Document and Entity Information
Document and Entity Information - shares | 3 Months Ended | |
Apr. 01, 2018 | Apr. 20, 2018 | |
Document Document And Entity Information [Abstract] | ||
Entity Registrant Name | SONOCO PRODUCTS CO | |
Entity Central Index Key | 91,767 | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Large Accelerated Filer | |
Document Type | 10-Q | |
Document Period End Date | Apr. 1, 2018 | |
Document Fiscal Year Focus | 2,018 | |
Trading Symbol | SON | |
Document Fiscal Period Focus | Q1 | |
Amendment Flag | false | |
Entity Common Stock, Shares Outstanding | 99,563,083 |
CONDENSED CONSOLIDATED BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS (unaudited) - USD ($) $ in Thousands | Apr. 01, 2018 | Dec. 31, 2017 | [1] |
Current Assets | |||
Cash and cash equivalents | $ 305,250 | $ 254,912 | |
Trade accounts receivable, net of allowances | 756,102 | 725,251 | |
Other receivables | 91,319 | 64,561 | |
Inventories: | |||
Finished and in process | 155,417 | 196,204 | |
Materials and supplies | 305,310 | 277,859 | |
Prepaid expenses | 50,638 | 44,849 | |
Total Current Assets | 1,664,036 | 1,563,636 | |
Property, Plant and Equipment, Net | 1,164,968 | 1,169,377 | |
Goodwill | 1,252,877 | 1,241,875 | |
Other Intangible Assets, Net | 321,768 | 331,295 | |
Deferred Income Taxes | 51,820 | 62,053 | |
Other Assets | 197,600 | 189,485 | |
Total Assets | 4,653,069 | 4,557,721 | |
Current Liabilities | |||
Payable to suppliers | 555,246 | 548,309 | |
Accrued expenses and other | 278,380 | 283,355 | |
Notes payable and current portion of long-term debt | 175,530 | 159,327 | |
Accrued taxes | 26,218 | 8,979 | |
Total Current Liabilities | 1,035,374 | 999,970 | |
Long-term Debt, Net of Current Portion | 1,289,045 | 1,288,002 | |
Pension and Other Postretirement Benefits | 349,819 | 355,187 | |
Deferred Income Taxes | 72,303 | 74,073 | |
Other Liabilities | 110,072 | 110,429 | |
Commitments and Contingencies | |||
Common stock, no par value | |||
Authorized 300,000 shares 99,563 and 99,414 shares issued and outstanding at April 1, 2018 and December 31, 2017, respectively | 7,175 | 7,175 | |
Capital in excess of stated value | 329,596 | 330,157 | |
Accumulated other comprehensive loss | (637,031) | (666,272) | |
Retained earnings | 2,072,423 | 2,036,006 | |
Total Sonoco Shareholders’ Equity | 1,772,163 | 1,707,066 | |
Noncontrolling Interests | 24,293 | 22,994 | |
Total Equity | 1,796,456 | 1,730,060 | |
Total Liabilities and Equity | $ 4,653,069 | $ 4,557,721 | |
[1] | The year-end condensed consolidated balance sheet data was derived from audited financial statements, but does not include all disclosures required by accounting principles generally accepted in the United States of America. |
CONDENSED CONSOLIDATED BALANCE3
CONDENSED CONSOLIDATED BALANCE SHEETS (unaudited) (Parenthetical) - shares | Apr. 01, 2018 | Dec. 31, 2017 |
Statement of Financial Position [Abstract] | ||
Common stock, shares authorized | 300,000,000 | 300,000,000 |
Common stock, shares issued | 99,563,000 | 99,414,000 |
Common stock, shares outstanding | 99,563,000 | 99,414,000 |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENTS OF INCOME (unaudited) - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | |
Apr. 01, 2018 | Apr. 02, 2017 | |
Income Statement [Abstract] | ||
Net sales | $ 1,304,187 | $ 1,172,324 |
Cost of sales | 1,053,585 | 949,345 |
Gross profit | 250,602 | 222,979 |
Selling, general and administrative expenses | 137,441 | 125,209 |
Restructuring/Asset impairment charges | 3,063 | 4,111 |
Operating profit | 110,098 | 93,659 |
Non-operating pension (income)/cost | (291) | 3,686 |
Interest expense | 14,795 | 13,085 |
Interest income | 1,440 | 1,027 |
Income before income taxes | 97,034 | 77,915 |
Provision for income taxes | 23,356 | 25,539 |
Income before equity in earnings of affiliates | 73,678 | 52,376 |
Equity in earnings of affiliates, net of tax | 1,247 | 1,954 |
Net income | 74,925 | 54,330 |
Net income attributable to noncontrolling interests | (870) | (597) |
Net income attributable to Sonoco | $ 74,055 | $ 53,733 |
Weighted average common shares outstanding: | ||
Basic (in shares) | 100,396 | 100,112 |
Diluted (in shares) | 100,896 | 100,980 |
Net income attributable to Sonoco: | ||
Basic (in usd per share) | $ 0.74 | $ 0.54 |
Diluted (in usd per share) | 0.73 | 0.53 |
Cash dividends (in usd per share) | $ 0.39 | $ 0.37 |
CONDENSED CONSOLIDATED STATEME5
