” (ASU 2016-18). Under ASU 2016-18, an entity will be required to explain changes in the statement of cash flows during the period in the total of cash, cash equivalents, and amounts generally described as restricted cash or restricted cash equivalents. Therefore, amounts generally described as restricted cash and restricted cash equivalents should be included with cash and cash equivalents when reconciling the beginning-of-period and end-of-period total amounts shown on the statement of cash flows. The amendments in this update should be applied using retrospective transition method to each period presented. Companies are required to adopt the new standard for fiscal years beginning after December 15, 2017. Early adoption of ASU 2016-18 is permitted, including adoption in an interim period. The Company has early adopted this standard during the first quarter of 2017. INVESTMENTS Investments are deemed to be "available for sale" and are, accordingly, carried at fair value being the quoted market value. In January 2016, the FASB issued ASU No. 2016-01, Recognition and Measurement of Financial Assets and Financial Liabilities, which amends ASC 825-10, Financial Instruments – Overall, this ASU changes the treatment for available-for-sale equity investments by recognizing unrealized fair value changes directly in net income and no longer in other comprehensive income. For public entities, the amendment is effective for fiscal years beginning after December 15, 2017. The ASU was adopted during fiscal 2018 with a cumulative-effect adjustment to retained earnings of $0.9 million at the beginning of 2018. The available-for-sale equity securities balance at December 29, 2018 is $10.7 million, which resulted in an unrealized loss recorded as a non-operating expense of $1.9 million. ACCOUNTS RECEIVABLE AND ALLOWANCES We perform periodic credit evaluations of our customers and generally do not require collateral. Accounts receivable are due under a range of terms we offer to our customers. Discounts are offered, in most instances, as an incentive for early payment. We base our allowances related to receivables on historical credit and collections experience, and the specific identification of other potential problems, including the general economic climate. Actual collections can differ, requiring adjustments to the allowances. Individual accounts receivable balances are evaluated on a monthly basis, and those balances considered uncollectible are charged to the allowance. The following table presents the activity in our accounts receivable allowances (in thousands): Additions Charged to Beginning Costs and Ending Balance Expenses Deductions* Balance Year Ended December 29,2018: Allowance for possible losses on accounts receivable $ 2,424 $ 38,963 $ (38,786) $ 2,601 Year Ended December 30, 2017: Allowance for possible losses on accounts receivable $ 2,845 $ 28,102 $ (28,523) $ 2,424 Year Ended December 31, 2016: Allowance for possible losses on accounts receivable $ 2,672 $ 28,405 $ (28,232) $ 2,845 * We record estimated sales returns, discounts, and other applicable adjustments as a reduction of net sales in the same period revenue is recognized. Accounts receivable retainage amounts related to long term construction contracts totaled $5.5 million and $4.8 million as of December 29, 2018 and December 30, 2017, respectively. All amounts are expected to be collected within 18 months. Concentration of accounts receivable related to our largest customer totaled $44.5 million and $55.9 million as of December 29, 2018 and December 30, 2017, respectively. INVENTORIES Inventories are stated at the lower of cost or market. The cost of inventories includes raw materials, direct labor, and manufacturing overhead. Cost is determined on a weighted average basis. Raw materials consist primarily of unfinished wood products expected to be manufactured or treated prior to sale, while finished goods represent various manufactured and treated wood products ready for sale. We have inventory on consignment at customer locations valued at $16.8 million as of December 29, 2018 and $14.8 million as of December 30, 2017. PROPERTY, PLANT, AND EQUIPMENT Property, plant, and equipment are stated at cost. Expenditures for renewals and betterments are capitalized, and maintenance and repairs are expensed as incurred. Amortization of assets held under capital leases is included in depreciation and amortized over the shorter of the estimated useful life of the asset or the lease term. Depreciation is computed principally by the straight-line method over the estimated useful lives of the assets as follows: Land improvements 5 to 15 years Buildings and improvements 10 to 32 years Machinery, equipment and office furniture 2 to 8 years LONG-LIVED ASSETS In accordance with ASC 360, Property, Plant, and Equipment (“ASC 360”), when an indicator of potential impairment exists, we evaluate the recoverability of our long-lived assets by determining whether unamortized balances could be recovered through undiscounted future operating cash flows over the remaining lives of the assets. If the sum of the expected future cash flows was less than the carrying value of the assets, an impairment loss would be recognized for the excess of the carrying value over the fair value. LEASES In February 2016, the Financial Accounting Standards Board (FASB) issued Accounting Standard Update (ASU) No. 2016‑02, “Leases (Topic 842)” (ASU 2016‑02). Under ASU 2016‑02, an entity will be required to recognize assets and liabilities for the rights and obligations created by leases on the entity’s balance sheet for both finance and operating leases. For leases with a term of 12 months or less, an entity can elect to not recognize lease assets and lease liabilities and expense the lease over a straight-line basis for the term of the lease. ASU 2016‑02 will require new disclosures that depict the amount, timing, and uncertainty of cash flows pertaining to an entity’s leases. Companies are required to adopt the new standard for annual and interim periods beginning after December 15, 2018. Early adoption of ASU 2016‑02 is permitted. The FASB has decided to amend certain aspects of its new leasing standard in an attempt to provide a relief from implementation costs. Specifically, entities may elect not to restate their comparative periods in the period of adoption when transitioning to the new standard. The Company will elect practical expedients permitted under the transition guidance within the new standard, which among other things, allows the carryforward of historical lease classification, lease and related non-lease components accounted as a single component, and hindsight practical expedient to determine the reasonably certain lease term for existing leases. As required by the standard, the Company expects to make additional disclosures related to the nature and type of leases, practical expedients applied, and adoption method in the first quarter of 2019 fiscal year. The Company expects $60-80 million impact on our consolidated balance sheets and no material impact on our consolidated income statement. GOODWILL Goodwill represents the excess of the purchase price over the fair value of net tangible and identifiable intangible assets of acquired businesses. Goodwill and intangible assets deemed to have indefinite lives are not amortized, but are subject to impairment tests at least annually in accordance with ASC 350, Intangibles-Goodwill and Other. We review the carrying amounts of goodwill and other non-amortizable intangibles by reporting unit to determine if such assets may be impaired. As the carrying amount of these assets are recoverable based upon a discounted cash flow and market approach analysis, no impairment was recognized. Our annual testing date for evaluating goodwill and indefinite-lived intangible asset impairment is the first day of the Company’s fourth fiscal quarter for all reporting units. Additionally, the Company reviews various triggering events throughout the year to ensure that a mid-year impairment analysis is not required. FOREIGN CURRENCY Our foreign operations use the local currency as their functional currency. Accordingly, assets and liabilities are translated at exchange rates as of the balance sheet date and revenues and expenses are translated using weighted average rates, with translation adjustments included as a separate component of shareholders’ equity. Gains and losses arising from re-measuring foreign currency transactions are included in earnings. INSURANCE RESERVES Our wholly-owned insurance company, Ardellis Insurance Ltd.(“Ardellis”), was incorporated on April 21, 2001 under the laws of Bermuda and is licensed as a Class 3A insurer under the Insurance Act 1978 of Bermuda. On April 14, 2017 the U.S. Branch of Ardellis Insurance Ltd. was granted its Certificate of Authority to transact property and casualty insurance lines as an admitted carrier in the State of Michigan. We are primarily self-insured for certain employee health benefits, and have self-funded retentions for general liability, automobile liability, property and workers’ compensation. We are fully self-insured for environmental liabilities. The general liability, automobile liability, property, workers’ compensation, and certain environmental liabilities are managed through Ardellis; the related assets and liabilities of which are included in the consolidated financial statements as of December 29, 2018 and December 30, 2017. Our policy is to accrue amounts equal to actuarially determined or internally computed liabilities. The actuarial and internal valuations are based on historical information along with certain assumptions about future events. Changes in assumptions for such matters as legal actions, medical cost trends, and changes in claims experience could cause these estimates to change in the future. In addition to providing coverage for the Company, Ardellis provides Excess Loss Insurance (primarily medical and prescription drug) to certain third parties. As of December 29, 2018, Ardellis had 39 such contracts in place. Reserves associated with these contracts were $4.9 million at December 29, 2018 and $3.4 million at December 30, 2017, and are accrued based on third party actuarial valuations of the expected future liabilities. INCOME TAXES Deferred income tax assets and liabilities are computed for differences between the financial statement and tax basis of assets and liabilities that will result in taxable or deductible amounts in the future. Such deferred income tax asset and liability computations are based on enacted tax laws and rates. Valuation allowances are established when necessary to reduce deferred income tax assets to the amounts expected to be realized. Income tax expense is the tax payable or refundable for the period plus or minus the change during the period in deferred income tax assets and liabilities. REVENUE RECOGNITION On May 28, 2014, the FASB issued ASU No. 2014-09 (Accounting Standard Codification 606), Revenue from Contracts with Customers. Topic 606 supersedes the revenue recognition requirements in Accounting Standards Codification Topic 605, Revenue Recognition, and requires the recognition of revenue when promised goods or services are transferred to customers in an amount that reflects the considerations to which the entity expects to be entitled to in exchange for those goods or services. The ASU requires additional disclosure about the nature, amount, timing and uncertainty of revenue and cash flows arising from customer contracts, including significant judgments and changes in judgments. The Company has adopted the requirements of the new standard as of January 1, 2018, and utilized the modified retrospective method of transition which was applied to all contracts. The Company completed the new revenue recognition standard assessment and determined that there was no material impact to our consolidated financial statements, aside from additional required disclosures, thus no needed adjustment to the opening retained earnings for the annual reporting period. Within the three markets (retail, industrial, and construction) that the Company operates, there are a variety of written and oral contracts that are utilized to generate revenue from the sale of wood, wood composite and other products. The transaction price is stated at the purchase order level, which includes shipping and/or freight costs and any applicable governmental authority taxes. The majority of our contracts have a single performance obligation concentrated around the delivery of goods to the carrier, Free On Board (FOB) shipping point. Therefore, revenue is recognized when this performance obligation is satisfied. Generally, title and control passes at the time of shipment. In certain circumstances, the customer takes title when the shipment arrives at the destination. However, our shipping process is typically completed the same day. Certain customer products that we provide require installation by the Company or a 3rd party. Installation revenue is recognized upon completion, which is typically 2-3 days after receipt. If it is determined to utilize a 3rd party for installation, the party will act as an agent to the Company until completion of the installation. Installation revenue represents an immaterial share of the Company’s total sales. The Company utilizes rebates, credits, discounts and/or cash-based incentives with certain customers which are accounted for as variable consideration. We estimate these amounts based on historical and anticipated customer sales and reduce recognized revenues accordingly. We believe that there will not be significant changes to our estimates of variable consideration. Our estimates of variable consideration are considered not constrained as the likelihood and magnitude of a significant reversal are not probable. The allocation of these costs are applied at the invoice level and recognized in conjunction with revenue. Additionally, the volume returns and refunds are estimated on a historical and expected basis which is a reduction of revenue recognized. Earnings on construction contracts are reflected in operations using over time accounting, under either cost to cost or units of delivery methods, depending on the nature of the business at individual operations, which is in accordance with ASC 606 as revenue is recognized when certain performance obligations are performed. Under over time accounting using the cost to cost method, revenues and related earnings on construction contracts are measured by the relationships of actual costs incurred related to the total estimated costs. Under over time accounting using the units of delivery method, revenues and related earnings on construction contracts are measured by the relationships of actual units produced related to the total number of units. Revisions in earnings estimates on the construction contracts are recorded in the accounting period in which the basis for such revisions becomes known. Projected losses on individual contracts are charged to operations in their entirety when such losses become apparent. Our construction contracts are generally entered into with a fixed price and completion of the projects and performance obligations can range from 6 to 18 months in duration. Therefore, our operating results are impacted by, among many other things, labor rates and commodity costs. Invoices are issued routinely throughout the projects’ life and payments are primarily due 45-60 days after invoice date. During the year, we update our estimated costs to complete our projects using current labor and commodity costs and recognize losses to the extent that they exist. The following table presents our gross revenues disaggregated by revenue source: (in thousands) December 29, December 30, Market Classification 2018 2017 % Change FOB Shipping Point Revenue $ 4,440,098 $ 3,867,781 Construction Contract Revenue 125,651 138,422 -9.2% Total Gross Sales 4,565,749 4,006,203 Sales Allowances (76,569) (65,021) Total Net Sales $ 4,489,180 $ 3,941,182 In 2018, $77.8 million and $47.8 million of our construction contract revenue was attributable to our North and West segments, respectively. Construction contract revenue is primarily made up of site-built and framing customers. The following table presents the balances of percentage-of-completion accounts on December 29, 2018 and December 30, 2017 which are included in other current assets and other accrued liabilities, respectively (in thousands): December 29, December 30, 2018 2017 Cost and Earnings in Excess of Billings $ 6,945 $ 5,005 Billings in Excess of Cost and Earnings 3,245 4,435 SHIPPING AND HANDLING OF PRODUCT Shipping and handling costs that are charged to and reimbursed by the customer are recognized as revenue. Costs incurred related to the shipment and handling of products are classified in cost of goods sold. EARNINGS PER SHARE The computation of earnings per share (“EPS”) is as follows (in thousands), which incorporate the retroactive effect of the Company’s 3 for 1 stock split: December 29, December 30, December 31, 2018 2017 2016 Numerator: Net earnings attributable to controlling interest $ 148,598 $ 119,512 $ 101,179 Adjustment for earnings allocated to non-vested restricted common stock (3,396) (2,225) (1,595) Net earnings for calculating EPS $ 145,202 $ 117,287 $ 99,584 Denominator: Weighted average shares outstanding 61,762 61,416 61,089 Adjustment for non-vested restricted common stock (1,411) (1,143) (963) Shares for calculating basic EPS 60,351 60,273 60,126 Effect of dilutive restricted common stock 82 90 99 Shares for calculating diluted EPS 60,433 60,363 60,225 Net earnings per share: Basic $ 2.41 $ 1.95 $ 1.66 Diluted $ 2.40 $ 1.94 $ 1.65 No options were excluded from the computation of diluted EPS for 2018, 2017, or 2016. USE OF ACCOUNTING ESTIMATES The preparation of financial statements in conformity with accounting principles generally accepted in the United States requires us to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements as well as the reported amounts of revenues and expenses during the reporting period. We believe our estimates to be reasonable; however, actual results could differ from these estimates. |
FAIR VALUE
FAIR VALUE | 12 Months Ended |
Dec. 29, 2018 | |
FAIR VALUE | |
FAIR VALUE | B. FAIR VALUE We apply the provisions of ASC 820, Fair Value Measurements and Disclosures, to assets and liabilities measured at fair value. Assets and liabilities measured at fair value are as follows: December 29, 2018 December 30, 2017 Quoted Prices with Quoted Prices with Prices in Other Prices with Prices in Other Active Observable Unobservable Active Observable Markets Inputs Inputs Markets Inputs (in thousands) (Level 1) (Level 2) (Level 3) Total (Level 1) (Level 2) Total Money market funds $ 56 $ 5,267 $ — $ 5,323 $ 64 $ 3,071 $ 3,135 Fixed income funds 3,387 9,738 — 13,125 1,182 6,974 8,156 Equity securities 7,262 — — 7,262 10,710 — 10,710 Hedge funds — — 1,756 1,756 Mutual funds: Domestic stock funds 2,846 — — 2,846 367 — 367 International stock funds 937 — — 937 91 — 91 Target funds 237 — — 237 270 — 270 Bond funds 796 — — 796 209 — 209 Alternative funds 1,318 — — 1,318 Total mutual funds 6,134 — — 6,134 937 — 937 Total $ 16,839 $ 15,005 1,756 $ 33,600 $ 12,893 $ 10,045 $ 22,938 Assets at fair value $ 16,839 $ 15,005 1,756 $ 33,600 $ 12,893 $ 10,045 $ 22,938 We maintain money market, mutual funds, bonds, and/or stocks in our non-qualified deferred compensation plan and our wholly owned licensed captive insurance company. These funds are valued at prices quoted in an active exchange market and are included in "Cash and Cash Equivalents", "Investments", and "Other Assets". We have elected not to apply the fair value option under ASC 825, Financial Instruments, to any of our financial instruments except for those expressly required by U.S. GAAP. The valuations of the Level 2 assets or liabilities rely on quoted prices in markets that are not active or observable inputs over the full term of the asset or liability. During 2018, we purchased a private real estate income trust which will be valued as a Level 3 asset. We did not maintain any Level 3 assets or liabilities at December 30, 2017. In 2017, our wholly-owned captive, Ardellis Insurance Ltd. (“Ardellis”) transferred fixed income securities to a newly formed collateral trust account in line with regulatory requirements in the State of Michigan to allow Ardellis to act as an admitted carrier in the State. These funds are intended to safeguard the insureds of the Michigan Branch of Ardellis. The funds are classified as “Restricted Investments”. In accordance with our investment policy, our wholly-owned company, Ardellis Insurance Ltd. ("Ardellis"), maintains an investment portfolio, totaling $27.4 million as of December 29, 2018, consisting of mutual funds, domestic and international stocks, and fixed income bonds. Ardellis’ available for sale investment portfolio consists of the following: December 29,2018 December 30,2017 Unrealized Unrealized Cost Gain/(Loss) Fair Value Cost Gain/(Loss) Fair Value Fixed Income $ 13,301 $ (176) $ 13,125 $ 8,170 $ (14) $ 8,156 Equity 7,141 121 7,262 9,185 1,524 10,709 Mutual Funds 5,815 (567) 5,248 — — — Hedge Funds 1,722 34 1,756 — — — Total $ 27,979 $ (588) $ 27,391 $ 17,355 $ 1,510 $ 18,865 Our fixed income investments consist of a blend of US Government and Agency bonds and investment grade corporate bonds with varying maturities. Our equity investments consist of small, mid, and large cap growth and value funds, as well as international equity. Our hedge funds consist of the private real estate income trust which is valued as a Level 3 asset. The net pre-tax unrealized loss was $0.5 million. Carrying amounts above are recorded in the investments and restricted investments line items within the balance sheet as of December 29, 2018. |
BUSINESS COMBINATIONS
BUSINESS COMBINATIONS | 12 Months Ended |
Dec. 29, 2018 | |
BUSINESS COMBINATIONS | |
BUSINESS COMBINATIONS | C. BUSINESS COMBINATIONS We completed the following business combinations in fiscal 2018 and 2017, which were accounted for using the purchase method (in thousands). Net Company Acquisition Intangible Tangible Operating Name Date Purchase Price Assets Assets Segment October 22, 2018 $15,115 $ 8,592 $ 6,523 North Pak-Rite, LTD ("Pak-Rite") A designer and manufacturer of packaging for high-value products, such as medical, aerospace and automation equipment. Pak-Rite had annual sales of approximately $15 million. The acquisition of Pak-Rite allows us to grow our portfolio of packaging products and our presence in this region. July 31, 2018 $1,016 $ 250 $ 766 West The Pallet Place, LLC ("Pallet Place") A manufacturer and distributor of total packaging solutions in timber, crates, skids, and pallets. Pallet Place had annual sales of approximately $5 million. The acquisition of Pallet Place allows us to increase our industrial business and creates operating leverage by consolidating with another regional operation. June 1, 2018 $23,866 $ 12,497 $ 11,369 South North American Container Corporation ("NACC") A manufacturer of structural packaging products, including steel, corrugated and hardwood packaging. NACC had annual sales of approximately $71 million. The acquisition of NACC allows us to enhance our presence in this region, expand our product offering, and serve customers more cost effectively. April 9, 2018 $3,890 $ 2,235 $ 1,655 West Fontana Wood Products ("Fontana") A manufacturer and distributor of lumber and trusses in the Southern California region. Fontana had annual sales of approximately $12 million. The acquisition of Fontana allows us to expand our manufactured housing business and creates operating leverage by consolidating with another regional operation. April 3, 2018 $1,347 $ 1,287 $ 60 All Other Expert Packaging ("Expert") A manufacturer and distributor of total packaging solutions in timber, crates, pallets, and skids. Expert had annual sales of approximately $3.6 million. The acquisition of Expert allows us to make progress on our goal of becoming a global provider of packaging solutions. January 23, 2018 $2,942 $ 850 $ 2,092 West Spinner Wood Products, LLC ("Spinner") A manufacturer and distributor of agricultural bin and various industrial packaging. Spinner had annual sales of approximately $8 million. The acquisition of Spinner allows us to expand our industrial packaging product offering and creates operating leverage by consolidating with other regional operations. January 15, 2018 $5,784 $ 50 $ 5,734 North Great Northern Lumber, LLC A manufacturer of industrial products as well as serving the concrete forming market in the Chicago area. Great Northern Lumber had annual sales of approximately $25 million. The acquisition of Great Northern Lumber enables us to expand our concrete forming product offering and regional coverage. October 16, 2017 $931 $ 909 $ 22 All Other Silverwater Box A manufacturer and distributor of total packaging solutions in timber, plastic, steel, fiberglass, and cardboard. Silverwater Box has annual sales of approximately $2.8 million. The acquisition of Silverwater Box allows us to make progress on our goal of becoming a global provider of packaging solutions. May 26, 2017 $5,042 $ 4,880 $ 162 South Go Boy Pallets, LLC ("Go Boy") A manufacturer and distributor of industrial pallets and packaging in Georgia and North Carolina. Go Boy has annual sales of approximately $8 million. The acquisition of Go Boy enabled us to expand our industrial packaging product offering and lumber sourcing in this region. March 6, 2017 $31,818 $ 7,653 $ 24,165 South Robbins Manufacturing Co. ("Robbins") A manufacturer of treated wood products with facilities in Florida, Georgia, and North Carolina. Robbins has annual sales of approximately $86 million. The acquisition of Robbins allowed us to expand our presence in this region and serve customers more cost effectively. March 6, 2017 $22,789 $ 14,341 $ 8,448 North Quality Hardwood Sales, LLC ("Quality") A manufacturer and supplier of hardwood products, including components of cabinets used in homes and recreational vehicles. Quality has annual sales of approximately $30 million. The acquisition of Quality enabled us to expand our product offering to include hardwood-based products. The intangible assets for each acquisition were finalized and allocated to their respective identifiable intangible asset and goodwill accounts during 2018, except for our NACC and Pak-Rite acquisitions. In aggregate, acquisitions not consolidated with other operations contributed approximately $110.1 million in revenue and a $1.1 million in operating profit during 2018. At December 29, 2018, the amounts assigned to major intangible classes for the business combinations mentioned above are as follows (in thousands): Non- Goodwill - Compete Customer Tax Agreements Relationships Tradename Goodwill Deductible Pak-Rite $ — $ 4,300 * $ — $ 4,292 * $ 8,592 Pallet Place — 250 — — 250 NACC — 3,500 * — 8,997 * 12,497 Fontana — 2,235 — — 2,235 Expert Packaging 221 809 257 — — Spinner 850 — — — 850 Great Northern Lumber 50 — — — 50 Silverwater Box — — — 909 — Go Boy 225 4,655 — — 4,880 Robbins 560 3,530 450 3,113 7,653 Quality 830 5,720 400 7,391 14,341 *(estimate) The business combinations mentioned above were not significant to our operating results individually or in aggregate, and thus pro forma results for 2018 and 2017 are not presented. |
GOODWILL AND OTHER INTANGIBLE A
GOODWILL AND OTHER INTANGIBLE ASSETS | 12 Months Ended |
Dec. 29, 2018 | |
GOODWILL AND OTHER INTANGIBLE ASSETS | |
GOODWILL AND OTHER INTANGIBLE ASSETS | D . GOODWILL AND OTHER INTANGIBLE ASSETS The changes in the net carrying amount of goodwill by reporting segment for the years ended December 29, 2018 and December 30, 2017, are as follows (in thousands): North South West All Other Total Balance as of December 31, 2016 43,386 43,625 87,730 23,794 198,535 2017 Acquisitions 7,391 3,113 — 909 11,413 Foreign Exchange, Net 350 — — 2,346 2,696 Balance as of December 30, 2017 51,127 46,738 87,730 27,049 212,644 2018 Acquisitions 4,292 8,996 — — 13,288 Foreign Exchange, Net (365) — — (1,450) (1,815) Balance as of December 29, 2018 $ 55,054 $ 55,734 $ 87,730 $ 25,599 $ 224,117 Indefinite-lived intangible assets totaled $ 7.4 million as of December 29, 2018 and December 30, 2017 related to the idX, International, and Consumer Products reporting units which is included in the All Other reportable segment. The following amounts were included in other amortizable intangible assets, net as of December 29, 2018 and December 30, 2017 (in thousands): 2018 2017 Accumulated Accumulated Assets Amortization Assets Amortization Non-compete agreements $ 10,232 $ (5,517) $ 9,841 $ (4,208) Customer relationships 40,307 (6,843) 31,630 (5,986) Licensing agreements 4,589 (3,909) 4,589 (3,450) Patents 792 (284) 792 (254) Tradename 2,879 (760) 2,420 (464) Total $ 58,799 $ (17,313) $ 49,272 $ (14,362) Amortization is computed principally by the straight-line method over the estimated useful lives of the intangible assets as follows: Weighted Average Intangible Asset Type Estimated Useful Life Amortization Period Non-compete agreements 3 to 15 years 6.8 years Customer relationship 5 to 15 years 11.4 years Licensing agreements 10 years 10 years Tradename (amortizable) 5 to 15 years 11.7 years Amortization expense of intangibles totaled $6.4 million, $4.9 million and $2.8 million in 2018, 2017 and 2016, respectively. The estimated amortization expense for intangibles for each of the five succeeding fiscal years is as follows (in thousands): 2019 $ 6,908 2020 5,802 2021 5,503 2022 5,119 2023 3,800 Thereafter 14,354 Total $ 41,486 |
DEBT
DEBT | 12 Months Ended |
Dec. 29, 2018 | |
DEBT | |
DEBT | E. DEBT On June 14, 2018, we entered into an unsecured Note Purchase Agreement (the "Agreement") under which we issued our 4.20% Series 2018 C Senior Notes, due June 14, 2028, in the aggregate principal amount of $40 million and our 4.27% Series 2018 D Senior Notes, due June 14, 2030, in the aggregate principal amount of $35 million. Proceeds from the sale of the Series C Senior Notes and Series D Senior Notes were used to pay down our revolving credit facility. On December 17, 2012, we entered into an unsecured Note Purchase Agreement (the "Agreement") under which we issued our 3.89% Series 2012 A Senior Notes, due December 17, 2022, in the aggregate principal amount of $35 million and our 3.98% Series 2012 B Senior Notes, due December 17, 2024, in the aggregate principal amount of $40 million. Proceeds from the sale of the Series A Senior Notes and Series B Senior Notes were used to repay amounts due on our existing Series 2002‑A Senior Notes, Tranche B totaling $40 million and our revolving credit facility. On November 1, 2018, we entered into a five-year, $375 million unsecured revolving credit facility with a syndicate of U.S. banks led by JPMorgan Chase Bank, N.A., as administrative agent and Wells Fargo Bank, N.A., as syndication agent. The facilities include up to $40 million which may be advanced in the form of letters of credit, and up to $100 million (U.S. dollar equivalent) which may be advanced in Canadian dollars, Australian dollars, pounds Sterling, Euros and such other foreign currencies as may subsequently be agreed upon among the parties. This facility replaced our $295 million unsecured revolving credit facility. Cash borrowings are charged interest based upon an index selected by the Company, plus a margin that is determined based upon the index selected and upon the financial performance of the Company and certain of its subsidiaries. The Company is charged a facility fee on the entire amount of the lending commitment, at a per annum rate ranging from 12.5 to 30.0 basis points, also determined based upon the Company’s performance. The facility fee is payable quarterly in arrears. Outstanding letters of credit extended on our behalf on December 29, 2018 and December 30, 2017 aggregated $30.3 million and $26.5 million; respectively, which includes approximately $9.8 million related to industrial development revenue bonds. The Company had an outstandi ng balance of $42.5 million and $59.4 million on its revolver at December 29, 2018, and December 30, 2017, respectively . After considering letters of credit, the Company had $322.7 million and $225.7 million in remaining availability on its revolver on December 29, 2018, and December 30, 2017, respectively. Additionally, we have $150 million in availability under a "shelf agreement" for long term debt with a current lender. Letters of credit have one year terms and include an automatic renewal clause. The letters of credit related to industrial development revenue bonds are charged an annual interest rate of 112.5 basis points, based upon our financial performance. The letters of credit related to workers’ compensation are charged an annual interest rate of 75 basis points. Long-term debt obligations are summarized as follows on December 29, 2018 and December 31, 2017 (amounts in thousands): 2018 2017 Series 2018 Senior Notes C, due on June 14, 2028, interest payable semi-annually at 4.20% $ 40,000 $ — Series 2018 Senior Notes D, due on June 14, 2030, interest payable semi-annually at 4.27% 35,000 — Series 2012 Senior Notes Tranche A, due on December 17, 2022, interest payable semi-annually at 3.89% 35,000 35,000 Series 2012 Senior Notes Tranche B, due on December 17, 2024, interest payable semi-annually at 3.98% 40,000 40,000 Revolving credit facility totaling $375 million due on November 1, 2023, interest payable monthly at a floating rate (3.39% on December 29, 2018 and 2.41% on December 30, 2017) 42,490 59,422 Series 1999 Industrial Development Revenue Bonds, due on August 1, 2029, interest payable monthly at a floating rate (1.94% on December 29, 2018 and 1.08% on December 30, 2017) 3,300 3,300 Series 2000 Industrial Development Revenue Bonds, due on October 1, 2020, interest payable monthly at a floating rate (2.00% on December 29, 2018 and 1.14% on December 30, 2017) 2,700 2,700 Series 2002 Industrial Development Revenue Bonds, due on December 1, 2022, interest payable monthly at a floating rate (1.99% on December 29, 2018 and 1.13% on December 30, 2017) 3,700 3,700 Capital leases and foreign affiliate debt 311 2,058 202,501 146,180 Less current portion (148) (1,329) Less debt issuance costs (223) (177) Long-term portion $ 202,130 $ 144,674 Financial covenants on the unsecured revolving credit facility and unsecured notes include minimum interest coverage tests and a maximum leverage ratio. The agreements also restrict the amount of additional indebtedness we may incur and the amount of assets which may be sold among other industry standard covenants. We were within all of our lending requirements on December 29, 2018 and December 30, 2017. On December 29, 2018, the principal maturities of long-term debt and capital lease obligations are as follows (in thousands): 2019 $ 148 2020 2,834 2021 29 2022 38,700 2023 42,490 Thereafter 118,300 Total $ 202,501 On December 29, 2018, the estimated fair value of our long-term debt, including the current portion, was $203.1 million, which was $0.6 million more than the carrying value. The estimated fair value is based on rates anticipated to be available to us for debt with similar terms and maturities. We consider the valuations of our long-term debt, including the current portion, to be Level 2 liabilities which rely on quoted prices in markets that are not active or observable inputs over the full term of the liability. |
LEASES
LEASES | 12 Months Ended |
Dec. 29, 2018 | |
LEASES | |
LEASES | F. LEASES We lease certain real estate under operating lease agreements with original terms ranging from one to ten years. We are required to pay real estate taxes and other occupancy costs under these leases. Certain leases carry renewal options of five to fifteen years. We also lease motor vehicles, equipment, and an aircraft under operating lease agreements for periods of one to ten years. Future minimum payments under non-cancelable operating leases on December 29, 2018 are as follows (in thousands): Operating Leases 2019 $ 17,242 2020 11,969 2021 9,784 2022 8,346 2023 6,382 Thereafter 22,498 Total minimum lease payments $ 76,221 Rent expense was approximately $25.0 million, $22.3 million, and $10.5 million in 2018, 2017, and 2016, respectively. |
DEFERRED COMPENSATION
DEFERRED COMPENSATION | 12 Months Ended |
Dec. 29, 2018 | |
DEFERRED COMPENSATION | |
DEFERRED COMPENSATION | G. DEFERRED COMPENSATION We have a program whereby certain executives irrevocably elected to defer receipt of certain compensation in 1985 through 1988. Deferred compensation payments to these executives will commence upon their retirement. We purchased life insurance on these executives, payable to us in amounts which, if assumptions made as to mortality experience, policy dividends, and other factors are realized, will accumulate cash values adequate to reimburse us for all payments for insurance and deferred compensation obligations. In the event cash values are not sufficient to fund such obligations, the program allows us to reduce benefit payments to such amounts as may be funded by accumulated cash values. The deferred compensation liabilities and related cash surrender value of life insurance policies totaled $2.0 million on December 29, 2018 and December 30, 2017, and are included in "Other Liabilities" and "Other Assets," respectively. We also maintain a non-qualified deferred compensation plan (the "Plan") for the benefit of senior management employees who may elect to defer a portion of their annual bonus payments and salaries. The Plan provides investment options similar to our 401(k) plan, including our stock. The investment in our stock is funded by the issuance of shares to a Rabbi trust, and may only be distributed in kind. Assets held by the Plan totaled approximately $ 1.0 million on December 29, 2018 and December 30, 2017, and are included in "Other Assets." Related liabilities totaled $ 27.8 million and $22.6 million on December 29, 2018 and December 30, 2017, respectively, and are included in "Other Liabilities" and "Shareholders’ Equity." Assets associated with the Plan are recorded at fair market value. The related liabilities are recorded at fair market value, with the exception of obligations associated with investments in our stock which are recorded at the market value on the date of deferral. |
COMMON STOCK
COMMON STOCK | 12 Months Ended |
Dec. 29, 2018 | |
COMMON STOCK | |
COMMON STOCK | H. COMMON STOCK We maintain and administer our shareholder approved Employee Stock Purchase Plan ("Stock Purchase Plan"). The Stock Purchase Plan allows eligible employees to purchase shares of our stock at a share price equal to 85% of fair market value on the purchase date. We have expensed the fair value of the compensation associated with these awards, which approximates the discount. The amount of expense is nominal. We maintain and administer our shareholder approved Directors’ Retainer Stock Plan ("Stock Retainer Plan"). The Stock Retainer Plan allows eligible members of the Board of Directors to defer the cash portion of their retainer and committee fees and receive shares of our stock at the time of or following their retirement, disability or death. The number of shares to be received is equal to the amount of the cash portion of their retainer and committee fees deferred multiplied by 110%, divided by the fair market value of a share of our stock at the time of deferral. The number of shares is increased by the amount of dividends paid on the Company’s common stock. We recognized expense for this plan of $1.7 million in 2018, $1.7 million in 2017, and $0.7 million in 2016. Effective January 1, 2017, this plan was amended to allow directors to defer payment of the annual retainer paid in the form of our common stock. Finally, we maintain and administer our shareholder approved Long Term Stock Incentive Plan (the "LTSIP”). The LTSIP provides for the grant of stock options, stock appreciation rights, restricted stock, performance shares and other stock-based awards. On October 18, 2017, the Board of Directors approved a three-for-one split of the Company's outstanding shares of common stock effected as a stock dividend. On November 14, 2017, shareholders of record as of October 31, 2017, received two additional shares for each share held on the record date. There is no unrecognized compensation expense remaining for stock options in 2018, 2017, and 2016. Below is a summary of common stock issuances for 2018 and 2017: December 29, 2018 Share Issuance Activity Common Stock Average Share Price Shares issued under the employee stock purchase plan 38 $ 35.58 Shares issued under the employee stock gift program 3 33.56 Shares issued under the director retainer stock program 101 17.17 Shares issued under the long term stock incentive plan 164 35.16 Shares issued under the executive stock match grants 94 32.94 Forfeitures (14) - Total shares issued under stock grant programs 348 $ 29.37 Shares issued under the deferred compensation plans 167 $ 36.98 December 30, 2017 Share Issuance Activity Common Stock Average Share Price Shares issued under the employee stock purchase plan 24 $ 32.80 Shares issued under the employee stock gift program 3 31.92 Shares issued under the director retainer stock program 62 19.02 Shares issued under the long term stock incentive plan 240 31.81 Shares issued under the executive stock match grants 129 32.03 Forfeitures (5) - Total shares issued under stock grant programs 429 $ 30.06 Shares issued under the deferred compensation plans 159 $ 32.16 A summary of the nonvested restricted stock awards granted under the LTSIP is as follows: Weighted- Unrecognized Average Weighted- Compensation Period to Restricted Average Grant Expense Recognize Awards Date Fair Value (in millions) Expense Nonvested at December 26, 2015 623,748 13.66 5.2 2.53 years Granted 350,892 23.96 Vested (180,465) 15.66 Forfeited (2,643) 21.45 Nonvested at December 31, 2016 791,532 19.32 4.8 1.51 years Granted 388,248 32.03 Vested (141,111) 12.71 Forfeited (5,043) 30.14 Nonvested at December 30, 2017 1,033,626 24.24 7.1 1.31 years Granted 247,068 36.52 Vested (107,865) 18.11 Forfeited (12,750) 24.19 Nonvested at December 29, 2018 1,160,079 $ 23.32 $ 7.6 1.12 years Under the Stock Purchase Plan and LTSIP, we recognized share-based compensation expense of $3.6 million, $3.6 million, and $2.2 million and the related total income tax benefits of $0.7 million, $1.0 million, and $1.1 million in 2018, 2017 and 2016, respectively. In 2018, 2017 and 2016, cash received from share issuances under our plans was $1.0 million, $ 0.7 million and $0.5 million, respectively. On November 14, 2001, the Board of Directors approved a share repurchase program (which succeeded a previous program) allowing us to repurchase up to 2.5 million shares of our common stock. On October 14, 2010, our Board authorized an additional 2 million shares to be repurchased under our share repurchase program. We repurchased 860,669 and 445,740 shares under this program in 2018 and 2017, respectively. As of December 29, 2018, the cumulative total authorized shares available for repurchase is approximately 1.9 million shares. |