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (unaudited) - USD ($) $ in Thousands | 3 Months Ended | |
Apr. 01, 2018 | Apr. 02, 2017 | |
Statement of Comprehensive Income [Abstract] | ||
Net income | $ 74,925 | $ 54,330 |
Other comprehensive income/(loss): | ||
Foreign currency translation adjustments | 22,983 | 30,836 |
Changes in defined benefit plans, net of tax | 5,817 | 11,299 |
Changes in derivative financial instruments, net of tax | 1,047 | (2,949) |
Other comprehensive income | 29,847 | 39,186 |
Comprehensive income | 104,772 | 93,516 |
Net income attributable to noncontrolling interests | (870) | (597) |
Other comprehensive (income) attributable to noncontrolling interests | (430) | (680) |
Comprehensive income attributable to Sonoco | $ 103,472 | $ 92,239 |
CONDENSED CONSOLIDATED STATEME6
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (unaudited) - USD ($) $ in Thousands | 3 Months Ended | ||
Apr. 01, 2018 | Apr. 02, 2017 | ||
Cash Flows from Operating Activities: | |||
Net income | $ 74,925 | $ 54,330 | |
Adjustments to reconcile net income to net cash provided by operating activities: | |||
Asset impairment | 162 | 337 | |
Depreciation, depletion and amortization | 58,068 | 49,008 | |
Share-based compensation expense | 3,048 | 3,026 | |
Equity in earnings of affiliates | (1,247) | (1,954) | |
Cash dividends from affiliated companies | 900 | 1,950 | |
Net gain on disposition of assets | (227) | (46) | |
Pension and postretirement plan expense | 8,492 | 12,353 | |
Pension and postretirement plan contributions | (18,724) | (43,557) | |
Net increase/(decrease) in deferred taxes | (1,669) | 463 | |
Change in assets and liabilities, net of effects from acquisitions, dispositions, and foreign currency adjustments: | |||
Trade accounts receivable | (19,346) | (10,002) | |
Inventories | (17,814) | (9,752) | |
Payable to suppliers | 10,267 | 14,684 | |
Prepaid expenses | (4,202) | (1,224) | |
Accrued expenses | (229) | (11,550) | |
Income taxes payable and other income tax items | 17,183 | 10,283 | |
Other assets and liabilities | 10,178 | (951) | |
Net cash provided by operating activities | 119,765 | 67,398 | |
Cash Flows from Investing Activities: | |||
Purchase of property, plant and equipment | (41,360) | (50,455) | |
Cost of acquisitions, net of cash acquired | 0 | (221,417) | |
Proceeds from the sale of assets | 5,352 | 1,481 | |
Investment in affiliates and other, net | 148 | 133 | |
Net cash used in investing activities | (35,860) | (270,258) | |
Cash Flows from Financing Activities: | |||
Proceeds from issuance of debt | 21,488 | 170,297 | |
Principal repayment of debt | (19,662) | (17,637) | |
Net change in commercial paper | 10,000 | 41,000 | |
Net (decrease)/increase in outstanding checks | (5,506) | 2,742 | |
Cash dividends | (38,829) | (36,840) | |
Shares acquired | (4,088) | (5,539) | |
Net cash provided by/(used in) financing activities | (36,597) | 154,023 | |
Effects of Exchange Rate Changes on Cash | 3,030 | 4,401 | |
Net Increase/(Decrease) in Cash and Cash Equivalents | 50,338 | (44,436) | |
Cash and cash equivalents at beginning of period | 254,912 | [1] | 257,226 |
Cash and cash equivalents at end of period | $ 305,250 | $ 212,790 | |
[1] | The year-end condensed consolidated balance sheet data was derived from audited financial statements, but does not include all disclosures required by accounting principles generally accepted in the United States of America. |
Basis of Interim Presentation
Basis of Interim Presentation | 3 Months Ended |
Apr. 01, 2018 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis of Interim Presentation | Basis of Interim Presentation In the opinion of the management of Sonoco Products Company (the “Company” or “Sonoco”), the accompanying unaudited condensed consolidated financial statements contain all adjustments (consisting of only normal recurring adjustments, unless otherwise stated) necessary to state fairly the consolidated financial position, results of operations and cash flows for the interim periods reported herein. Operating results for the three months ended April 1, 2018 , are not necessarily indicative of the results that may be expected for the year ending December 31, 2018. These condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and the notes thereto included in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2017 . With respect to the unaudited condensed