RETIREMENT PLANS
RETIREMENT PLANS | 12 Months Ended |
Dec. 29, 2018 | |
RETIREMENT PLANS | |
RETIREMENT PLANS | I. RETIREMENT PLANS We have a profit sharing and 401(k) plan for the benefit of substantially all of our employees, excluding the employees of certain wholly-owned subsidiaries. Amounts contributed to the plan are made at the discretion of the Board of Directors. We matched 25% of employee contributions in 2018, 2017, and 2016, on a discretionary basis, totaling $3.4 million, $ 4.8 million, and $4.4 million respectively. The basis for matching contributions may not exceed the lesser of 6% of the employee’s annual compensation or the IRS limitation. On July 14, 2011, the compensation committee of the board of directors approved a retirement plan for certain officers of the Company (who have at least 20 years of service with the Company and at least 10 years of service as an officer) whereby we will pay, upon retirement, benefits totaling 150% of the officer’s highest base salary in the three years immediately preceding separation from service plus health care benefits for a specified period of time if certain eligibility requirements are met. Approximately $9.1 million and $7.8 million are accrued in “Other Liabilities” for this plan at December 29, 2018 and December 30, 2017, respectively. |
INCOME TAXES
INCOME TAXES | 12 Months Ended |
Dec. 29, 2018 | |
INCOME TAXES | |
INCOME TAXES | J. INCOME TAXES Income tax provisions for the years ended December 29, 2018, December 30, 2017, and December 31, 2016 are summarized as follows (in thousands): 2018 2017 2016 Currently Payable: Federal $ 31,492 $ 44,413 $ 42,397 State and local 7,544 8,579 6,341 Foreign 5,527 6,240 6,143 44,563 59,232 54,881 Net Deferred: Federal 2,965 (7,681) (455) State and local (522) (864) 438 Foreign (1,565) 1,280 310 878 (7,265) 293 $ 45,441 $ 51,967 $ 55,174 The components of earnings before income taxes consist of the following: 2018 2017 2016 U.S. $ 180,261 $ 151,395 $ 140,106 Foreign 17,592 24,612 20,565 Total $ 197,853 $ 176,007 $ 160,671 The effective income tax rates are different from the statutory federal income tax rates for the following reasons: 2018 2017 2016 Statutory federal income tax rate 21.0 % 35.0 % 35.0 % State and local taxes (net of federal benefits) 3.8 3.0 3.1 Effect of noncontrolling owned interest in earnings of partnerships (0.1) (0.2) (0.2) Manufacturing deduction n/a (2.5) (2.4) Tax credits, including foreign tax credit (1.6) (2.0) (1.4) Change in uncertain tax positions reserve 0.1 0.4 0.4 Other permanent differences 0.6 (0.1) 0.1 Other, net (0.7) (0.6) (0.3) Impact of Tax Act and reduction of corporate tax rate (0.1) (3.5) — Effective income tax rate 23.0 % 29.5 % 34.3 % Temporary differences which give rise to deferred income tax assets and (liabilities) on December 29, 2018 and December 30, 2017 are as follows (in thousands): 2018 2017 Employee benefits $ 20,914 $ 17,048 Net operating loss carryforwards 6,520 8,592 Foreign subsidiary capital loss carryforward 504 546 Other tax credits 586 709 Inventory 1,090 358 Reserves on receivables 802 714 Accrued expenses 1,593 2,060 Other, net 2,785 1,879 Gross deferred income tax assets 34,794 31,906 Valuation allowance (2,707) (4,706) Deferred income tax assets 32,087 27,200 Depreciation (24,881) (19,992) Intangibles (20,225) (19,422) Other, net — — Deferred income tax liabilities (45,106) (39,414) Net deferred income tax liability $ (13,019) $ (12,214) As of December 29, 2018, the company had federal, state and foreign net operating loss carryforwards of $6.5 million and state tax credit carryforwards of $0.4 million, which will expire at various dates. The NOL and credit carryforwards expire as follows: Net Operating Losses Tax Credits U.S. State Foreign U.S. State 2018 – 2022 $ — $ 165 $ 347 $ — $ 381 2023 - 2027 — 526 635 — — 2028 - 2032 2,859 672 114 — — 2033 - 2037 41 812 — — — Thereafter — 293 56 — — Total $ 2,900 $ 2,468 $ 1,152 $ — $ 381 As of December 29, 2018, we believe that it is more likely than not that the benefit from certain state and foreign NOL carryforwards as well as certain state tax credit carryforwards will not be realized. In recognition of this risk, we have provided a valuation allowance against various NOL and tax credit carryforwards. Furthermore, there is a valuation allowance of $0.5 million against a capital loss carryforward we have for a wholly-owned subsidiary, UFP Canada, Inc. Based upon the business activity and the nature of the assets of this subsidiary, our ability to realize a future benefit from this carryforward is doubtful. The capital loss has an unlimited carryforward and therefore will not expire unless there is a change in control of the subsidiary. On December 22, 2017, the U.S. government enacted comprehensive tax legislation commonly referred to as the Tax Cuts and Jobs Act (the ”Tax Act”). The Tax Act makes broad and complex changes to the U.S. tax code that affected 2017, including, but not limited to, (1) requiring a one-time transition tax on certain unrepatriated earnings of foreign subsidiaries that is payable over eight years and (2) bonus depreciation that will allow for full expensing of qualified property. The Tax Act also established new tax laws that will affect 2018, including, but not limited to, (1) reduction of the U.S. federal corporate tax rate; (2) elimination of the corporate alternative minimum tax (AMT); (3) the creation of the base erosion anti-abuse tax (BEAT), a new minimum tax: (4) a general elimination of U.S. federal income taxes on dividends from foreign subsidiaries; (5) a new provision designed to tax global intangible low-taxed income (GILTI), which allows for the possibility of using foreign tax credits (FTCs) and a deduction of up to 50 percent to offset the income tax liability (subject to some limitations); (6) a new limitation on deductible interest expense; (7) the repeal of the domestic production activity deduction; (8) limitations on the deductibility of certain executive compensation; (9) limitations on the use of FTCs to reduce the U.S. income tax liability; and (10) limitations on net operating losses (NOLs) generated after December 31, 2017, to 80 percent of taxable income. The SEC staff issued SAB 118, which provides guidance on accounting for the tax effects of the Tax Act. SAB 118 provides a measurement period that should not extend beyond one year from the Tax Act enactment date for companies to complete the accounting under ASC 740. In accordance with SAB 118, a company must reflect the income tax effects of those aspects of the Act for which the accounting under ASC 740 is complete. To the extent that a company’s accounting for certain income tax effects of the Tax Act is incomplete but it is able to determine a reasonable estimate, it must record a provisional estimate in the financial statements. If a company cannot determine a provisional estimate to be included in the financial statements, it should continue to apply ASC 740 on the basis of the provisions of the tax laws that were in effect immediately before the enactment of the Tax Act. In connection with our initial analysis of the impact of the Tax Act, we recorded a provisional discrete net tax benefit of $6.1 million in the period ending December 30, 2017 which consisted primarily of (1) a net benefit for the corporate rate reduction of $8.2 million; (2) a net expenses for the write-down of deferred tax assets for stock based compensation that will no longer be deductible for $1.9 million; and (3) a net expense for the transition tax of $0.2 million. We completed our accounting for the income tax effects of the Tax Act in 2018 and have recognized an additional measurement-period adjustment of a net tax benefit of $0.3 million in the period ending December 29, 2018. The adjusted total impact of the Tax Act is now $6.4 million which consists of the following: (1) the net benefit for the corporate rate reduction remained the same at $8.2 million; (2) a net expense for the write-down of the deferred tax assets for stock based compensation was reduced by $0.1 million to $1.8 million, and (3) the net expense for the transition tax was eliminated and reduced by $0.2 million. The effect of the measurement-period adjustment on the 2018 effective tax rate was a reduction of approximately 0.1 percent. Global intangible low taxed income (GILTI): The Tax Act created a new requirement that certain income (i.e., GILTI) earned by controlled foreign corporations (CFCs) must be included currently in the gross income of the CFCs’ U.S. shareholder. GILTI is the excess of the shareholder’s “net CFC tested income” over the net deemed tangible income return, which is currently defined as the excess of (1) 10 percent of the aggregate of the U.S. shareholder’s pro rata share of the qualified business asset investment of each CFC with respect to which it is a U.S. shareholder over (2) the amount of certain interest expense taken into account in the determination of net CFC-tested income. In our evaluation of this provision of the Tax Act and the application of ASC 740, we elected under U.S. GAAP, to make the accounting policy of treating taxes due on future U.S. inclusions in taxable income related to GILTI as a current-period expense when incurred (the “period cost method”) as opposed to factoring such amounts into a company’s measurement of its deferred taxes (the “deferred method”). For the year ended December 29, 2018, we determined that no GILTI tax inclusion was applicable. |
ACCOUNTING FOR UNCERTAINTY IN I
ACCOUNTING FOR UNCERTAINTY IN INCOME TAXES | 12 Months Ended |
Dec. 29, 2018 | |
ACCOUNTING FOR UNCERTAINTY IN INCOME TAXES | |
ACCOUNTING FOR UNCERTAINTY IN INCOME TAXES | K. ACCOUNTING FOR UNCERTAINTY IN INCOME TAXES ASC 740, Income Taxes (“ASC 740”) clarifies the accounting for income taxes by prescribing the minimum recognition threshold a tax position is required to meet before being recognized in the financial statements. ASC 740 also provides guidance on derecognition, measurement, classification, interest and penalties, and disclosure requirements. A reconciliation of the beginning and ending amount of unrecognized tax benefits is as follows (in thousands): 2018 2017 2016 Gross unrecognized tax benefits beginning of year $ 4,000 $ 3,381 $ 2,209 Increase in tax positions for prior years (366) 4 243 Increase in tax positions due to acquisitions — — 362 Increase in tax positions for current year 1,326 1,107 905 Settlements with taxing authorities — (2) (32) Lapse in statute of limitations (582) (490) (306) Gross unrecognized tax benefits end of year $ 4,378 $ 4,000 $ 3,381 Our effective tax rate would have been affected by the unrecognized tax benefits had this amount been recognized as a reduction to income tax expense. We recognized interest and penalties for unrecognized tax benefits in our provision for income taxes. The liability for unrecognized tax benefits included accrued interest and penalties of $0 .5 million, $0.7 million, and $0.6 million at December 29, 2018, December 30, 2017, and December 31, 2016, respectively. We file income tax returns in the United States and in various state, local and foreign jurisdictions. The federal and a majority of state and foreign jurisdictions are no longer subject to income tax examinations for years before 2015. A number of routine state and local examinations are currently ongoing. Due to the potential for resolution of state examinations, and the expiration of various statutes of limitation, and new positions that may be taken, it is reasonably possible that the amounts of unrecognized tax benefits could change in the next twelve months is $0.8 million. |
COMMITMENTS, CONTINGENCIES, AND
COMMITMENTS, CONTINGENCIES, AND GUARANTEES | 12 Months Ended |
Dec. 29, 2018 | |
COMMITMENTS, CONTINGENCIES, AND GUARANTEES | |
COMMITMENTS, CONTINGENCIES, AND GUARANTEES | L. COMMITMENTS, CONTINGENCIES, AND GUARANTEES We are self-insured for environmental impairment liability, including certain liabilities which are insured through a wholly owned subsidiary, Ardellis Insurance Ltd., a licensed captive insurance company. We own and operate a number of facilities throughout the United States that chemically treat lumber products. In connection with the ownership and operation of these and other real properties, and the disposal or treatment of hazardous or toxic substances, we may, under various federal, state, and local environmental laws, ordinances, and regulations, be potentially liable for removal and remediation costs, as well as other potential costs, damages, and expenses. Environmental reserves, calculated with no discount rate, have been established to cover remediation activities at wood preservation facilities in Stockertown, PA; Elizabeth City, NC; and Auburndale, FL. In addition, a reserve was established for our facility in Thornton, CA to remove certain lead containing materials which existed on the property at the time of purchase. On a consolidated basis, we have reserved approximately $2.1 million and $3.0 million on December 29, 2018 and December 30, 2017, respectively, representing the estimated costs to complete future remediation efforts. These amounts have not been reduced by an insurance receivable. Many of our wood treating operations utilize “Subpart W” drip pads, defined as hazardous waste management units by the Environmental Protection Agency. The rules regulating drip pads require that a pad be “closed” at the point that it is no longer intended to be used for wood treating operations or to manage hazardous waste. Closure involves identification and disposal of contaminants which are required to be removed from the facility. The cost of closure is dependent upon a number of factors including, but not limited to, identification and removal of contaminants, cleanup standards that vary from state to state, and the time period over which the cleanup would be completed. Based on our present knowledge of existing circumstances, it is considered probable that these costs will approximat e $0.1 million. As a result, this amount is recorded in other long-term liabilities on December 29, 2018. In addition, on December 29, 2018, we were parties either as plaintiff or defendant to a number of lawsuits and claims arising through the normal course of our business. In the opinion of management, our consolidated financial statements will not be materially affected by the outcome of these contingencies and claims. On December 29, 2018, we had outstanding purchase commitments on commenced capital projects of approximately $14.3 million. We provide a variety of warranties for products we manufacture. Historically, warranty claims have not been material. We distribute products manufactured by other companies, some of which are no longer in business. While we do not warrant these products, we have received claims as a distributor of these products when the manufacturer no longer exists or has the ability to pay. Historically, these costs have not had a material affect on our consolidated financial statements. As part of our operations, we supply building materials and labor to site-built construction projects or we jointly bid on contracts with framing companies for such projects. In some instances we are required to post payment and performance bonds to insure the project owner that the products and installation services are completed in accordance with our contractual obligations. We have agreed to indemnify the surety for claims made against the bonds. As of December 29, 2018, we had approximately $21.1 million in outstanding payment and performance bonds for open projects. We had approximately $1.0 million in payment and performance bonds outstanding for completed projects which are still under warranty. On December 29, 2018 we had outstanding letters of credit totaling $30.3 million, primarily related to certain insurance contracts and industrial development revenue bonds described further below. In lieu of cash deposits, we provide irrevocable letters of credit in favor of our insurers to guarantee our performance under certain insurance contracts. We currently have irrevocable letters of credit outstanding totaling approximately $20.5 million for these types of insurance arrangements. We have reserves recorded on our balance sheet, in accrued liabilities, that reflect our expected future liabilities under these insurance arrangements. We are required to provide irrevocable letters of credit in favor of the bond trustees for all industrial development revenue bonds that have been issued. These letters of credit guarantee principal and interest payments to the bondholders. We currently have irrevocable letters of credit outstanding totaling approximately $9.8 million related to our outstanding industrial development revenue bonds. These letters of credit have varying terms but may be renewed at the option of the issuing banks. Certain wholly owned domestic subsidiaries have guaranteed the indebtedness of Universal Forest Products, Inc. in certain debt agreements, including the Series 2012 Senior Notes, the Series 2018 Senior Notes, and our revolving credit facility. The maximum exposure of these guarantees is limited to the indebtedness outstanding under these debt arrangements and this exposure will expire concurrent with the expiration of the debt agreements. We did not enter into any new guarantee arrangements during 2018 which would require us to recognize a liability on our balance sheet. |
SEGMENT REPORTING
SEGMENT REPORTING | 12 Months Ended |
Dec. 29, 2018 | |
SEGMENT REPORTING | |
SEGMENT REPORTING | M. SEGMENT REPORTING ASC 280, Segment Reporting (“ASC 280”), defines operating segments as components of an enterprise about which separate financial information is available that is evaluated regularly by the chief operating decision maker in deciding how to allocate resources and in assessing performance. The Company operates manufacturing, treating and distribution facilities throughout North America, Europe, Asia and Australia, but primarily in the United States. The Company manages the operations of its individual locations primarily through a geographic reporting structure under which each location is included in a region and regions are included in our North, South, West, and International divisions. The exceptions to this geographic reporting and management structure are (a) the Company’s Alternative Materials Division, which offers a portfolio of non-wood products and distributes those products nation-wide and is accounted for as a reporting unit within the All Other segment, (b) the Company’s distribution unit (referred to as UFPD) which distributes a variety of products to the manufactured housing industry and is accounted for as a reporting unit within the North segment, and (c) idX division, which designs, manufactures, and installs customized interior fixtures and is accounted for within the All Other segment. With respect to the facilities in the north, south, and west segments, these facilities generally supply the three markets the Company serves nationally - Retail, Industrial, and Construction. Also, substantially all of our facilities support customers in the immediate geographical region surrounding the facility. One customer, The Home Depot, accounted for approximately 19% of our total sales in fiscal 2018 and 2017, and 20% in 2016. Our Alternative Materials, International, and idX divisions have been included in the “All Other” column of the table below. The “Corporate” column includes unallocated administrative costs and certain incentive compensation expense. 2018 All North South West Other Corporate Total Net sales to outside customers $ 1,279,459 $ 1,024,747 $ 1,599,274 $ 585,700 $ — $ 4,489,180 Intersegment net sales 56,682 76,297 56,004 235,905 — 424,888 Interest expense (income) 58 (6) 197 (1,486) 10,130 8,893 Amortization expense 830 1,292 1,998 2,273 — 6,393 Depreciation expense 12,062 8,244 14,836 10,341 9,466 54,949 Segment earnings from operations 66,239 60,049 103,357 6,779 (29,161) 207,263 Segment assets 386,483 266,503 496,939 395,727 101,896 1,647,548 Capital expenditures 17,820 9,185 26,024 39,168 3,665 95,862 2017 All North South West Other Corporate Total Net sales to outside customers $ 1,133,656 $ 837,370 $ 1,417,924 $ 552,232 $ — $ 3,941,182 Intersegment net sales 67,161 74,566 83,245 167,568 — 392,540 Interest expense 4 160 293 (473) 6,234 6,218 Amortization expense 559 607 1,723 1,971 — 4,860 Depreciation expense 10,511 6,880 14,116 8,586 8,443 48,536 Segment earnings from operations 61,326 46,646 82,465 17,296 (26,264) 181,469 Segment assets 351,270 240,661 462,311 356,264 54,171 1,464,677 Capital expenditures 23,026 12,286 23,212 9,865 2,727 71,116 2016 All North South West Other Corporate Total Net sales to outside customers $ 1,000,426 $ 711,862 $ 1,251,093 $ 277,112 $ — $ 3,240,493 Intersegment net sales 57,770 38,641 88,311 19,322 — 204,044 Interest expense 1 307 387 143 3,737 4,575 Amortization expense 115 — 1,858 822 — 2,795 Depreciation expense 8,948 6,190 13,326 4,531 7,828 40,823 Segment earnings from operations 59,408 47,146 76,875 16,639 (35,630) 164,438 Segment assets 302,009 192,085 438,674 313,304 45,986 1,292,058 Capital expenditures 10,902 5,571 19,648 6,037 11,604 53,762 Information regarding principal geographic areas was as follows (in thousands): 2018 2017 2016 Long-Lived Long-Lived Long-Lived Tangible Tangible Tangible Net Sales Assets Net Sales Assets Net Sales Assets United States $ 4,382,356 $ 342,326 $ 3,821,366 $ 313,976 $ 3,162,331 $ 280,362 Foreign 106,824 34,312 119,816 30,380 78,162 26,106 Total $ 4,489,180 $ 376,638 $ 3,941,182 $ 344,356 $ 3,240,493 $ 306,468 Sales generated in Canada and Mexico are primarily to customers in the United States of America. The following table presents, for the periods indicated, our gross sales (in thousands) by major product classification. Year Ended December 29, December 30, December 31, 2018 2017 2016 Value-Added Sales Trusses – residential, modular and manufactured housing $ 421,996 $ 368,591 $ 334,956 Fencing 179,037 187,905 176,668 Decking and railing – composite, wood and other 271,499 244,910 200,004 Turn-key framing and installed sales 151,260 149,520 141,474 Industrial packaging and components 581,622 471,262 391,610 Engineered wood products (eg. LVL; i-joist) 83,212 76,507 76,503 In-store fixtures 252,341 260,174 87,262 Manufactured brite and other lumber 102,333 78,638 68,517 Wall panels 69,889 61,226 53,279 Outdoor DIY products (eg. stakes; landscape ties) 124,907 110,327 106,284 Construction and building materials (eg. door packages; drywall) 305,374 265,048 204,732 Lattice – plastic and wood 48,614 48,736 50,556 Manufactured brite and other panels 97,314 75,742 60,753 Siding, trim and moulding 98,370 85,016 66,048 Hardware 24,662 21,218 20,713 Manufactured treated lumber 20,889 17,584 17,412 Other 21,342 12,604 10,967 Total Value-Added Sales $ 2,854,661 $ 2,535,008 $ 2,067,738 Commodity-Based Sales Non-manufactured brite and other lumber 718,456 576,374 469,042 Non-manufactured treated lumber 647,222 575,505 479,333 Non-manufactured brite and other panels 285,888 271,310 238,806 Non-manufactured treated panels 39,768 34,970 30,374 Other 19,754 13,036 12,084 Total Commodity-Based Sales $ 1,711,088 $ 1,471,195 $ 1,229,639 Total Gross Sales $ 4,565,749 $ 4,006,203 $ 3,297,377 Sales allowances (76,569) (65,021) (56,884) Total Net Sales $ 4,489,180 $ 3,941,182 $ 3,240,493 |
QUARTERLY FINANCIAL INFORMATION
QUARTERLY FINANCIAL INFORMATION (UNAUDITED) | 12 Months Ended |
Dec. 29, 2018 | |
QUARTERLY FINANCIAL INFORMATION (UNAUDITED) | |
QUARTERLY FINANCIAL INFORMATION (UNAUDITED) | N. QUARTERLY FINANCIAL INFORMATION (UNAUDITED) The following table sets forth selected financial information for all of the quarters, consisting of 13 and 14 weeks during the years ended December 29, 2018 and December 30, 2017, respectively, (in thousands, except per share data): First Second Third Fourth 2018 2017 2018 2017 2018 2017 2018 2017 Net sales $ 993,857 $ 846,130 $ 1,294,440 $ 1,072,375 $ 1,212,702 $ 1,056,586 $ 988,179 $ 966,091 Gross profit 130,889 120,740 165,689 148,240 158,673 144,687 137,643 129,159 Net earnings 33,582 21,634 45,130 34,574 42,068 34,669 31,633 33,162 Net earnings attributable to controlling interest 32,833 21,062 44,044 33,642 41,219 33,693 30,502 31,115 Basic earnings per share 0.53 0.34 0.71 0.55 0.67 0.55 0.50 0.51 Diluted earnings per share 0.53 0.34 0.71 0.55 0.66 0.55 0.50 0.51 |
SUMMARY OF SIGNIFICANT ACCOUN_2
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 12 Months Ended |
Dec. 29, 2018 | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |
PRINCIPLES OF CONSOLIDATION | PRINCIPLES OF CONSOLIDATION The consolidated financial statements include our accounts and those of our wholly-owned and majority-owned subsidiaries and partnerships. In addition, we consolidate any entity which we own 50% or more and exercise control. Intercompany transactions and balances have been eliminated. |
NONCONTROLLING INTEREST IN SUBSIDIAIRIES | NONCONTROLLING INTEREST IN SUBSIDIARIES Noncontrolling interest in results of operations of consolidated subsidiaries represents the noncontrolling shareholders’ share of the income or loss of various consolidated subsidiaries. The noncontrolling interest reflects the original investment by these noncontrolling shareholders combined with their proportional share of the earnings or losses of these subsidiaries, net of distributions paid. |
FISCAL YEAR | FISCAL YEAR Our fiscal year is a 52 or 53 week period, ending on the last Saturday of December. Unless otherwise stated, references to 2018, 2017, and 2016 relate to the fiscal years ended December 29, 2018, December 30, 2017, and December 31, 2016, respectively. Fiscal year 2016 was comprised of 53 weeks, which contributed an additional $ 60 million in sales in 2016 compared to fiscal years 2018 and 2017, which were comprised of 52 weeks. |
FAIR VALUE DISCLOSURES OF FINANCIAL INSTRUMENTS | FAIR VALUE DISCLOSURES OF FINANCIAL INSTRUMENTS We follow ASC Topic 820, Fair Value Measurements and Disclosures , which provides a consistent definition of fair value, focuses on exit price, prioritizes the use of market-based inputs over entity-specific inputs for measuring fair value and establishes a three-tier hierarchy for fair value measurements. This topic requires fair value measurements to be classified and disclosed in one of the following three categories: · Level 1 — Financial instruments with unadjusted, quoted prices listed on active market exchanges. · Level 2 — Financial instruments lacking unadjusted, quoted prices from active market exchanges, including over-the-counter traded financial instruments. Financial instrument values are determined using prices for recently traded financial instruments with similar underlying terms and direct or indirect observational inputs, such as interest rates and yield curves at commonly quoted intervals. · Level 3 — Financial instruments not actively traded on a market exchange and there is little, if any, market activity. Values are determined using significant unobservable inputs or valuation techniques. |
CASH AND CASH EQUIVALENTS | CASH AND CASH EQUIVALENTS Cash and cash equivalents consist of cash and highly-liquid investments purchased with an original maturity of three months or less. In November 2016, the Financial Accounting Standards Board (FASB) issued Accounting Standard Update (ASU) No. 2016-18, “Statement of Cash Flows (Topic 230)” (ASU 2016-18). Under ASU 2016-18, an entity will be required to explain changes in the statement of cash flows during the period in the total of cash, cash equivalents, and amounts generally described as restricted cash or restricted cash equivalents. Therefore, amounts generally described as restricted cash and restricted cash equivalents should be included with cash and cash equivalents when reconciling the beginning-of-period and end-of-period total amounts shown on the statement of cash flows. The amendments in this update should be applied using retrospective transition method to each period presented. Companies are required to adopt the new standard for fiscal years beginning after December 15, 2017. Early adoption of ASU 2016-18 is permitted, including adoption in an interim period. The Company has early adopted this standard during the first quarter of 2017. |
INVESTMENTS | INVESTMENTS Investments are deemed to be "available for sale" and are, accordingly, carried at fair value being the quoted market value. In January 2016, the FASB issued ASU No. 2016-01, Recognition and Measurement of Financial Assets and Financial Liabilities, which amends ASC 825-10, Financial Instruments – Overall, this ASU changes the treatment for available-for-sale equity investments by recognizing unrealized fair value changes directly in net income and no longer in other comprehensive income. For public entities, the amendment is effective for fiscal years beginning after December 15, 2017. The ASU was adopted during fiscal 2018 with a cumulative-effect adjustment to retained earnings of $0.9 million at the beginning of 2018. The available-for-sale equity securities balance at December 29, 2018 is $10.7 million, which resulted in an unrealized loss recorded as a non-operating expense of $1.9 million. |
ACCOUNTS RECEIVABLE AND ALLOWANCES | ACCOUNTS RECEIVABLE AND ALLOWANCES We perform periodic credit evaluations of our customers and generally do not require collateral. Accounts receivable are due under a range of terms we offer to our customers. Discounts are offered, in most instances, as an incentive for early payment. We base our allowances related to receivables on historical credit and collections experience, and the specific identification of other potential problems, including the general economic climate. Actual collections can differ, requiring adjustments to the allowances. Individual accounts receivable balances are evaluated on a monthly basis, and those balances considered uncollectible are charged to the allowance. The following table presents the activity in our accounts receivable allowances (in thousands): Additions Charged to Beginning Costs and Ending Balance Expenses Deductions* Balance Year Ended December 29,2018: Allowance for possible losses on accounts receivable $ 2,424 $ 38,963 $ (38,786) $ 2,601 Year Ended December 30, 2017: Allowance for possible losses on accounts receivable $ 2,845 $ 28,102 $ (28,523) $ 2,424 Year Ended December 31, 2016: Allowance for possible losses on accounts receivable $ 2,672 $ 28,405 $ (28,232) $ 2,845 * We record estimated sales returns, discounts, and other applicable adjustments as a reduction of net sales in the same period revenue is recognized. Accounts receivable retainage amounts related to long term construction contracts totaled $5.5 million and $4.8 million as of December 29, 2018 and December 30, 2017, respectively. All amounts are expected to be collected within 18 months. Concentration of accounts receivable related to our largest customer totaled $44.5 million and $55.9 million as of December 29, 2018 and December 30, 2017, respectively. |
INVENTORIES | INVENTORIES Inventories are stated at the lower of cost or market. The cost of inventories includes raw materials, direct labor, and manufacturing overhead. Cost is determined on a weighted average basis. Raw materials consist primarily of unfinished wood products expected to be manufactured or treated prior to sale, while finished goods represent various manufactured and treated wood products ready for sale. We have inventory on consignment at customer locations valued at $16.8 million as of December 29, 2018 and $14.8 million as of December 30, 2017. |
PROPERTY, PLANT, AND EQUIPMENT | PROPERTY, PLANT, AND EQUIPMENT Property, plant, and equipment are stated at cost. Expenditures for renewals and betterments are capitalized, and maintenance and repairs are expensed as incurred. Amortization of assets held under capital leases is included in depreciation and amortized over the shorter of the estimated useful life of the asset or the lease term. Depreciation is computed principally by the straight-line method over the estimated useful lives of the assets as follows: Land improvements 5 to 15 years Buildings and improvements 10 to 32 years Machinery, equipment and office furniture 2 to 8 years |
LONG-LIVED ASSETS | LONG-LIVED ASSETS In accordance with ASC 360, Property, Plant, and Equipment (“ASC 360”), when an indicator of potential impairment exists, we evaluate the recoverability of our long-lived assets by determining whether unamortized balances could be recovered through undiscounted future operating cash flows over the remaining lives of the assets. If the sum of the expected future cash flows was less than the carrying value of the assets, an impairment loss would be recognized for the excess of the carrying value over the fair value. |
LEASES | LEASES In February 2016, the Financial Accounting Standards Board (FASB) issued Accounting Standard Update (ASU) No. 2016‑02, “Leases (Topic 842)” (ASU 2016‑02). Under ASU 2016‑02, an entity will be required to recognize assets and liabilities for the rights and obligations created by leases on the entity’s balance sheet for both finance and operating leases. For leases with a term of 12 months or less, an entity can elect to not recognize lease assets and lease liabilities and expense the lease over a straight-line basis for the term of the lease. ASU 2016‑02 will require new disclosures that depict the amount, timing, and uncertainty of cash flows pertaining to an entity’s leases. Companies are required to adopt the new standard for annual and interim periods beginning after December 15, 2018. Early adoption of ASU 2016‑02 is permitted. The FASB has decided to amend certain aspects of its new leasing standard in an attempt to provide a relief from implementation costs. Specifically, entities may elect not to restate their comparative periods in the period of adoption when transitioning to the new standard. The Company will elect practical expedients permitted under the transition guidance within the new standard, which among other things, allows the carryforward of historical lease classification, lease and related non-lease components accounted as a single component, and hindsight practical expedient to determine the reasonably certain lease term for existing leases. As required by the standard, the Company expects to make additional disclosures related to the nature and type of leases, practical expedients applied, and adoption method in the first quarter of 2019 fiscal year. The Company expects $60-80 million impact on our consolidated balance sheets and no material impact on our consolidated income statement. |
GOODWILL | GOODWILL Goodwill represents the excess of the purchase price over the fair value of net tangible and identifiable intangible assets of acquired businesses. Goodwill and intangible assets deemed to have indefinite lives are not amortized, but are subject to impairment tests at least annually in accordance with ASC 350, Intangibles-Goodwill and Other. We review the carrying amounts of goodwill and other non-amortizable intangibles by reporting unit to determine if such assets may be impaired. As the carrying amount of these assets are recoverable based upon a discounted cash flow and market approach analysis, no impairment was recognized. Our annual testing date for evaluating goodwill and indefinite-lived intangible asset impairment is the first day of the Company’s fourth fiscal quarter for all reporting units. Additionally, the Company reviews various triggering events throughout the year to ensure that a mid-year impairment analysis is not required. |
FOREIGN CURRENCY | FOREIGN CURRENCY Our foreign operations use the local currency as their functional currency. Accordingly, assets and liabilities are translated at exchange rates as of the balance sheet date and revenues and expenses are translated using weighted average rates, with translation adjustments included as a separate component of shareholders’ equity. Gains and losses arising from re-measuring foreign currency transactions are included in earnings. |
INSURANCE RESERVES | INSURANCE RESERVES Our wholly-owned insurance company, Ardellis Insurance Ltd.(“Ardellis”), was incorporated on April 21, 2001 under the laws of Bermuda and is licensed as a Class 3A insurer under the Insurance Act 1978 of Bermuda. On April 14, 2017 the U.S. Branch of Ardellis Insurance Ltd. was granted its Certificate of Authority to transact property and casualty insurance lines as an admitted carrier in the State of Michigan. We are primarily self-insured for certain employee health benefits, and have self-funded retentions for general liability, automobile liability, property and workers’ compensation. We are fully self-insured for environmental liabilities. The general liability, automobile liability, property, workers’ compensation, and certain environmental liabilities are managed through Ardellis; the related assets and liabilities of which are included in the consolidated financial statements as of December 29, 2018 and December 30, 2017. Our policy is to accrue amounts equal to actuarially determined or internally computed liabilities. The actuarial and internal valuations are based on historical information along with certain assumptions about future events. Changes in assumptions for such matters as legal actions, medical cost trends, and changes in claims experience could cause these estimates to change in the future. In addition to providing coverage for the Company, Ardellis provides Excess Loss Insurance (primarily medical and prescription drug) to certain third parties. As of December 29, 2018, Ardellis had 39 such contracts in place. Reserves associated with these contracts were $4.9 million at December 29, 2018 and $3.4 million at December 30, 2017, and are accrued based on third party actuarial valuations of the expected future liabilities. |
INCOME TAXES | INCOME TAXES Deferred income tax assets and liabilities are computed for differences between the financial statement and tax basis of assets and liabilities that will result in taxable or deductible amounts in the future. Such deferred income tax asset and liability computations are based on enacted tax laws and rates. Valuation allowances are established when necessary to reduce deferred income tax assets to the amounts expected to be realized. Income tax expense is the tax payable or refundable for the period plus or minus the change during the period in deferred income tax assets and liabilities. |