consolidated financial information of the Company for the three -month periods ended April 1, 2018 and April 2, 2017 included in this Form 10-Q, PricewaterhouseCoopers LLP reported that they have applied limited procedures in accordance with professional standards for a review of such information. However, their separate report dated May 2, 2018 appearing herein, states that they did not audit and they do not express an opinion on that unaudited financial information. Accordingly, the degree of reliance on their report on such information should be restricted in light of the limited nature of the review procedures applied. PricewaterhouseCoopers LLP is not subject to the liability provisions of Section 11 of the Securities Act of 1933 for their report on the unaudited financial information because that report is not a “report” or a “part” of a registration statement prepared or certified by PricewaterhouseCoopers LLP within the meaning of Sections 7 and 11 of the Act. |
New Accounting Pronouncements
New Accounting Pronouncements | 3 Months Ended |
Apr. 01, 2018 | |
Accounting Changes and Error Corrections [Abstract] | |
New Accounting Pronouncements | New Accounting Pronouncements In August 2017, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) 2 017-12, "Derivatives and Hedging: Targeted Improvements to Accounting for Hedging Activities," which expands and refines hedge accounting for both financial and non-financial risk components, aligns the recognition and presentation of the effects of hedging instruments and hedge items in the financial statements, and includes certain targeted improvements to ease the application of current guidance related to the assessment of hedge effectiveness. The update to the standard is effective for periods beginning after December 15, 2018, with early adoption permitted in any interim period after issuance of this update. T he Company implemented this ASU effective January 1, 2018, and recorded a cumulative adjustment to retained earnings of $176 as of that date in order to remove previously recognized ineffectiveness losses on contracts outstanding as of the date of adoption. In March 2017, the FASB issued ASU 2017-07, “Improving the Presentation of Net Periodic Pension Cost and Net Periodic Postretirement Benefit Cost,” which requires an employer to report service cost in the same line item as other compensation costs arising from employees during the period. The other components of net benefit cost as defined are required to be presented separately from the service cost component and outside a subtotal of income from operations, if one is presented, or disclosed. This update also allows only the service cost component to be eligible for capitalization when applicable and is effective for periods beginning after December 15, 2017. The amendments are to be applied retrospectively for the presentation of the components of net benefit cost in the income statement and prospectively for the capitalization of the service cost component. T he Company implemented this ASU effective January 1, 2018, modifying its income statement presentation of the components of net benefit cost accordingly, including the retrospective application to previously reported results. As a result of the retrospective application, the amounts previously reported in "Cost of sales" and "Selling, general and administrative expenses" for the three months ended April 2, 2017 , were reduced by $2,757 and $929 , respectively, and "Operating profit" increased by $3,686 , in order to conform to the current presentation. No change was required to the Company's historical policy regarding the capitalization of such costs. In January 2017, the FASB issued ASU 2017-04, “Simplifying the Test for Goodwill Impairment,” eliminating the requirement to determine the fair value of individual assets and liabilities of a reporting unit to measure goodwill impairment. Under ASU 2017-04, goodwill impairment testing is performed by comparing the fair value of the reporting unit with its carrying amount and recognizing an impairment charge for the amount by which the carrying amount exceeds the reporting unit’s fair value. The new standard is effective for annual and interim goodwill impairment tests in fiscal years beginning after December 15, 2019, with early adoption permitted, and should be applied on a prospective basis. The Company elected early adoption of the standard