REVENUE RECOGNITION | REVENUE RECOGNITION On May 28, 2014, the FASB issued ASU No. 2014-09 (Accounting Standard Codification 606), Revenue from Contracts with Customers. Topic 606 supersedes the revenue recognition requirements in Accounting Standards Codification Topic 605, Revenue Recognition, and requires the recognition of revenue when promised goods or services are transferred to customers in an amount that reflects the considerations to which the entity expects to be entitled to in exchange for those goods or services. The ASU requires additional disclosure about the nature, amount, timing and uncertainty of revenue and cash flows arising from customer contracts, including significant judgments and changes in judgments. The Company has adopted the requirements of the new standard as of January 1, 2018, and utilized the modified retrospective method of transition which was applied to all contracts. The Company completed the new revenue recognition standard assessment and determined that there was no material impact to our consolidated financial statements, aside from additional required disclosures, thus no needed adjustment to the opening retained earnings for the annual reporting period. Within the three markets (retail, industrial, and construction) that the Company operates, there are a variety of written and oral contracts that are utilized to generate revenue from the sale of wood, wood composite and other products. The transaction price is stated at the purchase order level, which includes shipping and/or freight costs and any applicable governmental authority taxes. The majority of our contracts have a single performance obligation concentrated around the delivery of goods to the carrier, Free On Board (FOB) shipping point. Therefore, revenue is recognized when this performance obligation is satisfied. Generally, title and control passes at the time of shipment. In certain circumstances, the customer takes title when the shipment arrives at the destination. However, our shipping process is typically completed the same day. Certain customer products that we provide require installation by the Company or a 3rd party. Installation revenue is recognized upon completion, which is typically 2-3 days after receipt. If it is determined to utilize a 3rd party for installation, the party will act as an agent to the Company until completion of the installation. Installation revenue represents an immaterial share of the Company’s total sales. The Company utilizes rebates, credits, discounts and/or cash-based incentives with certain customers which are accounted for as variable consideration. We estimate these amounts based on historical and anticipated customer sales and reduce recognized revenues accordingly. We believe that there will not be significant changes to our estimates of variable consideration. Our estimates of variable consideration are considered not constrained as the likelihood and magnitude of a significant reversal are not probable. The allocation of these costs are applied at the invoice level and recognized in conjunction with revenue. Additionally, the volume returns and refunds are estimated on a historical and expected basis which is a reduction of revenue recognized. Earnings on construction contracts are reflected in operations using over time accounting, under either cost to cost or units of delivery methods, depending on the nature of the business at individual operations, which is in accordance with ASC 606 as revenue is recognized when certain performance obligations are performed. Under over time accounting using the cost to cost method, revenues and related earnings on construction contracts are measured by the relationships of actual costs incurred related to the total estimated costs. Under over time accounting using the units of delivery method, revenues and related earnings on construction contracts are measured by the relationships of actual units produced related to the total number of units. Revisions in earnings estimates on the construction contracts are recorded in the accounting period in which the basis for such revisions becomes known. Projected losses on individual contracts are charged to operations in their entirety when such losses become apparent. Our construction contracts are generally entered into with a fixed price and completion of the projects and performance obligations can range from 6 to 18 months in duration. Therefore, our operating results are impacted by, among many other things, labor rates and commodity costs. Invoices are issued routinely throughout the projects’ life and payments are primarily due 45-60 days after invoice date. During the year, we update our estimated costs to complete our projects using current labor and commodity costs and recognize losses to the extent that they exist. The following table presents our gross revenues disaggregated by revenue source: (in thousands) December 29, December 30, Market Classification 2018 2017 % Change FOB Shipping Point Revenue $ 4,440,098 $ 3,867,781 Construction Contract Revenue 125,651 138,422 -9.2% Total Gross Sales 4,565,749 4,006,203 Sales Allowances (76,569) (65,021) Total Net Sales $ 4,489,180 $ 3,941,182 In 2018, $77.8 million and $47.8 million of our construction contract revenue was attributable to our North and West segments, respectively. Construction contract revenue is primarily made up of site-built and framing customers. The following table presents the balances of percentage-of-completion accounts on December 29, 2018 and December 30, 2017 which are included in other current assets and other accrued liabilities, respectively (in thousands): December 29, December 30, 2018 2017 Cost and Earnings in Excess of Billings $ 6,945 $ 5,005 Billings in Excess of Cost and Earnings 3,245 4,435 SHIPPING AND HANDLING OF PRODUCT Shipping and handling costs that are charged to and reimbursed by the customer are recognized as revenue. Costs incurred related to the shipment and handling of products are classified in cost of goods sold. |
EARNINGS PER SHARE | EARNINGS PER SHARE The computation of earnings per share (“EPS”) is as follows (in thousands), which incorporate the retroactive effect of the Company’s 3 for 1 stock split: December 29, December 30, December 31, 2018 2017 2016 Numerator: Net earnings attributable to controlling interest $ 148,598 $ 119,512 $ 101,179 Adjustment for earnings allocated to non-vested restricted common stock (3,396) (2,225) (1,595) Net earnings for calculating EPS $ 145,202 $ 117,287 $ 99,584 Denominator: Weighted average shares outstanding 61,762 61,416 61,089 Adjustment for non-vested restricted common stock (1,411) (1,143) (963) Shares for calculating basic EPS 60,351 60,273 60,126 Effect of dilutive restricted common stock 82 90 99 Shares for calculating diluted EPS 60,433 60,363 60,225 Net earnings per share: Basic $ 2.41 $ 1.95 $ 1.66 Diluted $ 2.40 $ 1.94 $ 1.65 No options were excluded from the computation of diluted EPS for 2018, 2017, or 2016. |
USE OF ACCOUNTING ESTIMATES | USE OF ACCOUNTING ESTIMATES The preparation of financial statements in conformity with accounting principles generally accepted in the United States requires us to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements as well as the reported amounts of revenues and expenses during the reporting period. We believe our estimates to be reasonable; however, actual results could differ from these estimates. |
SEGMENT REPORTING | ASC 280, Segment Reporting (“ASC 280”), defines operating segments as components of an enterprise about which separate financial information is available that is evaluated regularly by the chief operating decision maker in deciding how to allocate resources and in assessing performance. The Company operates manufacturing, treating and distribution facilities throughout North America, Europe, Asia and Australia, but primarily in the United States. The Company manages the operations of its individual locations primarily through a geographic reporting structure under which each location is included in a region and regions are included in our North, South, West, and International divisions. The exceptions to this geographic reporting and management structure are (a) the Company’s Alternative Materials Division, which offers a portfolio of non-wood products and distributes those products nation-wide and is accounted for as a reporting unit within the All Other segment, (b) the Company’s distribution unit (referred to as UFPD) which distributes a variety of products to the manufactured housing industry and is accounted for as a reporting unit within the North segment, and (c) idX division, which designs, manufactures, and installs customized interior fixtures and is accounted for within the All Other segment. With respect to the facilities in the north, south, and west segments, these facilities generally supply the three markets the Company serves nationally - Retail, Industrial, and Construction. Also, substantially all of our facilities support customers in the immediate geographical region surrounding the facility. |
SUMMARY OF SIGNIFICANT ACCOUN_3
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables) | 12 Months Ended |
Dec. 29, 2018 | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |
Schedule of Accounts Receivable Allowances | The following table presents the activity in our accounts receivable allowances (in thousands): Additions Charged to Beginning Costs and Ending Balance Expenses Deductions* Balance Year Ended December 29,2018: Allowance for possible losses on accounts receivable $ 2,424 $ 38,963 $ (38,786) $ 2,601 Year Ended December 30, 2017: Allowance for possible losses on accounts receivable $ 2,845 $ 28,102 $ (28,523) $ 2,424 Year Ended December 31, 2016: Allowance for possible losses on accounts receivable $ 2,672 $ 28,405 $ (28,232) $ 2,845 * |
Schedule of Estimated Useful Lives of Property, Plant, and Equipment | Land improvements 5 to 15 years Buildings and improvements 10 to 32 years Machinery, equipment and office furniture 2 to 8 years |
Schedule of Disaggregation of revenue | (in thousands) December 29, December 30, Market Classification 2018 2017 % Change FOB Shipping Point Revenue $ 4,440,098 $ 3,867,781 Construction Contract Revenue 125,651 138,422 -9.2% Total Gross Sales 4,565,749 4,006,203 Sales Allowances (76,569) (65,021) Total Net Sales $ 4,489,180 $ 3,941,182 |
Schedule of Percentage of Completion Account Balances | The following table presents the balances of percentage-of-completion accounts on December 29, 2018 and December 30, 2017 which are included in other current assets and other accrued liabilities, respectively (in thousands): December 29, December 30, 2018 2017 Cost and Earnings in Excess of Billings $ 6,945 $ 5,005 Billings in Excess of Cost and Earnings 3,245 4,435 |
Schedule of Computation of earnings per share | The computation of earnings per share (“EPS”) is as follows (in thousands), which incorporate the retroactive effect of the Company’s 3 for 1 stock split: December 29, December 30, December 31, 2018 2017 2016 Numerator: Net earnings attributable to controlling interest $ 148,598 $ 119,512 $ 101,179 Adjustment for earnings allocated to non-vested restricted common stock (3,396) (2,225) (1,595) Net earnings for calculating EPS $ 145,202 $ 117,287 $ 99,584 Denominator: Weighted average shares outstanding 61,762 61,416 61,089 Adjustment for non-vested restricted common stock (1,411) (1,143) (963) Shares for calculating basic EPS 60,351 60,273 60,126 Effect of dilutive restricted common stock 82 90 99 Shares for calculating diluted EPS 60,433 60,363 60,225 Net earnings per share: Basic $ 2.41 $ 1.95 $ 1.66 Diluted $ 2.40 $ 1.94 $ 1.65 |
FAIR VALUE (Tables)
FAIR VALUE (Tables) | 12 Months Ended |
Dec. 29, 2018 | |
FAIR VALUE | |
Assets measured at fair value | December 29, 2018 December 30, 2017 Quoted Prices with Quoted Prices with Prices in Other Prices with Prices in Other Active Observable Unobservable Active Observable Markets Inputs Inputs Markets Inputs (in thousands) (Level 1) (Level 2) (Level 3) Total (Level 1) (Level 2) Total Money market funds $ 56 $ 5,267 $ — $ 5,323 $ 64 $ 3,071 $ 3,135 Fixed income funds 3,387 9,738 — 13,125 1,182 6,974 8,156 Equity securities 7,262 — — 7,262 10,710 — 10,710 Hedge funds — — 1,756 1,756 Mutual funds: Domestic stock funds 2,846 — — 2,846 367 — 367 International stock funds 937 — — 937 91 — 91 Target funds 237 — — 237 270 — 270 Bond funds 796 — — 796 209 — 209 Alternative funds 1,318 — — 1,318 Total mutual funds 6,134 — — 6,134 937 — 937 Total $ 16,839 $ 15,005 1,756 $ 33,600 $ 12,893 $ 10,045 $ 22,938 Assets at fair value $ 16,839 $ 15,005 1,756 $ 33,600 $ 12,893 $ 10,045 $ 22,938 |
Available for sale investment portfolio | December 29,2018 December 30,2017 Unrealized Unrealized Cost Gain/(Loss) Fair Value Cost Gain/(Loss) Fair Value Fixed Income $ 13,301 $ (176) $ 13,125 $ 8,170 $ (14) $ 8,156 Equity 7,141 121 7,262 9,185 1,524 10,709 Mutual Funds 5,815 (567) 5,248 — — — Hedge Funds 1,722 34 1,756 — — — Total $ 27,979 $ (588) $ 27,391 $ 17,355 $ 1,510 $ 18,865 |
BUSINESS COMBINATIONS (Tables)
BUSINESS COMBINATIONS (Tables) | 12 Months Ended |
Dec. 29, 2018 | |
BUSINESS COMBINATIONS | |
Business Acquisitions Accounted for Using Purchase Method | We completed the following business combinations in fiscal 2018 and 2017, which were accounted for using the purchase method (in thousands). Net Company Acquisition Intangible Tangible Operating Name Date Purchase Price Assets Assets Segment October 22, 2018 $15,115 $ 8,592 $ 6,523 North Pak-Rite, LTD ("Pak-Rite") A designer and manufacturer of packaging for high-value products, such as medical, aerospace and automation equipment. Pak-Rite had annual sales of approximately $15 million. The acquisition of Pak-Rite allows us to grow our portfolio of packaging products and our presence in this region. July 31, 2018 $1,016 $ 250 $ 766 West The Pallet Place, LLC ("Pallet Place") A manufacturer and distributor of total packaging solutions in timber, crates, skids, and pallets. Pallet Place had annual sales of approximately $5 million. The acquisition of Pallet Place allows us to increase our industrial business and creates operating leverage by consolidating with another regional operation. June 1, 2018 $23,866 $ 12,497 $ 11,369 South North American Container Corporation ("NACC") A manufacturer of structural packaging products, including steel, corrugated and hardwood packaging. NACC had annual sales of approximately $71 million. The acquisition of NACC allows us to enhance our presence in this region, expand our product offering, and serve customers more cost effectively. April 9, 2018 $3,890 $ 2,235 $ 1,655 West Fontana Wood Products ("Fontana") A manufacturer and distributor of lumber and trusses in the Southern California region. Fontana had annual sales of approximately $12 million. The acquisition of Fontana allows us to expand our manufactured housing business and creates operating leverage by consolidating with another regional operation. April 3, 2018 $1,347 $ 1,287 $ 60 All Other Expert Packaging ("Expert") A manufacturer and distributor of total packaging solutions in timber, crates, pallets, and skids. Expert had annual sales of approximately $3.6 million. The acquisition of Expert allows us to make progress on our goal of becoming a global provider of packaging solutions. January 23, 2018 $2,942 $ 850 $ 2,092 West Spinner Wood Products, LLC ("Spinner") A manufacturer and distributor of agricultural bin and various industrial packaging. Spinner had annual sales of approximately $8 million. The acquisition of Spinner allows us to expand our industrial packaging product offering and creates operating leverage by consolidating with other regional operations. January 15, 2018 $5,784 $ 50 $ 5,734 North Great Northern Lumber, LLC A manufacturer of industrial products as well as serving the concrete forming market in the Chicago area. Great Northern Lumber had annual sales of approximately $25 million. The acquisition of Great Northern Lumber enables us to expand our concrete forming product offering and regional coverage. October 16, 2017 $931 $ 909 $ 22 All Other Silverwater Box A manufacturer and distributor of total packaging solutions in timber, plastic, steel, fiberglass, and cardboard. Silverwater Box has annual sales of approximately $2.8 million. The acquisition of Silverwater Box allows us to make progress on our goal of becoming a global provider of packaging solutions. May 26, 2017 $5,042 $ 4,880 $ 162 South Go Boy Pallets, LLC ("Go Boy") A manufacturer and distributor of industrial pallets and packaging in Georgia and North Carolina. Go Boy has annual sales of approximately $8 million. The acquisition of Go Boy enabled us to expand our industrial packaging product offering and lumber sourcing in this region. March 6, 2017 $31,818 $ 7,653 $ 24,165 South Robbins Manufacturing Co. ("Robbins") A manufacturer of treated wood products with facilities in Florida, Georgia, and North Carolina. Robbins has annual sales of approximately $86 million. The acquisition of Robbins allowed us to expand our presence in this region and serve customers more cost effectively. March 6, 2017 $22,789 $ 14,341 $ 8,448 North Quality Hardwood Sales, LLC ("Quality") A manufacturer and supplier of hardwood products, including components of cabinets used in homes and recreational vehicles. Quality has annual sales of approximately $30 million. The acquisition of Quality enabled us to expand our product offering to include hardwood-based products. |
Acquired Intangible Assets | At December 29, 2018, the amounts assigned to major intangible classes for the business combinations mentioned above are as follows (in thousands): Non- Goodwill - Compete Customer Tax Agreements Relationships Tradename Goodwill Deductible Pak-Rite $ — $ 4,300 * $ — $ 4,292 * $ 8,592 Pallet Place — 250 — — 250 NACC — 3,500 * — 8,997 * 12,497 Fontana — 2,235 — — 2,235 Expert Packaging 221 809 257 — — Spinner 850 — — — 850 Great Northern Lumber 50 — — — 50 Silverwater Box — — — 909 — Go Boy 225 4,655 — — 4,880 Robbins 560 3,530 450 3,113 7,653 Quality 830 5,720 400 7,391 14,341 *(estimate) |
GOODWILL AND OTHER INTANGIBLE_2
GOODWILL AND OTHER INTANGIBLE ASSETS (Tables) | 12 Months Ended |
Dec. 29, 2018 | |
GOODWILL AND OTHER INTANGIBLE ASSETS | |
Schedule of Goodwill | The changes in the net carrying amount of goodwill by reporting segment for the years ended December 29, 2018 and December 30, 2017, are as follows (in thousands): North South West All Other Total Balance as of December 31, 2016 43,386 43,625 87,730 23,794 198,535 2017 Acquisitions 7,391 3,113 — 909 11,413 Foreign Exchange, Net 350 — — 2,346 2,696 Balance as of December 30, 2017 51,127 46,738 87,730 27,049 212,644 2018 Acquisitions 4,292 8,996 — — 13,288 Foreign Exchange, Net (365) — — (1,450) (1,815) Balance as of December 29, 2018 $ 55,054 $ 55,734 $ 87,730 $ 25,599 $ 224,117 |
Other Intangible Assets | The following amounts were included in other amortizable intangible assets, net as of December 29, 2018 and December 30, 2017 (in thousands): 2018 2017 Accumulated Accumulated Assets Amortization Assets Amortization Non-compete agreements $ 10,232 $ (5,517) $ 9,841 $ (4,208) Customer relationships 40,307 (6,843) 31,630 (5,986) Licensing agreements 4,589 (3,909) 4,589 (3,450) Patents 792 (284) 792 (254) Tradename 2,879 (760) 2,420 (464) Total $ 58,799 $ (17,313) $ 49,272 $ (14,362) |
Estimated Useful Lives of Intangible Assets | Weighted Average Intangible Asset Type Estimated Useful Life Amortization Period Non-compete agreements 3 to 15 years 6.8 years Customer relationship 5 to 15 years 11.4 years Licensing agreements 10 years 10 years Tradename (amortizable) 5 to 15 years 11.7 years |
Expected Amortization Expense | Amortization expense of intangibles totaled $6.4 million, $4.9 million and $2.8 million in 2018, 2017 and 2016, respectively. The estimated amortization expense for intangibles for each of the five succeeding fiscal years is as follows (in thousands): 2019 $ 6,908 2020 5,802 2021 5,503 2022 5,119 2023 3,800 Thereafter 14,354 Total $ 41,486 |
DEBT (Tables)
DEBT (Tables) | 12 Months Ended |
Dec. 29, 2018 | |
DEBT | |
Long-term Debt and Capital Lease Obligations | Long-term debt obligations are summarized as follows on December 29, 2018 and December 31, 2017 (amounts in thousands): 2018 2017 Series 2018 Senior Notes C, due on June 14, 2028, interest payable semi-annually at 4.20% $ 40,000 $ — Series 2018 Senior Notes D, due on June 14, 2030, interest payable semi-annually at 4.27% 35,000 — Series 2012 Senior Notes Tranche A, due on December 17, 2022, interest payable semi-annually at 3.89% 35,000 35,000 Series 2012 Senior Notes Tranche B, due on December 17, 2024, interest payable semi-annually at 3.98% 40,000 40,000 Revolving credit facility totaling $375 million due on November 1, 2023, interest payable monthly at a floating rate (3.39% on December 29, 2018 and 2.41% on December 30, 2017) 42,490 59,422 Series 1999 Industrial Development Revenue Bonds, due on August 1, 2029, interest payable monthly at a floating rate (1.94% on December 29, 2018 and 1.08% on December 30, 2017) 3,300 3,300 Series 2000 Industrial Development Revenue Bonds, due on October 1, 2020, interest payable monthly at a floating rate (2.00% on December 29, 2018 and 1.14% on December 30, 2017) 2,700 2,700 Series 2002 Industrial Development Revenue Bonds, due on December 1, 2022, interest payable monthly at a floating rate (1.99% on December 29, 2018 and 1.13% on December 30, 2017) 3,700 3,700 Capital leases and foreign affiliate debt 311 2,058 202,501 146,180 Less current portion (148) (1,329) Less debt issuance costs (223) (177) Long-term portion $ 202,130 $ 144,674 |
Principal Maturities of Long-term Debt and Capital Lease Obligations | On December 29, 2018, the principal maturities of long-term debt and capital lease obligations are as follows (in thousands): 2019 $ 148 2020 2,834 2021 29 2022 38,700 2023 42,490 Thereafter 118,300 Total $ 202,501 |
LEASES (Tables)
LEASES (Tables) | 12 Months Ended |