effective January 1, 2018. Any future goodwill impairment, should it occur, will be determined in accordance with this ASU. In October 2016, the FASB issued ASU 2016-16, "Intra-Entity Transfers of Assets Other Than Inventory," which requires an entity to recognize the income tax consequences of an intra-entity transfer of an asset upon transfer other than inventory, eliminating the current recognition exception. Prior to this ASU, GAAP prohibited the recognition of current and deferred income taxes for intra-entity asset transfers until the asset was sold to an outside party. The recognition prohibition was an exception to the principle of comprehensive recognition of current and deferred income taxes in GAAP. This guidance became effective for the Company on January 1, 2018, and did not have a material effect on its consolidated financial statements. In August 2016, the FASB issued ASU 2016-15, " Classification of Certain Cash Receipts and Cash Payments ," providing clarification on eight cash flow classification issues, including 1) debt prepayment or debt extinguishment costs, 2) settlement of relatively insignificant debt instruments, 3) contingent consideration payments, 4) insurance claim settlements, 5) life insurance settlements, 6) distributions received from equity method investees, 7) beneficial interests in securitization transactions, and 8) separately identifiable cash flows. This guidance, which applies to both interim and annual periods, became effective for the Company on January 1, 2018. Adoption of this ASU did not have a material effect on the Company's consolidated financial statements in the periods ended April 1, 2018 and April 2, 2017, as the Company either did not realize any cash flows from these types of activities, such amounts were immaterial, or the prescribed guidance did not differ from its current practice. In March 2016, the FASB issued ASU 2016-08, "Revenue from Contracts with Customers, Principal versus Agent Considerations (Reporting Revenue Gross versus Net)," which provides guidance on recording revenue on a gross basis versus a net basis based on the determination of whether an entity is a principal or an agent when another party is involved in providing goods or services to a customer. The amendments in this update affect the guidance in ASU No. 2014-09 and are effective in the same time frame as ASU 2014-09 as discussed below. In February 2016, the FASB issued ASU 2016-02, "Leases" which changes accounting for leases and requires lessees to recognize the assets and liabilities arising from all leases, including those classified as operating leases under previous accounting guidance on the balance sheet and requires disclosure of key information about leasing arrangements to increase transparency and comparability among organizations. The accounting for lessors does not fundamentally change except for changes to conform and align guidance to the lessee guidance. The guidance is effective for reporting periods beginning after December 15, 2018, including interim periods within those fiscal years and requires retrospective application. The Company is still assessing the impact of ASU 2016-02 on its consolidated financial statements, but expects the adoption of this ASU to have a material impact on its consolidated balance sheet for the initial recognition of the right-of-use asset and lease liability associated with operating leases that are not currently recognized on the balance sheet under present U.S. GAAP. In May 2014, the FASB issued ASU 2014-09, "Revenue From Contracts With Customers," which changes the definitions/criteria used to determine when revenue should be recognized from being based on risks and rewards to being based on control. Among other changes, ASU 2014-09 changes the manner in which variable consideration is recognized, requires recognition of the time value of money when payment terms exceed one year, provides clarification on accounting for contract costs, and expands disclosure requirements. The Company adopted ASU 2014-09 in the first quarter of 2018 following the modified retrospective transition method and, as such, recorded a cumulative adjustment of $1,721 to beginning retained earnings for the period. The most significant impacts to the Company's financial statements from the adoption of this ASU are the acceleration of revenue recognition compared to prior standards for arrangements under which