Dec. 29, 2018 | |
LEASES | |
Future Minimum Lease Payments | Future minimum payments under non-cancelable operating leases on December 29, 2018 are as follows (in thousands): Operating Leases 2019 $ 17,242 2020 11,969 2021 9,784 2022 8,346 2023 6,382 Thereafter 22,498 Total minimum lease payments $ 76,221 |
COMMON STOCK (Tables)
COMMON STOCK (Tables) | 12 Months Ended |
Dec. 29, 2018 | |
COMMON STOCK | |
Schedule of common stock issuances | December 29, 2018 Share Issuance Activity Common Stock Average Share Price Shares issued under the employee stock purchase plan 38 $ 35.58 Shares issued under the employee stock gift program 3 33.56 Shares issued under the director retainer stock program 101 17.17 Shares issued under the long term stock incentive plan 164 35.16 Shares issued under the executive stock match grants 94 32.94 Forfeitures (14) - Total shares issued under stock grant programs 348 $ 29.37 Shares issued under the deferred compensation plans 167 $ 36.98 December 30, 2017 Share Issuance Activity Common Stock Average Share Price Shares issued under the employee stock purchase plan 24 $ 32.80 Shares issued under the employee stock gift program 3 31.92 Shares issued under the director retainer stock program 62 19.02 Shares issued under the long term stock incentive plan 240 31.81 Shares issued under the executive stock match grants 129 32.03 Forfeitures (5) - Total shares issued under stock grant programs 429 $ 30.06 Shares issued under the deferred compensation plans 159 $ 32.16 |
Nonvested Restricted Shares Activity | A summary of the nonvested restricted stock awards granted under the LTSIP is as follows: Weighted- Unrecognized Average Weighted- Compensation Period to Restricted Average Grant Expense Recognize Awards Date Fair Value (in millions) Expense Nonvested at December 26, 2015 623,748 13.66 5.2 2.53 years Granted 350,892 23.96 Vested (180,465) 15.66 Forfeited (2,643) 21.45 Nonvested at December 31, 2016 791,532 19.32 4.8 1.51 years Granted 388,248 32.03 Vested (141,111) 12.71 Forfeited (5,043) 30.14 Nonvested at December 30, 2017 1,033,626 24.24 7.1 1.31 years Granted 247,068 36.52 Vested (107,865) 18.11 Forfeited (12,750) 24.19 Nonvested at December 29, 2018 1,160,079 $ 23.32 $ 7.6 1.12 years |
INCOME TAXES (Tables)
INCOME TAXES (Tables) | 12 Months Ended |
Dec. 29, 2018 | |
INCOME TAXES | |
Components of Income Tax Expense (Benefit) | Income tax provisions for the years ended December 29, 2018, December 30, 2017, and December 31, 2016 are summarized as follows (in thousands): 2018 2017 2016 Currently Payable: Federal $ 31,492 $ 44,413 $ 42,397 State and local 7,544 8,579 6,341 Foreign 5,527 6,240 6,143 44,563 59,232 54,881 Net Deferred: Federal 2,965 (7,681) (455) State and local (522) (864) 438 Foreign (1,565) 1,280 310 878 (7,265) 293 $ 45,441 $ 51,967 $ 55,174 |
Components of Earnings Before Income Taxes | 2018 2017 2016 U.S. $ 180,261 $ 151,395 $ 140,106 Foreign 17,592 24,612 20,565 Total $ 197,853 $ 176,007 $ 160,671 |
Effective Income Tax Rate Reconciliation | 2018 2017 2016 Statutory federal income tax rate 21.0 % 35.0 % 35.0 % State and local taxes (net of federal benefits) 3.8 3.0 3.1 Effect of noncontrolling owned interest in earnings of partnerships (0.1) (0.2) (0.2) Manufacturing deduction n/a (2.5) (2.4) Tax credits, including foreign tax credit (1.6) (2.0) (1.4) Change in uncertain tax positions reserve 0.1 0.4 0.4 Other permanent differences 0.6 (0.1) 0.1 Other, net (0.7) (0.6) (0.3) Impact of Tax Act and reduction of corporate tax rate (0.1) (3.5) — Effective income tax rate 23.0 % 29.5 % 34.3 % |
Components of Deferred Tax Assets and Liabilities | Temporary differences which give rise to deferred income tax assets and (liabilities) on December 29, 2018 and December 30, 2017 are as follows (in thousands): 2018 2017 Employee benefits $ 20,914 $ 17,048 Net operating loss carryforwards 6,520 8,592 Foreign subsidiary capital loss carryforward 504 546 Other tax credits 586 709 Inventory 1,090 358 Reserves on receivables 802 714 Accrued expenses 1,593 2,060 Other, net 2,785 1,879 Gross deferred income tax assets 34,794 31,906 Valuation allowance (2,707) (4,706) Deferred income tax assets 32,087 27,200 Depreciation (24,881) (19,992) Intangibles (20,225) (19,422) Other, net — — Deferred income tax liabilities (45,106) (39,414) Net deferred income tax liability $ (13,019) $ (12,214) |
Schedule of NOL and credit carryforwards | Net Operating Losses Tax Credits U.S. State Foreign U.S. State 2018 – 2022 $ — $ 165 $ 347 $ — $ 381 2023 - 2027 — 526 635 — — 2028 - 2032 2,859 672 114 — — 2033 - 2037 41 812 — — — Thereafter — 293 56 — — Total $ 2,900 $ 2,468 $ 1,152 $ — $ 381 |
ACCOUNTING FOR UNCERTAINTY IN_2
ACCOUNTING FOR UNCERTAINTY IN INCOME TAXES (Tables) | 12 Months Ended |
Dec. 29, 2018 | |
ACCOUNTING FOR UNCERTAINTY IN INCOME TAXES | |
Reconciliation of Beginning and Ending Amount of Unrecognized Tax Benefits | A reconciliation of the beginning and ending amount of unrecognized tax benefits is as follows (in thousands): 2018 2017 2016 Gross unrecognized tax benefits beginning of year $ 4,000 $ 3,381 $ 2,209 Increase in tax positions for prior years (366) 4 243 Increase in tax positions due to acquisitions — — 362 Increase in tax positions for current year 1,326 1,107 905 Settlements with taxing authorities — (2) (32) Lapse in statute of limitations (582) (490) (306) Gross unrecognized tax benefits end of year $ 4,378 $ 4,000 $ 3,381 |
SEGMENT REPORTING (Tables)
SEGMENT REPORTING (Tables) | 12 Months Ended |
Dec. 29, 2018 | |
SEGMENT REPORTING | |
Segment Reporting | 2018 All North South West Other Corporate Total Net sales to outside customers $ 1,279,459 $ 1,024,747 $ 1,599,274 $ 585,700 $ — $ 4,489,180 Intersegment net sales 56,682 76,297 56,004 235,905 — 424,888 Interest expense (income) 58 (6) 197 (1,486) 10,130 8,893 Amortization expense 830 1,292 1,998 2,273 — 6,393 Depreciation expense 12,062 8,244 14,836 10,341 9,466 54,949 Segment earnings from operations 66,239 60,049 103,357 6,779 (29,161) 207,263 Segment assets 386,483 266,503 496,939 395,727 101,896 1,647,548 Capital expenditures 17,820 9,185 26,024 39,168 3,665 95,862 2017 All North South West Other Corporate Total Net sales to outside customers $ 1,133,656 $ 837,370 $ 1,417,924 $ 552,232 $ — $ 3,941,182 Intersegment net sales 67,161 74,566 83,245 167,568 — 392,540 Interest expense 4 160 293 (473) 6,234 6,218 Amortization expense 559 607 1,723 1,971 — 4,860 Depreciation expense 10,511 6,880 14,116 8,586 8,443 48,536 Segment earnings from operations 61,326 46,646 82,465 17,296 (26,264) 181,469 Segment assets 351,270 240,661 462,311 356,264 54,171 1,464,677 Capital expenditures 23,026 12,286 23,212 9,865 2,727 71,116 2016 All North South West Other Corporate Total Net sales to outside customers $ 1,000,426 $ 711,862 $ 1,251,093 $ 277,112 $ — $ 3,240,493 Intersegment net sales 57,770 38,641 88,311 19,322 — 204,044 Interest expense 1 307 387 143 3,737 4,575 Amortization expense 115 — 1,858 822 — 2,795 Depreciation expense 8,948 6,190 13,326 4,531 7,828 40,823 Segment earnings from operations 59,408 47,146 76,875 16,639 (35,630) 164,438 Segment assets 302,009 192,085 438,674 313,304 45,986 1,292,058 Capital expenditures 10,902 5,571 19,648 6,037 11,604 53,762 |
Information Regarding Principal Geographic Areas | Information regarding principal geographic areas was as follows (in thousands): 2018 2017 2016 Long-Lived Long-Lived Long-Lived Tangible Tangible Tangible Net Sales Assets Net Sales Assets Net Sales Assets United States $ 4,382,356 $ 342,326 $ 3,821,366 $ 313,976 $ 3,162,331 $ 280,362 Foreign 106,824 34,312 119,816 30,380 78,162 26,106 Total $ 4,489,180 $ 376,638 $ 3,941,182 $ 344,356 $ 3,240,493 $ 306,468 |
Gross Sales by Major Product Classification | The following table presents, for the periods indicated, our gross sales (in thousands) by major product classification. Year Ended December 29, December 30, December 31, 2018 2017 2016 Value-Added Sales Trusses – residential, modular and manufactured housing $ 421,996 $ 368,591 $ 334,956 Fencing 179,037 187,905 176,668 Decking and railing – composite, wood and other 271,499 244,910 200,004 Turn-key framing and installed sales 151,260 149,520 141,474 Industrial packaging and components 581,622 471,262 391,610 Engineered wood products (eg. LVL; i-joist) 83,212 76,507 76,503 In-store fixtures 252,341 260,174 87,262 Manufactured brite and other lumber 102,333 78,638 68,517 Wall panels 69,889 61,226 53,279 Outdoor DIY products (eg. stakes; landscape ties) 124,907 110,327 106,284 Construction and building materials (eg. door packages; drywall) 305,374 265,048 204,732 Lattice – plastic and wood 48,614 48,736 50,556 Manufactured brite and other panels 97,314 75,742 60,753 Siding, trim and moulding 98,370 85,016 66,048 Hardware 24,662 21,218 20,713 Manufactured treated lumber 20,889 17,584 17,412 Other 21,342 12,604 10,967 Total Value-Added Sales $ 2,854,661 $ 2,535,008 $ 2,067,738 Commodity-Based Sales Non-manufactured brite and other lumber 718,456 576,374 469,042 Non-manufactured treated lumber 647,222 575,505 479,333 Non-manufactured brite and other panels 285,888 271,310 238,806 Non-manufactured treated panels 39,768 34,970 30,374 Other 19,754 13,036 12,084 Total Commodity-Based Sales $ 1,711,088 $ 1,471,195 $ 1,229,639 Total Gross Sales $ 4,565,749 $ 4,006,203 $ 3,297,377 Sales allowances (76,569) (65,021) (56,884) Total Net Sales $ 4,489,180 $ 3,941,182 $ 3,240,493 |
QUARTERLY FINANCIAL INFORMATI_2
QUARTERLY FINANCIAL INFORMATION (UNAUDITED) (Tables) | 12 Months Ended |
Dec. 29, 2018 | |
QUARTERLY FINANCIAL INFORMATION (UNAUDITED) | |
Quarterly Financial Information | The following table sets forth selected financial information for all of the quarters, consisting of 13 and 14 weeks during the years ended December 29, 2018 and December 30, 2017, respectively, (in thousands, except per share data): First Second Third Fourth 2018 2017 2018 2017 2018 2017 2018 2017 Net sales $ 993,857 $ 846,130 $ 1,294,440 $ 1,072,375 $ 1,212,702 $ 1,056,586 $ 988,179 $ 966,091 Gross profit 130,889 120,740 165,689 148,240 158,673 144,687 137,643 129,159 Net earnings 33,582 21,634 45,130 34,574 42,068 34,669 31,633 33,162 Net earnings attributable to controlling interest 32,833 21,062 44,044 33,642 41,219 33,693 30,502 31,115 Basic earnings per share 0.53 0.34 0.71 0.55 0.67 0.55 0.50 0.51 Diluted earnings per share 0.53 0.34 0.71 0.55 0.66 0.55 0.50 0.51 |
SUMMARY OF SIGNIFICANT ACCOUN_4
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Narrative (Details) $ in Thousands | 12 Months Ended | ||||
Dec. 29, 2018USD ($)contractshares | Dec. 30, 2017USD ($)shares | Dec. 31, 2016USD ($)shares | Dec. 30, 2018USD ($) | Dec. 31, 2017USD ($) | |
Antidilutive Securities Excluded from Computation of Earnings Per Share | |||||
Options to purchase shares excluded from computation of EPS (in shares) | shares | 0 | 0 | 0 | ||
Requisite ownership to consolidate (in hundredths) (or more) | 50.00% | ||||
Length of fiscal year | 364 days | 364 days | 371 days | ||
Additional sales due to additional week in fiscal year | $ 60,000 | ||||
Accounts receivable retainage | $ 5,500 | $ 4,800 | |||
Accounts receivable retainage, collection period | 18 months | ||||
Concentration of accounts receivable related to largest customer | $ 44,500 | 55,900 | |||
Inventory on consignment | $ 16,800 | 14,800 | |||
Number of insurance contracts with third party by Ardellis | contract | 39 | ||||
Reserve associated with contracts to third party by Ardellis | $ 4,900 | 3,400 | |||
New accounting pronouncement | |||||
Retained earnings | $ 839,917 | $ 736,212 | |||
Minimum | |||||
Antidilutive Securities Excluded from Computation of Earnings Per Share | |||||
Length of fiscal year | 364 days | ||||
Maximum | |||||
Antidilutive Securities Excluded from Computation of Earnings Per Share | |||||
Length of fiscal year | 371 days | ||||
ASU 2016-01 | |||||
New accounting pronouncement | |||||
Equity Securities Fair Value | $ 10,700 | ||||
Equity securities, unrealized loss | $ 1,900 | ||||
ASU 2016-01 | Restatement | |||||
New accounting pronouncement | |||||
Retained earnings | $ 900 | ||||
ASU 2016-02 | Minimum | |||||
New accounting pronouncement | |||||
Right-of-use assets | $ 60,000 | ||||
Operating lease liability | 60,000 | ||||
ASU 2016-02 | Maximum | |||||
New accounting pronouncement | |||||
Right-of-use assets | 80,000 | ||||
Operating lease liability | $ 80,000 |
SUMMARY OF SIGNIFICANT ACCOUN_5
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Schedule of Accounts Receivable Allowances (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 29, 2018 | Dec. 30, 2017 | Dec. 31, 2016 | |
Allowance for Doubtful Accounts Receivable [Roll Forward] | |||
Beginning Balance | $ 2,424 | $ 2,845 | $ 2,672 |
Additions Charged to Costs and Expenses | 38,963 | 28,102 | 28,405 |
Deductions | (38,786) | (28,523) | (28,232) |
Ending Balance | $ 2,601 | $ 2,424 | $ 2,845 |
SUMMARY OF SIGNIFICANT ACCOUN_6
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Schedule of Estimated Useful Lives of Property, Plant, and Equipment (Details) | 12 Months Ended |
Dec. 29, 2018 | |
Land Improvements | Minimum | |
Property, Plant and Equipment | |
Property, plant and equipment, useful life | 5 years |
Land Improvements | Maximum | |
Property, Plant and Equipment | |
Property, plant and equipment, useful life | 15 years |
Building and Improvements | Minimum | |
Property, Plant and Equipment | |
Property, plant and equipment, useful life | 10 years |
Building and Improvements | Maximum | |
Property, Plant and Equipment | |
Property, plant and equipment, useful life | 32 years |
Machinery, Equipment and Office Furniture | Minimum | |
Property, Plant and Equipment | |
Property, plant and equipment, useful life | 2 years |
Machinery, Equipment and Office Furniture | Maximum | |
Property, Plant and Equipment | |
Property, plant and equipment, useful life | 8 years |
SUMMARY OF SIGNIFICANT ACCOUN_7
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Revenue Recognition (Details) $ in Thousands | 3 Months Ended | 12 Months Ended | ||||||||||
Dec. 29, 2018USD ($)item | Sep. 29, 2018USD ($) | Jun. 30, 2018USD ($) | Mar. 31, 2018USD ($) | Dec. 30, 2017USD ($) | Sep. 30, 2017USD ($) | Jul. 01, 2017USD ($) | Apr. 01, 2017USD ($) | Dec. 29, 2018USD ($)item | Dec. 30, 2017USD ($) | Dec. 31, 2016USD ($) | Dec. 31, 2017USD ($) | |
Revenue Recognition | ||||||||||||
Retained earnings | $ 839,917 | $ 736,212 | $ 839,917 | $ 736,212 | ||||||||
Number of markets in which the entity operates (in markets) | item | 3 | 3 | ||||||||||
Total Gross Sales | $ 4,565,749 | 4,006,203 | $ 3,297,377 | |||||||||
Sales Allowances | (76,569) | (65,021) | ||||||||||
Total Net Sales | $ 988,179 | $ 1,212,702 | $ 1,294,440 | $ 993,857 | $ 966,091 | $ 1,056,586 | $ 1,072,375 | $ 846,130 | $ 4,489,180 | 3,941,182 | $ 3,240,493 | |
Change % | 14.00% | |||||||||||
Change % in sales allowances | 17.80% | |||||||||||
Change % in net sales | 13.90% | |||||||||||
FOB Shipping Point Revenue | ||||||||||||
Revenue Recognition | ||||||||||||
Total Gross Sales | $ 4,440,098 | 3,867,781 | ||||||||||
Change % | 14.80% | |||||||||||
Construction Contract Revenue | ||||||||||||
Revenue Recognition | ||||||||||||
Total Gross Sales | $ 125,651 | $ 138,422 | ||||||||||
Change % | (9.20%) | |||||||||||
Construction Contract Revenue | North | ||||||||||||
Revenue Recognition | ||||||||||||
Total Gross Sales | $ 77,800 | |||||||||||
Construction Contract Revenue | West | ||||||||||||
Revenue Recognition | ||||||||||||
Total Gross Sales | $ 47,800 | |||||||||||
Minimum | ||||||||||||
Revenue Recognition | ||||||||||||
Number of days revenue is recognized | 2 days | |||||||||||
Period of time invoices are due | 45 days | |||||||||||
Minimum | Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2018-12-30 | Construction Contract Revenue | ||||||||||||
Revenue Recognition | ||||||||||||
Number of months to complete contract projects | 6 months | 6 months | ||||||||||
Maximum | ||||||||||||
Revenue Recognition | ||||||||||||
Number of days revenue is recognized | 3 days | |||||||||||
Period of time invoices are due | 60 days | |||||||||||
Maximum | Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2018-12-30 | Construction Contract Revenue | ||||||||||||
Revenue Recognition | ||||||||||||
Number of months to complete contract projects | 18 months | 18 months | ||||||||||
Adjustment | ASU 2014-09 | ||||||||||||
Revenue Recognition | ||||||||||||
Retained earnings | $ 0 |
SUMMARY OF SIGNIFICANT ACCOUN_8
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Schedule of Percentage of Completion Account Balances (Details) - USD ($) $ in Thousands | Dec. 29, 2018 | Dec. 30, 2017 |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | ||
Cost and Earnings in Excess of Billings | $ 6,945 | $ 5,005 |
Billings in Excess of Cost and Earnings | $ 3,245 | $ 4,435 |
SUMMARY OF SIGNIFICANT ACCOUN_9
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Schedule of Computation of Earnings Per Share (Details) $ / shares in Units, shares in Thousands, $ in Thousands | Nov. 14, 2017 | Dec. 29, 2018USD ($)$ / shares | Sep. 29, 2018USD ($)$ / shares | Jun. 30, 2018USD ($)$ / shares | Mar. 31, 2018USD ($)$ / shares | Dec. 30, 2017USD ($)$ / shares | Sep. 30, 2017USD ($)$ / shares | Jul. 01, 2017USD ($)$ / shares | Apr. 01, 2017USD ($)$ / shares | Dec. 29, 2018USD ($)$ / sharesshares | Dec. 30, 2017USD ($)$ / sharesshares | Dec. 31, 2016USD ($)$ / sharesshares |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | ||||||||||||
Stock split ratio | 3 | |||||||||||
Numerator: | ||||||||||||
Net earnings attributable to controlling interest | $ | $ 30,502 | $ 41,219 | $ 44,044 | $ 32,833 | $ 31,115 | $ 33,693 | $ 33,642 | $ 21,062 | $ 148,598 | $ 119,512 | $ 101,179 | |
Adjustment for earnings allocated to non-vested restricted common stock | $ | (3,396) | (2,225) | (1,595) | |||||||||
Net earnings for calculating EPS | $ | $ 145,202 | $ 117,287 | $ 99,584 | |||||||||
Denominator: | ||||||||||||
Weighted average shares outstanding (in shares) | 61,762 | 61,416 | 61,089 | |||||||||
Adjustment for non-vested restricted common stock (in shares) | (1,411) | (1,143) | (963) | |||||||||
Shares for calculating basic EPS (in shares) | 60,351 | 60,273 | 60,126 | |||||||||
Effect of dilutive restricted common stock (in shares) | 82 | 90 | 99 | |||||||||
Shares for calculating diluted EPS (in shares) | 60,433 | 60,363 | 60,225 | |||||||||
Net earnings per share | ||||||||||||
Basic (USD per share) | $ / shares | $ 0.50 | $ 0.67 | $ 0.71 | $ 0.53 | $ 0.51 | $ 0.55 | $ 0.55 | $ 0.34 | $ 2.41 | $ 1.95 | $ 1.66 | |
Diluted (USD per share) | $ / shares | $ 0.50 | $ 0.66 | $ 0.71 | $ 0.53 | $ 0.51 | $ 0.55 | $ 0.55 | $ 0.34 | $ 2.40 | $ 1.94 | $ 1.65 |
FAIR VALUE - Asset Measured at
FAIR VALUE - Asset Measured at Fair Value (Details) - Estimate of Fair Value Measurement - Recurring - USD ($) $ in Thousands | Dec. 29, 2018 | Dec. 30, 2017 |
Fair Value | ||
Investments at fair value | $ 33,600 | $ 22,938 |
Assets at fair value | 33,600 | 22,938 |
Money market funds | ||
Fair Value | ||
Investments at fair value | 5,323 | 3,135 |
Fixed Income | ||
Fair Value | ||
Investments at fair value | 13,125 | 8,156 |
Equity | ||
Fair Value | ||
Investments at fair value | 7,262 | 10,710 |
Hedge funds | ||
Fair Value | ||
Investments at fair value | 1,756 | |
Mutual Fund | ||
Fair Value | ||
Investments at fair value | 6,134 | 937 |
Domestic stock funds | ||
Fair Value | ||
Investments at fair value | 2,846 | 367 |
International stock funds | ||
Fair Value | ||
Investments at fair value | 937 | 91 |
Target funds | ||
Fair Value | ||
Investments at fair value | 237 | 270 |
Bond funds | ||
Fair Value | ||
Investments at fair value | 796 | 209 |
Alternative funds | ||
Fair Value | ||
Investments at fair value | 1,318 | |
Quoted Prices in Active Markets (Level 1) | ||
Fair Value | ||
Investments at fair value | 16,839 | 12,893 |
Assets at fair value | 16,839 | 12,893 |
Quoted Prices in Active Markets (Level 1) | Money market funds | ||
Fair Value | ||
Investments at fair value | 56 | 64 |
Quoted Prices in Active Markets (Level 1) | Fixed Income | ||
Fair Value | ||
Investments at fair value | 3,387 | 1,182 |
Quoted Prices in Active Markets (Level 1) | Equity | ||
Fair Value | ||
Investments at fair value | 7,262 | 10,710 |
Quoted Prices in Active Markets (Level 1) | Mutual Fund | ||
Fair Value | ||
Investments at fair value | 6,134 | 937 |
Quoted Prices in Active Markets (Level 1) | Domestic stock funds | ||
Fair Value | ||
Investments at fair value | 2,846 | 367 |
Quoted Prices in Active Markets (Level 1) | International stock funds | ||
Fair Value | ||
Investments at fair value | 937 | 91 |
Quoted Prices in Active Markets (Level 1) | Target funds | ||
Fair Value | ||
Investments at fair value | 237 | 270 |