the Company is producing customer-specific products without alternative use and would be entitled to payment for work completed, including a reasonable margin, and the recognition of material customer contract rights for certain agreed-upon future price concessions. During the three -month period ended April 1, 2018 , there have been no other newly issued nor newly applicable accounting pronouncements that have had, or are expected to have, a material impact on the Company’s financial statements. Further, at April 1, 2018 , there were no other pronouncements pending adoption that are expected to have a material impact on the Company’s consolidated financial statements. |
Changes in Accounting Policy
Changes in Accounting Policy | 3 Months Ended |
Apr. 01, 2018 | |
Accounting Changes and Error Corrections [Abstract] | |
Changes in Accounting Policy | Changes in Accounting Policy Except for the changes below, the Company has consistently applied the accounting policies to all periods presented in these condensed consolidated financial statements. The Company adopted Topic 606, "Revenue from Contracts with Customers," effective January 1, 2018. As a result, the Company has changed its accounting policy for revenue recognition as detailed in Note 14. The Company applied Topic 606 using the cumulative effect method by recognizing the cumulative effect of initially applying Topic 606 as an adjustment to the opening balance of equity at January 1, 2018. Therefore, the comparative information has not been adjusted and continues to be reported under Topic 605. The details of the significant changes and quantitative impact of the changes are set out below. December 31, 2017 As Reported Adjustments January 1, 2018 Adjusted Assets Current Assets Trade accounts receivable, net of allowances 725,251 3,636 728,887 Other receivables 64,561 41,351 105,912 Inventories: Finished and in process 196,204 (37,447 ) 158,757 Total Assets $ 4,557,721 $ 7,540 $ 4,565,261 Liabilities and Equity Current Liabilities Accrued expenses and other 283,355 5,215 288,570 999,970 5,215 1,005,185 Deferred Income Taxes 74,073 604 74,677 Sonoco Shareholders’ Equity Retained earnings 2,036,006 1,721 2,037,727 Total Sonoco Shareholders’ Equity 1,707,066 1,721 1,708,787 Total Equity 1,730,060 1,721 1,731,781 Total Liabilities and Equity $ 4,557,721 $ 7,540 $ 4,565,261 The following table summarizes the impact of the adoption of Topic 606 on the Company's Condensed Consolidated Balance Sheet as of April 1, 2018 : April 1, 2018 As Reported Adjustments Balances without Adoption of Topic 606 Assets Current Assets Trade accounts receivable, net of allowances 756,102 (3,819 ) 752,283 Other receivables 91,319 (44,489 ) 46,830 Inventories: Finished and in process 155,417 40,070 195,487 Total Assets $ 4,653,069 $ (8,238 ) $ 4,644,831 Liabilities and Equity Current Liabilities Accrued expenses and other 278,380 (5,476 ) 272,904 1,035,374 (5,476 ) 1,029,898 Deferred Income Taxes 72,303 (718 ) 71,585 Sonoco Shareholders' Equity Retained earnings 2,072,423 (2,044 ) 2,070,379 Total Sonoco Shareholders’ Equity 1,772,163 (2,044 ) 1,770,119 Total Equity 1,796,456 (2,044 ) 1,794,412 Total Liabilities and Equity $ 4,653,069 $ (8,238 ) $ 4,644,831 The following table summarizes the impact of the adoption of Topic 606 on the Company's Condensed Consolidated Statement of Income for the three months ended April 1, 2018 : Three Months Ended April 1, 2018 As Reported Adjustments Balances without Adoption of Topic 606 Net sales $ 1,304,187 $ (3,060 ) $ 1,301,127 Cost of sales 1,053,585 (2,623 ) 1,050,962 Gross profit 250,602 (437 ) 250,165 Operating profit 110,098 (437 ) 109,661 Income before income taxes 97,034 (437 ) 96,597 Provision for income taxes 23,356 (114 ) 23,242 Income before equity in earnings of affiliates 73,678 (323 ) 73,355 Net income 74,925 (323 ) 74,602 Net income attributable to Sonoco $ 74,055 $ (323 ) $ 73,732 The following table summarizes the impact of the adoption of Topic 606 on the Company's Condensed Consolidated Statement of Comprehensive Income for the three months ended April 1, 2018 : Three Months Ended April 1, 2018 As Reported Adjustments Balances without Adoption of Topic 606 Net income $ 74,925 $ (323 ) $ 74,602 Comprehensive income 104,772 (323 ) 104,449 Comprehensive income attributable to Sonoco $ 103,472 $ (323 ) $ 103,149 The following table summarizes the impact of the adoption of Topic 606 on the Company's Condensed Consolidated Statement of Cash Flows for the three months ended April 1, 2018 : Three Months Ended April 1, 2018 As Reported Adjustments Balances without Adoption of Topic 606 Cash Flows from Operating Activities: Net income $ 74,925 $ (323 ) $ 74,602 Trade accounts receivable (19,346 ) 182 (19,164 ) Inventories (17,814 ) 516 (17,298 ) Accrued expenses (229 ) (261 ) (490 ) Income taxes payable and other income tax items 17,183 (114 ) 17,069 Net cash provided by operating activities 119,765 — 119,765 |
Acquisitions
Acquisitions | 3 Months Ended |
Apr. 01, 2018 | |
Business Combinations [Abstract] | |
Acquisitions | Acquisitions On April 12, 2018, subsequent to quarter end, the Company completed the acquisition of Highland Packaging Solutions ("Highland"). Total consideration for this acquisition was $150,000 , including cash paid at closing of $142,500 and a contingent purchase liability of $7,500 . Final consideration will also be subject to an adjustment for working capital, which is expected to be completed by the end of the third quarter of 2018. The contingent purchase liability is based upon a sales metric which the Company expects to meet and is payable in two installments. The first installment of $5,000 is to be paid one year after the closing date and the second installment of $2,500 is to be paid two years after the closing date. Highland manufactures thermoformed plastic packaging for fresh produce and dairy products from a single production facility in Plant City, Florida, providing total packaging solutions for customers that include sophisticated engineered containers, flexographic printed labels, and inventory management through distribution warehouses in the Southeast and West Coast of the United States. The Company financed the acquisition with proceeds from a new $100,000 term loan, along with proceeds from existing credit facilities. As the acquisition of Highland was completed subsequent to the end of the quarter, the preliminary assessment of the fair values of the assets acquired and liabilities assumed in connection with the acquisition has not been completed. Accordingly, such amounts cannot yet be provided. During the three-month period ended April 1, 2018 , the Company finalized its valuations of the assets and liabilities acquired in conjunction with the 2017 acquisition of Packaging Holdings, Inc. and subsidiaries, including Peninsula Packaging LLC ("Packaging Holdings"), based on information obtained about facts and circumstances that existed as of the acquisition date. As a result, measurement period adjustments were made to the previously disclosed provisional fair values of Packaging Holding's net assets that decreased deferred tax assets by $6,516 , increased long-term debt by $664 , and increased goodwill by $7,180 . The adjustments were primarily related to a reduction in the Company’s valuation of acquired tax loss carryforwards and the fair value of capital lease obligations. Acquisition-related costs of $545 and $4,325 were incurred during the three months ended April 1, 2018 and April 2, 2017 , respectively. Acquisition-related costs consist primarily of legal and professional fees and are included in "Selling, general and administrative expenses" in the Company's Condensed Consolidated Statements of Income. |
Shareholders' Equity
Shareholders' Equity | 3 Months Ended |
Apr. 01, 2018 | |
Equity [Abstract] | |
Shareholders' Equity | Shareholders' Equity Earnings per Share The following table sets forth the computation of basic and diluted earnings per share (dollars and shares in thousands, except per share data): Three Months Ended April 1, April 2, Numerator: Net income attributable to Sonoco $ 74,055 $ 53,733 Denominator: Weighted average common shares outstanding: Basic 100,396 100,112 Dilutive effect of stock-based compensation 500 868 Diluted 100,896 100,980 Net income attributable to Sonoco per common share: Basic $ 0.74 $ 0.54 Diluted $ 0.73 $ 0.53 Potentially dilutive securities are calculated in accordance with the treasury stock method, which assumes the proceeds from the exercise of all dilutive stock appreciation rights (SARs) are used to repurchase the Company’s common stock. Certain SARs are not dilutive because either the exercise price is greater than the average market price of the stock during the reporting period or assumed repurchases from proceeds from the exercise of the SARs