Quoted Prices in Active Markets (Level 1) | Bond funds | ||
Fair Value | ||
Investments at fair value | 796 | 209 |
Quoted Prices in Active Markets (Level 1) | Alternative funds | ||
Fair Value | ||
Investments at fair value | 1,318 | |
Prices with Other Observable Inputs (Level 2) | ||
Fair Value | ||
Investments at fair value | 15,005 | 10,045 |
Assets at fair value | 15,005 | 10,045 |
Prices with Other Observable Inputs (Level 2) | Money market funds | ||
Fair Value | ||
Investments at fair value | 5,267 | 3,071 |
Prices with Other Observable Inputs (Level 2) | Fixed Income | ||
Fair Value | ||
Investments at fair value | 9,738 | $ 6,974 |
Prices with Unobservable Inputs (Level 3) | ||
Fair Value | ||
Investments at fair value | 1,756 | |
Assets at fair value | 1,756 | |
Prices with Unobservable Inputs (Level 3) | Hedge funds | ||
Fair Value | ||
Investments at fair value | $ 1,756 |
FAIR VALUE - Available for Sale
FAIR VALUE - Available for Sale Investment Portfolio (Details) - Ardellis Insurance Ltd. - USD ($) $ in Thousands | Dec. 29, 2018 | Dec. 30, 2017 |
Available-for-sale securities | ||
Total Securities Cost | $ 27,979 | $ 17,355 |
Unrealized Gain (Loss) | (588) | 1,510 |
Total Fair Value | 27,391 | 18,865 |
Fixed Income | ||
Available-for-sale securities | ||
Debt Securities Cost | 13,301 | 8,170 |
Debt Securities Unrealized Gain/(Loss) | (176) | (14) |
Debt Securities Fair Value | 13,125 | 8,156 |
Equity | ||
Available-for-sale securities | ||
Equity Securities Cost | 7,141 | 9,185 |
Equity Securities Unrealized Gain/(Loss) | 121 | 1,524 |
Equity Securities Fair Value | 7,262 | $ 10,709 |
Mutual Fund | ||
Available-for-sale securities | ||
Debt Securities Cost | 5,815 | |
Debt Securities Unrealized Gain/(Loss) | (567) | |
Debt Securities Fair Value | 5,248 | |
Hedge funds | ||
Available-for-sale securities | ||
Debt Securities Cost | 1,722 | |
Debt Securities Unrealized Gain/(Loss) | 34 | |
Debt Securities Fair Value | $ 1,756 |
BUSINESS COMBINATIONS (Details)
BUSINESS COMBINATIONS (Details) - USD ($) $ in Thousands | Oct. 22, 2018 | Jul. 31, 2018 | Jun. 01, 2018 | Apr. 09, 2018 | Apr. 03, 2018 | Jan. 23, 2018 | Jan. 15, 2018 | Oct. 16, 2017 | May 26, 2017 | Mar. 06, 2017 | Dec. 29, 2018 |
Business Acquisition | |||||||||||
Aggregate acquisitions' revenue | $ 110,100 | ||||||||||
Aggregate acquisitions' operating profit | $ 1,100 | ||||||||||
Pak-Rite | North | |||||||||||
Business Acquisition | |||||||||||
Purchase Price | $ 15,115 | ||||||||||
Percentage of assets purchased (as a percent) | 100.00% | ||||||||||
Intangible Assets | $ 8,592 | ||||||||||
Net Tangible Assets | 6,523 | ||||||||||
Acquired entity, prior year sales | $ 15,000 | ||||||||||
Pallet Place | West | |||||||||||
Business Acquisition | |||||||||||
Purchase Price | $ 1,016 | ||||||||||
Percentage of assets purchased (as a percent) | 100.00% | ||||||||||
Intangible Assets | $ 250 | ||||||||||
Net Tangible Assets | 766 | ||||||||||
Acquired entity, prior year sales | $ 5,000 | ||||||||||
North American Container Corporation | South | |||||||||||
Business Acquisition | |||||||||||
Purchase Price | $ 23,866 | ||||||||||
Percentage of assets purchased (as a percent) | 100.00% | ||||||||||
Intangible Assets | $ 12,497 | ||||||||||
Net Tangible Assets | 11,369 | ||||||||||
Acquired entity, prior year sales | $ 71,000 | ||||||||||
Fontana Wood Products | West | |||||||||||
Business Acquisition | |||||||||||
Purchase Price | $ 3,890 | ||||||||||
Percentage of assets purchased (as a percent) | 100.00% | ||||||||||
Intangible Assets | $ 2,235 | ||||||||||
Net Tangible Assets | 1,655 | ||||||||||
Acquired entity, prior year sales | $ 12,000 | ||||||||||
Expert Packaging | All Other | |||||||||||
Business Acquisition | |||||||||||
Purchase Price | $ 1,347 | ||||||||||
Percentage of assets purchased (as a percent) | 100.00% | ||||||||||
Intangible Assets | $ 1,287 | ||||||||||
Net Tangible Assets | 60 | ||||||||||
Acquired entity, prior year sales | $ 3,600 | ||||||||||
Spinner Wood Products, LLC | West | |||||||||||
Business Acquisition | |||||||||||
Purchase Price | $ 2,942 | ||||||||||
Percentage of assets purchased (as a percent) | 100.00% | ||||||||||
Intangible Assets | $ 850 | ||||||||||
Net Tangible Assets | 2,092 | ||||||||||
Acquired entity, prior year sales | $ 8,000 | ||||||||||
Great Northern Lumber, LLC | North | |||||||||||
Business Acquisition | |||||||||||
Purchase Price | $ 5,784 | ||||||||||
Percentage of assets purchased (as a percent) | 100.00% | ||||||||||
Intangible Assets | $ 50 | ||||||||||
Net Tangible Assets | 5,734 | ||||||||||
Acquired entity, prior year sales | $ 25,000 | ||||||||||
Silverwater Box | All Other | |||||||||||
Business Acquisition | |||||||||||
Purchase Price | $ 931 | ||||||||||
Percentage of assets purchased (as a percent) | 100.00% | ||||||||||
Intangible Assets | $ 909 | ||||||||||
Net Tangible Assets | 22 | ||||||||||
Acquired entity, prior year sales | $ 2,800 | ||||||||||
Go Boy Pallets LLC (Go Boy) | South | |||||||||||
Business Acquisition | |||||||||||
Purchase Price | $ 5,042 | ||||||||||
Percentage of assets purchased (as a percent) | 100.00% | ||||||||||
Intangible Assets | $ 4,880 | ||||||||||
Net Tangible Assets | 162 | ||||||||||
Acquired entity, prior year sales | $ 8,000 | ||||||||||
Robbins Manufacturing Co. (Robbins) | South | |||||||||||
Business Acquisition | |||||||||||
Purchase Price | $ 31,818 | ||||||||||
Percentage of assets purchased (as a percent) | 100.00% | ||||||||||
Intangible Assets | $ 7,653 | ||||||||||
Net Tangible Assets | 24,165 | ||||||||||
Acquired entity, prior year sales | 86,000 | ||||||||||
Quality Hardwood Sales, LLC (Quality) | North | |||||||||||
Business Acquisition | |||||||||||
Purchase Price | $ 22,789 | ||||||||||
Percentage of assets purchased (as a percent) | 100.00% | ||||||||||
Intangible Assets | $ 14,341 | ||||||||||
Net Tangible Assets | 8,448 | ||||||||||
Acquired entity, prior year sales | $ 30,000 |
BUSINESS COMBINATIONS - Acquire
BUSINESS COMBINATIONS - Acquired Intangible Assets (Details) - USD ($) $ in Thousands | Dec. 29, 2018 | Dec. 30, 2017 | Dec. 31, 2016 |
Business Acquisition | |||
GOODWILL | $ 224,117 | $ 212,644 | $ 198,535 |
Pak-Rite | |||
Business Acquisition | |||
GOODWILL | 4,292 | ||
Goodwill - Tax Deductible | 8,592 | ||
Pallet Place | |||
Business Acquisition | |||
Goodwill - Tax Deductible | 250 | ||
North American Container Corporation | |||
Business Acquisition | |||
GOODWILL | 8,997 | ||
Goodwill - Tax Deductible | 12,497 | ||
Fontana Wood Products | |||
Business Acquisition | |||
Goodwill - Tax Deductible | 2,235 | ||
Spinner Wood Products, LLC | |||
Business Acquisition | |||
Goodwill - Tax Deductible | 850 | ||
Great Northern Lumber, LLC | |||
Business Acquisition | |||
Goodwill - Tax Deductible | 50 | ||
Silverwater Box | |||
Business Acquisition | |||
GOODWILL | 909 | ||
Go Boy Pallets LLC (Go Boy) | |||
Business Acquisition | |||
Goodwill - Tax Deductible | 4,880 | ||
Robbins Manufacturing Co. (Robbins) | |||
Business Acquisition | |||
GOODWILL | 3,113 | ||
Goodwill - Tax Deductible | 7,653 | ||
Quality Hardwood Sales, LLC (Quality) | |||
Business Acquisition | |||
GOODWILL | 7,391 | ||
Goodwill - Tax Deductible | 14,341 | ||
Non-compete agreements | Expert Packaging | |||
Business Acquisition | |||
Intangible assets other than goodwill | 221 | ||
Non-compete agreements | Spinner Wood Products, LLC | |||
Business Acquisition | |||
Intangible assets other than goodwill | 850 | ||
Non-compete agreements | Great Northern Lumber, LLC | |||
Business Acquisition | |||
Intangible assets other than goodwill | 50 | ||
Non-compete agreements | Go Boy Pallets LLC (Go Boy) | |||
Business Acquisition | |||
Intangible assets other than goodwill | 225 | ||
Non-compete agreements | Robbins Manufacturing Co. (Robbins) | |||
Business Acquisition | |||
Intangible assets other than goodwill | 560 | ||
Non-compete agreements | Quality Hardwood Sales, LLC (Quality) | |||
Business Acquisition | |||
Intangible assets other than goodwill | 830 | ||
Customer relationships | Pak-Rite | |||
Business Acquisition | |||
Intangible assets other than goodwill | 4,300 | ||
Customer relationships | Pallet Place | |||
Business Acquisition | |||
Intangible assets other than goodwill | 250 | ||
Customer relationships | North American Container Corporation | |||
Business Acquisition | |||
Intangible assets other than goodwill | 3,500 | ||
Customer relationships | Fontana Wood Products | |||
Business Acquisition | |||
Intangible assets other than goodwill | 2,235 | ||
Customer relationships | Expert Packaging | |||
Business Acquisition | |||
Intangible assets other than goodwill | 809 | ||
Customer relationships | Go Boy Pallets LLC (Go Boy) | |||
Business Acquisition | |||
Intangible assets other than goodwill | 4,655 | ||
Customer relationships | Robbins Manufacturing Co. (Robbins) | |||
Business Acquisition | |||
Intangible assets other than goodwill | 3,530 | ||
Customer relationships | Quality Hardwood Sales, LLC (Quality) | |||
Business Acquisition | |||
Intangible assets other than goodwill | 5,720 | ||
Tradename | Expert Packaging | |||
Business Acquisition | |||
Intangible assets other than goodwill | 257 | ||
Tradename | Robbins Manufacturing Co. (Robbins) | |||
Business Acquisition | |||
Intangible assets other than goodwill | 450 | ||
Tradename | Quality Hardwood Sales, LLC (Quality) | |||
Business Acquisition | |||
Intangible assets other than goodwill | $ 400 |
GOODWILL AND OTHER INTANGIBLE_3
GOODWILL AND OTHER INTANGIBLE ASSETS (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 29, 2018 | Dec. 30, 2017 | Dec. 31, 2016 | |
GOODWILL AND OTHER INTANGIBLE ASSETS | |||
Indefinite-lived intangible assets | $ 7,360 | $ 7,415 | |
Amortization of intangibles | $ 6,393 | $ 4,860 | $ 2,795 |
GOODWILL AND OTHER INTANGIBLE_4
GOODWILL AND OTHER INTANGIBLE ASSETS - Goodwill by Reporting Segment (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 29, 2018 | Dec. 30, 2017 | |
Goodwill | ||
Goodwill, Beginning Balance | $ 212,644 | $ 198,535 |
Acquisitions | 13,288 | 11,413 |
Foreign Exchange, Net | (1,815) | 2,696 |
Goodwill, Ending Balance | 224,117 | 212,644 |
North | ||
Goodwill | ||
Goodwill, Beginning Balance | 51,127 | 43,386 |
Acquisitions | 4,292 | 7,391 |
Foreign Exchange, Net | (365) | 350 |
Goodwill, Ending Balance | 55,054 | 51,127 |
South | ||
Goodwill | ||
Goodwill, Beginning Balance | 46,738 | 43,625 |
Acquisitions | 8,996 | 3,113 |
Goodwill, Ending Balance | 55,734 | 46,738 |
West | ||
Goodwill | ||
Goodwill, Beginning Balance | 87,730 | 87,730 |
Goodwill, Ending Balance | 87,730 | 87,730 |
All Other | ||
Goodwill | ||
Goodwill, Beginning Balance | 27,049 | 23,794 |
Acquisitions | 909 | |
Foreign Exchange, Net | (1,450) | 2,346 |
Goodwill, Ending Balance | $ 25,599 | $ 27,049 |
GOODWILL AND OTHER INTANGIBLE_5
GOODWILL AND OTHER INTANGIBLE ASSETS - Included in Other Amortizable Intangible Assets (Details) - USD ($) $ in Thousands | Dec. 29, 2018 | Dec. 30, 2017 |
Finite-Lived Intangible Assets | ||
Assets | $ 58,799 | $ 49,272 |
Accumulated Amortization | (17,313) | (14,362) |
Non-compete agreements | ||
Finite-Lived Intangible Assets | ||
Assets | 10,232 | 9,841 |
Accumulated Amortization | (5,517) | (4,208) |
Customer relationships | ||
Finite-Lived Intangible Assets | ||
Assets | 40,307 | 31,630 |
Accumulated Amortization | (6,843) | (5,986) |
Licensing agreements | ||
Finite-Lived Intangible Assets | ||
Assets | 4,589 | 4,589 |
Accumulated Amortization | (3,909) | (3,450) |
Patents | ||
Finite-Lived Intangible Assets | ||
Assets | 792 | 792 |
Accumulated Amortization | (284) | (254) |
Tradename | ||
Finite-Lived Intangible Assets | ||
Assets | 2,879 | 2,420 |
Accumulated Amortization | $ (760) | $ (464) |
GOODWILL AND OTHER INTANGIBLE_6
GOODWILL AND OTHER INTANGIBLE ASSETS - Estimated Useful Lives of Intangible Assets (Details) | 12 Months Ended |
Dec. 29, 2018 | |
Non-compete agreements | |
Acquired Finite-Lived Intangible Assets | |
Weighted average amortization period | 6 years 9 months 18 days |
Customer relationships | |
Acquired Finite-Lived Intangible Assets | |
Weighted average amortization period | 11 years 4 months 24 days |
Licensing agreements | |
Acquired Finite-Lived Intangible Assets | |
Estimated useful life | 10 years |
Weighted average amortization period | 10 years |
Tradename | |
Acquired Finite-Lived Intangible Assets | |
Weighted average amortization period | 11 years 8 months 12 days |
Minimum | Non-compete agreements | |
Acquired Finite-Lived Intangible Assets | |
Estimated useful life | 3 years |
Minimum | Customer relationships | |
Acquired Finite-Lived Intangible Assets | |
Estimated useful life | 5 years |
Minimum | Tradename | |
Acquired Finite-Lived Intangible Assets | |
Estimated useful life | 5 years |
Maximum | Non-compete agreements | |
Acquired Finite-Lived Intangible Assets | |
Estimated useful life | 15 years |
Maximum | Customer relationships | |
Acquired Finite-Lived Intangible Assets | |
Estimated useful life | 15 years |
Maximum | Tradename | |
Acquired Finite-Lived Intangible Assets | |
Estimated useful life | 15 years |
GOODWILL AND OTHER INTANGIBLE_7
GOODWILL AND OTHER INTANGIBLE ASSETS - Estimated Amortization Expense for Intangibles (Details) - USD ($) $ in Thousands | Dec. 29, 2018 | Dec. 30, 2017 |
Finite-Lived Intangible Assets, Net, Amortization Expense, Fiscal Year Maturity | ||
2,019 | $ 6,908 | |
2,020 | 5,802 | |
2,021 | 5,503 | |
2,022 | 5,119 | |
2,023 | 3,800 | |
Thereafter | 14,354 | |
Finite-Lived Intangible Assets, Net, Total | $ 41,486 | $ 34,910 |
DEBT - Narrative (Details)
DEBT - Narrative (Details) - USD ($) $ in Millions | Nov. 01, 2018 | Dec. 29, 2018 | Oct. 31, 2018 | Jun. 14, 2018 | Dec. 30, 2017 | Dec. 17, 2012 |
Debt | ||||||
Outstanding letters of credit | $ 30.3 | $ 26.5 | ||||
Fair value of long-term debt including current portion | 203.1 | |||||
Difference between fair value and carrying value of debt | 0.6 | |||||
Revolving Credit Facility | ||||||
Debt | ||||||
Term of debt | 5 years | |||||
Maximum borrowing capacity | $ 375 | 375 | $ 295 | |||
Outstanding letters of credit | 40 | |||||
Outstanding letters of credit that can be converted to foreign currency | $ 100 | |||||
Remaining borrowing capacity | $ 322.7 | $ 225.7 | ||||
Revolving Credit Facility | Minimum | ||||||
Debt | ||||||
Facility fee (in hundredths) | 0.125% | |||||
Revolving Credit Facility | Maximum | ||||||
Debt | ||||||
Facility fee (in hundredths) | 0.30% | |||||
Series 2018 C Senior Notes | Senior Notes | ||||||
Debt | ||||||
Interest rate (in hundredths) | 4.20% | 4.20% | ||||
Debt | $ 40 | |||||
Series 2018 D Senior Notes | Senior Notes | ||||||
Debt | ||||||
Interest rate (in hundredths) | 4.27% | 4.27% | ||||
Debt | $ 35 | |||||
Series 2012 Senior Notes Tranche A | Senior Notes | ||||||
Debt | ||||||
Interest rate (in hundredths) | 3.89% | 3.89% | ||||
Debt | $ 35 | |||||
Series 2012 Senior Notes Tranche B | Senior Notes | ||||||
Debt | ||||||
Interest rate (in hundredths) | 3.98% | 3.98% | ||||
Debt | $ 40 | |||||
Series 2002-A Senior Notes Tranche B | Corporate Debt Securities | ||||||
Debt | ||||||
Debt | $ 40 | |||||
Shelf Agreement | ||||||
Debt | ||||||
Remaining borrowing capacity | $ 150 | |||||
Letter of Credit | ||||||
Debt | ||||||
Interest rate (in hundredths) | 0.75% | |||||
Term of debt | 1 year | |||||
Letter of Credit | Industrial Development Revenue Bonds | ||||||
Debt | ||||||
Outstanding letters of credit | $ 9.8 | |||||
Letter of Credit | Industrial Development Revenue Bonds | Minimum | ||||||
Debt | ||||||
Interest rate (in hundredths) | 1.125% |
DEBT - Long-term Debt Obligatio
DEBT - Long-term Debt Obligations (Details) - USD ($) $ in Thousands | Dec. 29, 2018 | Nov. 01, 2018 | Oct. 31, 2018 | Jun. 14, 2018 | Dec. 30, 2017 | Dec. 17, 2012 |
Debt | ||||||
Total | $ 202,501 | $ 146,180 | ||||
Less current portion | (148) | (1,329) | ||||
Less debt issuance costs | (223) | (177) | ||||
Long-term portion | 202,130 | 144,674 | ||||
Foreign Affiliate Debt | ||||||
Debt | ||||||
Total | 311 | 2,058 | ||||
Senior Notes | Series 2018 C Senior Notes | ||||||
Debt | ||||||
Total | $ 40,000 | |||||
Interest rate (in hundredths) | 4.20% | 4.20% | ||||
Senior Notes | Series 2018 D Senior Notes | ||||||
Debt | ||||||
Total | $ 35,000 | |||||
Interest rate (in hundredths) | 4.27% | 4.27% | ||||
Senior Notes | Series 2012 Senior Notes Tranche A | ||||||
Debt | ||||||
Total | $ 35,000 | 35,000 | ||||
Interest rate (in hundredths) | 3.89% | 3.89% | ||||
Senior Notes | Series 2012 Senior Notes Tranche B | ||||||
Debt | ||||||
Total | $ 40,000 | 40,000 | ||||
Interest rate (in hundredths) | 3.98% | 3.98% | ||||
Revolving Credit Facility | ||||||
Debt | ||||||
Total | $ 42,490 | $ 59,422 | ||||
Maximum borrowing capacity | $ 375,000 | $ 375,000 | $ 295,000 | |||
Interest rate at period end (in hundredths) | 3.39% | 2.41% | ||||
Corporate Debt Securities | Series 1999 Industrial Development Revenue Bonds | ||||||
Debt | ||||||
Total | $ 3,300 | $ 3,300 | ||||
Interest rate at period end (in hundredths) | 1.94% | 1.08% | ||||
Corporate Debt Securities | Series 2000 Industrial Development Revenue Bonds | ||||||
Debt | ||||||
Total | $ 2,700 | $ 2,700 | ||||
Interest rate at period end (in hundredths) | 2.00% | 1.14% | ||||
Corporate Debt Securities | Series 2002 Industrial Development Revenue Bonds | ||||||
Debt | ||||||
Total | $ 3,700 | $ 3,700 | ||||
Interest rate at period end (in hundredths) | 1.99% | 1.13% |
DEBT - Principal Maturities of
DEBT - Principal Maturities of Long-Term Debt and Capital Lease Obligations (Details) $ in Thousands | Dec. 29, 2018USD ($) |
Principal Maturities | |
2,019 | $ 148 |
2,020 | 2,834 |
2,021 | 29 |
2,022 | 38,700 |
2,023 | 42,490 |
Thereafter | 118,300 |
Total | $ 202,501 |
LEASES (Details)
LEASES (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 29, 2018 | Dec. 30, 2017 | Dec. 31, 2016 | |
Future minimum payments under non-cancelable operating leases [Abstract] | |||
2,019 | $ 17,242 | ||
2,020 | 11,969 | ||
2,021 | 9,784 | ||
2,022 | 8,346 | ||
2,023 | 6,382 | ||
Thereafter | 22,498 | ||
Total minimum lease payments | 76,221 | ||
Rent expense | $ 25,000 | $ 22,300 | $ 10,500 |
Minimum | |||
Operating Leased Assets | |||
Term of lease | 1 year | ||
Renewal options of lease | 5 years | ||
Minimum | Motor Vehicles, Equipment and Aircraft | |||
Operating Leased Assets | |||
Term of lease | 1 year | ||
Maximum | |||
Operating Leased Assets | |||
Term of lease | 10 years | ||
Renewal options of lease | 15 years | ||
Maximum | Motor Vehicles, Equipment and Aircraft | |||
Operating Leased Assets | |||
Term of lease | 10 years |
DEFERRED COMPENSATION (Details)
DEFERRED COMPENSATION (Details) - USD ($) $ in Millions | Dec. 29, 2018 | Dec. 30, 2017 |
Deferred compensation | ||
Liabilities related to Plan | $ 27.8 | $ 22.6 |
Other Liabilities | ||
Deferred compensation | ||
Deferred compensation liability | 2 | 2 |
Other Assets | ||
Deferred compensation | ||
Cash surrender value of life insurance | 2 | 2 |
Assets held by the Plan | $ 1 | $ 1 |
COMMON STOCK (Details)
COMMON STOCK (Details) $ in Millions | Nov. 14, 2017 | Dec. 29, 2018USD ($)shares | Dec. 30, 2017USD ($)itemshares | Dec. 31, 2016USD ($)shares | Oct. 14, 2010shares | Nov. 14, 2001shares |
Common stock | ||||||
Stock split ratio | 3 | |||||
Number of additional shares for each share held | item | 2 | |||||
Share-based compensation expense | $ 3.6 | $ 3.6 | $ 2.2 | |||
Income tax benefit from share-based compensation | 0.7 | 1 | 1.1 | |||
Cash received from option exercises and share issuances under plans | $ 1 | $ 0.7 | $ 0.5 | |||
Stock Repurchase Program [Abstract] | ||||||
Shares authorized for repurchase (in shares) | shares | 2,000,000 | 2,500,000 | ||||
Repurchase of shares (in shares) | shares | 860,669 | 445,740 | 13,613 | |||
Cumulative total authorized shares available for repurchase (in shares) | shares | 1,900,000 | |||||
Stock split ratio | 3 | |||||
Stock Purchase Plan | ||||||
Common stock | ||||||
Discount rate from fair market value on purchase date (in hundredths) | 85.00% | |||||
Stock Retainer Plan | ||||||
Common stock | ||||||
Multiplier of retainer fee (in hundredths) | 110.00% | |||||
Stock Retainer Plan expense | $ 1.7 | $ 1.7 | $ 0.7 | |||
Stock Options | ||||||
Common stock | ||||||
Unrecognized compensation expense of stock options | $ 0 | $ 0 | $ 0 |
COMMON STOCK - Common Stock Iss
COMMON STOCK - Common Stock Issuances (Details) - $ / shares | 12 Months Ended | ||
Dec. 29, 2018 | Dec. 30, 2017 | Dec. 31, 2016 | |
Common Stock | |||
Forfeitures | (5,000) | ||
Repurchase of common stock | (860,669) | (445,740) | (13,613) |
Stock Purchase Plan | |||
Common Stock | |||
Common stock issued | 38,000 | 24,000 | |
Average Share Price | |||
Common stock issued (dollars per share) | $ 35.58 | $ 32.80 | |
Stock Gift Program | |||
Common Stock | |||
Common stock issued | 3,000 | 3,000 | |
Average Share Price | |||
Common stock issued (dollars per share) | $ 33.56 | $ 31.92 | |
Stock Retainer Plan | |||
Common Stock | |||
Common stock issued | 101,000 | 62,000 | |
Average Share Price | |||
Common stock issued (dollars per share) | $ 17.17 | $ 19.02 | |
LTSIP | |||
Common Stock | |||
Common stock issued | 164,000 | 240,000 | |
Average Share Price | |||
Common stock issued (dollars per share) | $ 35.16 | $ 31.81 | |
Executive Stock Match Grants | |||
Common Stock | |||
Common stock issued | 94,000 | 129,000 | |
Average Share Price | |||
Common stock issued (dollars per share) | $ 32.94 | $ 32.03 | |
Deferred Compensation Plans | |||
Common Stock | |||
Common stock issued | 167,000 | 159,000 | |
Average Share Price | |||
Common stock issued (dollars per share) | $ 36.98 | $ 32.16 | |
Stock grant programs | |||
Common Stock | |||
Forfeitures | (14,000) | ||
Common stock issued, net of forfeitures | 348,000 | 429,000 | |
Average Share Price | |||
Common stock issued (dollars per share) | $ 29.37 | $ 30.06 |
COMMON STOCK - Nonvested Restri
COMMON STOCK - Nonvested Restricted Shares Awards (Details) - USD ($) $ / shares in Units, $ in Millions | 12 Months Ended | |||
Dec. 29, 2018 | Dec. 30, 2017 | Dec. 31, 2016 | Dec. 26, 2015 | |
Restricted Awards | ||||
Nonvested, beginning balance (in shares) | 1,033,626 | 791,532 | 623,748 | |
Granted (in shares) | 247,068 | 388,248 | 350,892 | |
Vested (in shares) | (107,865) | (141,111) | (180,465) | |
Forfeited (in shares) | (12,750) | (5,043) | (2,643) | |
Nonvested, ending balance (in shares) | 1,160,079 | 1,033,626 | 791,532 | 623,748 |
Weighted Average Grant Date Fair Value | ||||
Nonvested, beginning balance (in dollars per share) | $ 24.24 | $ 19.32 | $ 13.66 | |
Granted (in dollars per share) | 36.52 | 32.03 | 23.96 | |
Vested (in dollars per share) | 18.11 | 12.71 | 15.66 | |
Forfeited (in dollars per share) | 24.19 | 30.14 | 21.45 | |
Nonvested, ending balance (in dollars per share) | $ 23.32 | $ 24.24 | $ 19.32 | $ 13.66 |
Unrecognized Compensation Expense | ||||
Nonvested restricted awards, unrecognized compensation expense | $ 7.6 | $ 7.1 | $ 4.8 | $ 5.2 |
Nonvested restricted awards, weighted-average period to recognize expense | 1 year 1 month 13 days | 1 year 3 months 22 days | 1 year 6 months 4 days | 2 years 6 months 11 days |
RETIREMENT PLANS (Details)
RETIREMENT PLANS (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 29, 2018 | Dec. 30, 2017 | Dec. 31, 2016 | |
Defined Benefit Plan Disclosure [Line Items] | |||
Employer matching contribution, percent (in hundredths) | 25.00% | 25.00% | 25.00% |
Defined contribution plan, cost recognized | $ 3.4 | $ 4.8 | $ 4.4 |
Maximum annual contribution per employee (in hundredths) | 6.00% | ||
Number of years of service with the Company | 20 years | ||
Number of years of service with the Company as on officer | 10 years | ||
Percentage of officer's highest base salary (in hundredths) | 150.00% | ||
Years preceding separation from service | 3 years | ||
Other Liabilities | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Liabilities related to Plan | $ 9.1 | $ 7.8 |
INCOME TAXES - Components of In
INCOME TAXES - Components of Income Tax Expense (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 29, 2018 | Dec. 30, 2017 | Dec. 31, 2016 | |
Currently Payable: | |||
Federal | $ 31,492 | $ 44,413 | $ 42,397 |
State and local | 7,544 | 8,579 | 6,341 |
Foreign | 5,527 | 6,240 | 6,143 |
Total current payable | 44,563 | 59,232 | 54,881 |
Net Deferred: | |||
Federal | 2,965 | (7,681) | (455) |
State and local | (522) | (864) | 438 |
Foreign | (1,565) | 1,280 | 310 |
Total net deferred | 878 | (7,265) | 293 |
Income Tax Expense (Benefit), Total | $ 45,441 | $ 51,967 | $ 55,174 |
INCOME TAXES - Components of Ea
INCOME TAXES - Components of Earnings before Income Taxes (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 29, 2018 | Dec. 30, 2017 | Dec. 31, 2016 | |
Components of earnings before income taxes [Abstract] | |||
U.S. | $ 180,261 | $ 151,395 | $ 140,106 |
Foreign | 17,592 | 24,612 | 20,565 |
Total. | $ 197,853 | $ 176,007 | $ 160,671 |
INCOME TAXES - Effective Income
INCOME TAXES - Effective Income Tax Rate Reconciliation (Details) | 12 Months Ended | ||
Dec. 29, 2018 | Dec. 30, 2017 | Dec. 31, 2016 | |
Effective income tax rate reconciliation | |||
Statutory federal income tax rate | 21.00% | 35.00% | 35.00% |
State and local taxes (net of federal benefits) | 3.80% | 3.00% | 3.10% |
Effect of noncontrolling owned interest in earnings of partnerships | (0.10%) | (0.20%) | (0.20%) |
Manufacturing deduction | (2.50%) | (2.40%) | |
Tax credits, including foreign tax credit | (1.60%) | (2.00%) | (1.40%) |
Change in uncertain tax positions reserve | 0.10% | 0.40% | 0.40% |
Other permanent differences | 0.60% | (0.10%) | 0.10% |
Other, net | (0.70%) | (0.60%) | (0.30%) |
Impact of Tax Act and reduction of corporate tax rate | (0.10%) | (3.50%) | |
Effective income tax rate | 23.00% | 29.50% | 34.30% |
INCOME TAXES - Components of De
INCOME TAXES - Components of Deferred Tax Assets and Liabilities (Details) - USD ($) $ in Thousands | Dec. 29, 2018 | Dec. 30, 2017 |
Deferred Tax Assets | ||
Employee benefits | $ 20,914 | $ 17,048 |
Net operating loss carryforwards | 6,520 | 8,592 |
Foreign subsidiary capital loss carryforward | 504 | 546 |
Other tax credits | 586 | 709 |
Inventory | 1,090 | 358 |
Reserves on receivables | 802 | 714 |
Accrued expenses | 1,593 | 2,060 |
Other, net | 2,785 | 1,879 |
Gross deferred income tax assets | 34,794 | 31,906 |
Valuation allowance | (2,707) | (4,706) |
Deferred income tax assets | 32,087 | 27,200 |
Deferred Tax Liabilities | ||
Depreciation | (24,881) | (19,992) |
Intangibles | (20,225) | (19,422) |
Deferred income tax liabilities | (45,106) | (39,414) |
Net deferred income tax liability | $ (13,019) | $ (12,214) |
INCOME TAXES - NOL and Credit C
INCOME TAXES - NOL and Credit Carryforwards (Details) $ in Thousands | Dec. 29, 2018USD ($) |
U.S. | |
Operating Loss and Credit Carryforwards | |
Net Operating Losses | $ 2,900 |
U.S. | 2028 - 2032 | |
Operating Loss and Credit Carryforwards | |
Net Operating Losses | 2,859 |
U.S. | 2033 - 2037 | |
Operating Loss and Credit Carryforwards | |
Net Operating Losses | 41 |
State | |
Operating Loss and Credit Carryforwards | |
Net Operating Losses | 2,468 |
Tax Credits | 381 |
State | 2018 - 2022 | |
Operating Loss and Credit Carryforwards | |
Net Operating Losses | 165 |
Tax Credits | 381 |
State | 2023 - 2027 | |
Operating Loss and Credit Carryforwards | |
Net Operating Losses | 526 |
State | 2028 - 2032 | |
Operating Loss and Credit Carryforwards | |
Net Operating Losses | 672 |
State | 2033 - 2037 | |
Operating Loss and Credit Carryforwards | |
Net Operating Losses | 812 |
State | Thereafter | |
Operating Loss and Credit Carryforwards | |
Net Operating Losses | 293 |
Foreign | |
Operating Loss and Credit Carryforwards | |
Net Operating Losses | 1,152 |
Foreign | 2018 - 2022 | |
Operating Loss and Credit Carryforwards | |
Net Operating Losses | 347 |
Foreign | 2023 - 2027 | |
Operating Loss and Credit Carryforwards | |
Net Operating Losses | 635 |
Foreign | 2028 - 2032 | |
Operating Loss and Credit Carryforwards | |
Net Operating Losses | 114 |
Foreign | Thereafter | |
Operating Loss and Credit Carryforwards | |
Net Operating Losses | 56 |
Federal, state and foreign | |
Operating Loss and Credit Carryforwards | |
Net Operating Losses | 6,500 |
Capital Loss Carryforward | |
Operating Loss and Credit Carryforwards | |
Tax credit carryforward, valuation allowance | 400 |
Wholly-owned subsidiary | Capital Loss Carryforward | |
Operating Loss and Credit Carryforwards | |
Tax credit carryforward, valuation allowance | $ 500 |
INCOME TAXES - Income tax refor
INCOME TAXES - Income tax reforms (Details) - USD ($) $ in Millions | Dec. 22, 2017 | Dec. 29, 2018 | Dec. 30, 2017 |
Provisional Effect of Tax Cuts and Jobs Act of 2017 | |||
Period of time to pay one-time transition tax (in years) | 8 years | ||
Discrete net tax benefit | $ 6.1 | ||
Net benefit for the corporate rate reduction | 8.2 | ||
Net expense for write-down of deferred tax assets for stock based compensation | 1.9 | ||
Net expense for the transition tax | $ 0.2 | ||
Additional measurement period adjustment | $ 0.3 | ||
Adjusted total impact | 6.4 | ||
Net benefit for the corporate rate reduction | 8.2 | ||
Net expense for write-down of deferred tax assets for stock based compensation | 1.8 | ||
Net expense write-down of deferred tax assets for stock based compensation | (0.1) | ||
Net expense for the transition tax | $ (0.2) | ||
Effect of measurement-period adjustment | 0.10% |
ACCOUNTING FOR UNCERTAINTY IN_3
ACCOUNTING FOR UNCERTAINTY IN INCOME TAXES (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 29, 2018 | Dec. 30, 2017 | Dec. 31, 2016 | |
Reconciliation of beginning and ending amount of unrecognized tax benefits [Roll Forward] | |||
Gross unrecognized tax benefits beginning of year | $ 4,000 | $ 3,381 | $ 2,209 |
Increase in tax positions for prior years | 4 | 243 | |
Decrease in tax positions for prior years | (366) | ||
Increase in tax positions due to acquisitions | 362 | ||
Increase in tax positions for current year | 1,326 | 1,107 | 905 |
Settlements with taxing authorities | (2) | (32) | |
Lapse in statute of limitations | (582) | (490) | (306) |
Gross unrecognized tax benefits end of year | 4,378 | 4,000 | 3,381 |
Income tax penalties and interest accrued | 500 | $ 700 | $ 600 |
Increase in unrecognized tax benefits is reasonably possible | $ 800 |
COMMITMENTS, CONTINGENCIES, A_2
COMMITMENTS, CONTINGENCIES, AND GUARANTEES (Details) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 29, 2018 | Dec. 30, 2017 | |
Long-term commitment | ||
Outstanding purchase commitments on capital projects | $ 14.3 | |
Surety Bonds and Letters of Credit | ||
Outstanding letters of credit | 30.3 | $ 26.5 |
Remediation reserves | ||
Estimated costs to complete future remediation efforts | 2.1 | $ 3 |
Open Projects | ||
Surety Bonds and Letters of Credit | ||
Payment and performance bonds outstanding | 21.1 | |
Completed Projects | ||
Surety Bonds and Letters of Credit | ||
Payment and performance bonds outstanding | 1 | |
Insurance Contracts | ||
Surety Bonds and Letters of Credit | ||
Outstanding letters of credit | 20.5 | |
Revenue Bonds | ||
Surety Bonds and Letters of Credit | ||
Outstanding letters of credit | 9.8 | |
Other Long-term Liabilities | ||
Remediation reserves | ||
Approximate identification and removal of contaminants costs | $ 0.1 |
SEGMENT REPORTING - NARRATIVE (
SEGMENT REPORTING - NARRATIVE (Details) - item | 12 Months Ended | ||
Dec. 29, 2018 | Dec. 30, 2017 | Dec. 31, 2016 | |
Concentration risk | |||
Number of markets in which the entity operates (in markets) | 3 | ||
Total Sales | Customer Concentration | Home Depot | |||
Concentration risk | |||
Percent of sales | 19.00% | 19.00% | 20.00% |
SEGMENT REPORTING (Details)
SEGMENT REPORTING (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 29, 2018 | Sep. 29, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 30, 2017 | Sep. 30, 2017 | Jul. 01, 2017 | Apr. 01, 2017 | Dec. 29, 2018 | Dec. 30, 2017 | Dec. 31, 2016 | |
Segment Reporting | |||||||||||
Net sales | $ 988,179 | $ 1,212,702 | $ 1,294,440 | $ 993,857 | $ 966,091 | $ 1,056,586 | $ 1,072,375 | $ 846,130 | $ 4,489,180 | $ 3,941,182 | $ 3,240,493 |
Interest expense (income) | 8,893 | 6,218 | 4,575 | ||||||||
Amortization expense | 6,393 | 4,860 | 2,795 | ||||||||
Depreciation | 54,949 | 48,536 | 40,823 | ||||||||
Segment operating profit (loss) | 207,263 | 181,469 | 164,438 | ||||||||
Segment assets | 1,647,548 | 1,464,677 | 1,647,548 | 1,464,677 | 1,292,058 | ||||||
Capital expenditures | 95,862 | 71,116 | 53,762 | ||||||||
Intersegment net sales | |||||||||||
Segment Reporting | |||||||||||
Net sales | 424,888 | 392,540 | 204,044 | ||||||||
Corporate | |||||||||||
Segment Reporting | |||||||||||
Interest expense (income) | 10,130 | 6,234 | 3,737 | ||||||||
Depreciation | 9,466 | 8,443 | 7,828 | ||||||||
Segment operating profit (loss) | (29,161) | (26,264) | (35,630) | ||||||||
Segment assets | 101,896 | 54,171 | 101,896 | 54,171 | 45,986 | ||||||
Capital expenditures | 3,665 | 2,727 | 11,604 | ||||||||
North | Operating Segments | |||||||||||
Segment Reporting | |||||||||||
Net sales | 1,279,459 | 1,133,656 | 1,000,426 | ||||||||
Interest expense (income) | 58 | 4 | 1 | ||||||||
Amortization expense | 830 | 559 | 115 | ||||||||
Depreciation | 12,062 | 10,511 | 8,948 | ||||||||
Segment operating profit (loss) | 66,239 | 61,326 | 59,408 | ||||||||
Segment assets | 386,483 | 351,270 | 386,483 | 351,270 | 302,009 | ||||||
Capital expenditures | 17,820 | 23,026 | 10,902 | ||||||||
North | Intersegment net sales | |||||||||||
Segment Reporting | |||||||||||
Net sales | 56,682 | 67,161 | 57,770 | ||||||||
South | Operating Segments | |||||||||||
Segment Reporting | |||||||||||
Net sales | 1,024,747 | 837,370 | 711,862 | ||||||||
Interest expense (income) | (6) | 160 | 307 | ||||||||
Amortization expense | 1,292 | 607 | |||||||||
Depreciation | 8,244 | 6,880 | 6,190 | ||||||||
Segment operating profit (loss) | 60,049 | 46,646 | 47,146 | ||||||||
Segment assets | 266,503 | 240,661 | 266,503 | 240,661 | 192,085 | ||||||
Capital expenditures | 9,185 | 12,286 | 5,571 | ||||||||
South | Intersegment net sales | |||||||||||
Segment Reporting | |||||||||||
Net sales | 76,297 | 74,566 | 38,641 | ||||||||
West | Operating Segments | |||||||||||
Segment Reporting | |||||||||||
Net sales | 1,599,274 | 1,417,924 | 1,251,093 | ||||||||
Interest expense (income) | 197 | 293 | 387 | ||||||||
Amortization expense | 1,998 | 1,723 | 1,858 | ||||||||
Depreciation | 14,836 | 14,116 | 13,326 | ||||||||
Segment operating profit (loss) | 103,357 | 82,465 | 76,875 | ||||||||
Segment assets | 496,939 | 462,311 | 496,939 | 462,311 | 438,674 | ||||||
Capital expenditures | 26,024 | 23,212 | 19,648 | ||||||||
West | Intersegment net sales | |||||||||||
Segment Reporting | |||||||||||
Net sales | 56,004 | 83,245 | 88,311 | ||||||||
All Other | Operating Segments | |||||||||||
Segment Reporting | |||||||||||
Net sales | 585,700 | 552,232 | 277,112 | ||||||||
Interest expense (income) | (1,486) | (473) | 143 | ||||||||
Amortization expense | 2,273 | 1,971 | 822 | ||||||||
Depreciation | 10,341 | 8,586 | 4,531 | ||||||||
Segment operating profit (loss) | 6,779 | 17,296 | 16,639 | ||||||||
Segment assets | $ 395,727 | $ 356,264 | 395,727 | 356,264 | 313,304 | ||||||
Capital expenditures | 39,168 | 9,865 | 6,037 | ||||||||
All Other | Intersegment net sales | |||||||||||
Segment Reporting | |||||||||||
Net sales | $ 235,905 | $ 167,568 | $ 19,322 |
SEGMENT REPORTING - Information
SEGMENT REPORTING - Information Regarding Principal Geographic Areas (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 29, 2018 | Sep. 29, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 30, 2017 | Sep. 30, 2017 | Jul. 01, 2017 | Apr. 01, 2017 | Dec. 29, 2018 | Dec. 30, 2017 | Dec. 31, 2016 | |
Revenues and Long-Lived Assets | |||||||||||
Net sales | $ 988,179 | $ 1,212,702 | $ 1,294,440 | $ 993,857 | $ 966,091 | $ 1,056,586 | $ 1,072,375 | $ 846,130 | $ 4,489,180 | $ 3,941,182 | $ 3,240,493 |
Long-Lived Tangible Assets | 376,638 | 344,356 | 376,638 | 344,356 | 306,468 | ||||||
United States | |||||||||||
Revenues and Long-Lived Assets | |||||||||||
Net sales | 4,382,356 | 3,821,366 | 3,162,331 | ||||||||
Long-Lived Tangible Assets | 342,326 | 313,976 | 342,326 | 313,976 | 280,362 | ||||||
Foreign | |||||||||||
Revenues and Long-Lived Assets | |||||||||||
Net sales | 106,824 | 119,816 | 78,162 | ||||||||
Long-Lived Tangible Assets | $ 34,312 | $ 30,380 | $ 34,312 | $ 30,380 | $ 26,106 |
SEGMENT REPORTING - Gross Sales
SEGMENT REPORTING - Gross Sales by Major Product Classification (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 29, 2018 | Sep. 29, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 30, 2017 | Sep. 30, 2017 | Jul. 01, 2017 | Apr. 01, 2017 | Dec. 29, 2018 | Dec. 30, 2017 | Dec. 31, 2016 | |
Revenue | |||||||||||
Total Gross Sales | $ 4,565,749 | $ 4,006,203 | $ 3,297,377 | ||||||||
Sales allowances | (76,569) | (65,021) | (56,884) | ||||||||
Net sales | $ 988,179 | $ 1,212,702 | $ 1,294,440 | $ 993,857 | $ 966,091 | $ 1,056,586 | $ 1,072,375 | $ 846,130 | 4,489,180 | 3,941,182 | 3,240,493 |
Value-Added Sales | |||||||||||
Revenue | |||||||||||
Total Gross Sales | 2,854,661 | 2,535,008 | 2,067,738 | ||||||||
Trusses - residential, modular and manufactured housing | |||||||||||
Revenue | |||||||||||
Total Gross Sales | 421,996 | 368,591 | 334,956 | ||||||||
Fencing | |||||||||||
Revenue | |||||||||||
Total Gross Sales | 179,037 | 187,905 | 176,668 | ||||||||
Decking and railing - composite, wood and other | |||||||||||
Revenue | |||||||||||
Total Gross Sales | 271,499 | 244,910 | 200,004 | ||||||||
Turn-key framing and installed sales | |||||||||||
Revenue | |||||||||||
Total Gross Sales | 151,260 | 149,520 | 141,474 | ||||||||
Industrial packaging and components | |||||||||||
Revenue | |||||||||||
Total Gross Sales | 581,622 | 471,262 | 391,610 | ||||||||
Engineered wood products (eg. LVL; i-joist) | |||||||||||
Revenue | |||||||||||
Total Gross Sales | 83,212 | 76,507 | 76,503 | ||||||||
In-store fixtures | |||||||||||
Revenue | |||||||||||
Total Gross Sales | 252,341 | 260,174 | 87,262 | ||||||||
Manufactured brite and other lumber | |||||||||||
Revenue | |||||||||||
Total Gross Sales | 102,333 | 78,638 | 68,517 | ||||||||
Wall panels | |||||||||||
Revenue | |||||||||||
Total Gross Sales | 69,889 | 61,226 | 53,279 | ||||||||
Outdoor DIY products (eg. stakes; landscape ties) | |||||||||||
Revenue | |||||||||||
Total Gross Sales | 124,907 | 110,327 | 106,284 | ||||||||
Construction and building materials (eg. door packages; drywall) | |||||||||||
Revenue | |||||||||||
Total Gross Sales | 305,374 | 265,048 | 204,732 | ||||||||
Lattice - plastic and wood | |||||||||||
Revenue | |||||||||||
Total Gross Sales | 48,614 | 48,736 | 50,556 | ||||||||
Manufactured brite and other panels | |||||||||||
Revenue | |||||||||||
Total Gross Sales | 97,314 | 75,742 | 60,753 | ||||||||
Siding, trim and moulding | |||||||||||
Revenue | |||||||||||
Total Gross Sales | 98,370 | 85,016 | 66,048 | ||||||||
Hardware | |||||||||||
Revenue | |||||||||||
Total Gross Sales | 24,662 | 21,218 | 20,713 | ||||||||
Manufactured treated lumber | |||||||||||
Revenue | |||||||||||
Total Gross Sales | 20,889 | 17,584 | 17,412 | ||||||||
Other | |||||||||||
Revenue | |||||||||||
Total Gross Sales | 21,342 | 12,604 | 10,967 | ||||||||
Commodity-Based Sales | |||||||||||
Revenue | |||||||||||
Total Gross Sales | 1,711,088 | 1,471,195 | 1,229,639 | ||||||||
Non-manufactured brite and other lumber | |||||||||||
Revenue | |||||||||||
Total Gross Sales | 718,456 | 576,374 | 469,042 | ||||||||
Non-manufactured treated lumber | |||||||||||
Revenue | |||||||||||
Total Gross Sales | 647,222 | 575,505 | 479,333 | ||||||||
Non-manufactured brite and other panels | |||||||||||
Revenue | |||||||||||
Total Gross Sales | 285,888 | 271,310 | 238,806 | ||||||||
Non-manufactured treated panels | |||||||||||
Revenue | |||||||||||
Total Gross Sales | 39,768 | 34,970 | 30,374 | ||||||||
Other | |||||||||||
Revenue | |||||||||||
Total Gross Sales | $ 19,754 | $ 13,036 | $ 12,084 |
QUARTERLY FINANCIAL INFORMATI_3
QUARTERLY FINANCIAL INFORMATION (UNAUDITED) (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 29, 2018 | Sep. 29, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 30, 2017 | Sep. 30, 2017 | Jul. 01, 2017 | Apr. 01, 2017 | Dec. 29, 2018 | Dec. 30, 2017 | Dec. 31, 2016 | |
Net sales | $ 988,179 | $ 1,212,702 | $ 1,294,440 | $ 993,857 | $ 966,091 | $ 1,056,586 | $ 1,072,375 | $ 846,130 | $ 4,489,180 | $ 3,941,182 | $ 3,240,493 |
Total Gross Sales | 4,565,749 | 4,006,203 | 3,297,377 | ||||||||
Gross profit | 137,643 | 158,673 | 165,689 | 130,889 | 129,159 | 144,687 | 148,240 | 120,740 | 592,894 | 542,826 | 474,590 |
NET EARNINGS | 31,633 | 42,068 | 45,130 | 33,582 | 33,162 | 34,669 | 34,574 | 21,634 | 152,412 | 124,040 | 105,497 |
Net earnings attributable to controlling interest | $ 30,502 | $ 41,219 | $ 44,044 | $ 32,833 | $ 31,115 | $ 33,693 | $ 33,642 | $ 21,062 | $ 148,598 | $ 119,512 | $ 101,179 |
EARNINGS PER SHARE - BASIC (USD per share) | $ 0.50 | $ 0.67 | $ 0.71 | $ 0.53 | $ 0.51 | $ 0.55 | $ 0.55 | $ 0.34 | $ 2.41 | $ 1.95 | $ 1.66 |
EARNINGS PER SHARE - DILUTED (USD per share) | $ 0.50 | $ 0.66 | $ 0.71 | $ 0.53 | $ 0.51 | $ 0.55 | $ 0.55 | $ 0.34 | $ 2.40 | $ 1.94 | $ 1.65 |
Minimum | |||||||||||
Length of fiscal quarter | 91 days | 91 days | |||||||||
Maximum | |||||||||||
Length of fiscal quarter | 98 days | 98 days |