were antidilutive. These SARs may become dilutive in the future if the market price of the Company's common stock appreciates. The average number of SARs that were not dilutive and therefore not included in the computation of diluted earnings per share during the three -month periods ended April 1, 2018 and April 2, 2017 was as follows (in thousands): Three Months Ended April 1, April 2, Anti-dilutive stock appreciation rights 738 356 No adjustments were made to net income attributable to Sonoco in the computations of earnings per share. Stock Repurchases On February 10, 2016, the Company’s Board of Directors authorized the repurchase of up to 5,000 shares of the Company's common stock. A total of 2,030 were purchased in 2016. No shares were repurchased under this authorization during 2017 or during the three months ended April 1, 2018 . Accordingly, a total of 2,970 shares remain available for repurchase at April 1, 2018 . The Company frequently repurchases shares of its common stock to satisfy employee tax withholding obligations in association with certain share-based compensation awards. These repurchases, which are not part of a publicly announced plan or program, totaled 78 shares in the three months ended April 1, 2018 at a cost of $4,088 , and 105 shares in the three months ended April 2, 2017 at a cost of $5,539 . Dividend Declarations On February 14, 2018 , the Board of Directors declared a regular quarterly dividend of $0.39 per share. This dividend was paid on March 9, 2018 to all shareholders of record as of February 28, 2018 . On April 18, 2018 , the Board of Directors declared a regular quarterly dividend of $0.41 per share. This dividend is payable on June 8, 2018 to all shareholders of record as of May 11, 2018 . |
Restructuring and Asset Impairm
Restructuring and Asset Impairment | 3 Months Ended |
Apr. 01, 2018 | |
Restructuring and Related Activities [Abstract] | |
Restructuring and Asset Impairment | Restructuring and Asset Impairment The Company has engaged in a number of restructuring actions over the past several years. Actions initiated in 2018 and 2017 are reported as “2018 Actions” and “2017 Actions,” respectively. Actions initiated prior to 2017, all of which were substantially complete at April 1, 2018 , are reported as “2016 and Earlier Actions.” Following are the total restructuring and asset impairment charges/(credits), net of adjustments, and gains on dispositions recognized by the Company during the periods presented: Three Months Ended April 1, 2018 April 2, 2017 Restructuring/Asset impairment: 2018 Actions $ 2,207 $ — 2017 Actions 405 2,304 2016 and Earlier Actions 451 1,807 Restructuring/Asset impairment charges $ 3,063 $ 4,111 Income tax benefit (685 ) (1,298 ) Less: Costs attributable to noncontrolling interests, net of tax (5 ) (2 ) Restructuring/asset impairment charges attributable to Sonoco, net of tax $ 2,373 $ 2,811 Pre-tax restructuring and asset impairment charges are included in “Restructuring/Asset impairment charges” in the Condensed Consolidated Statements of Income. When recognizable in accordance with GAAP, the Company expects to recognize future additional charges totaling approximately $1,800 in connection with previously announced restructuring actions. The Company believes that the majority of these charges will be incurred and paid by the end of 2018. The Company continually evaluates its cost structure, including its manufacturing capacity, and additional restructuring actions are likely to be undertaken. 2018 Actions During 2018, the Company announced the closure of a flexible packaging plant in North Carolina and a global brand management facility in Canada (both part of the Consumer Packaging segment), a tubes and cores plant in Alabama (part of the Paper and Industrial Converted Products segment), and a protective packaging plant in North Carolina (part of the Protective Solutions segment). In addition, approximately 20 positions were eliminated in the first quarter of 2018 in conjunction with the Company's ongoing organizational effectiveness efforts. Below is a summary of 2018 Actions and related expenses by segment and by type incurred and estimated to be incurred through completion. 2018 Actions First Quarter 2018 Estimated Severance and Termination Benefits Consumer Packaging $ 788 $ 938 Display and Packaging 175 175 Paper and Industrial Converted Products 991 991 Protective Solutions 259 259 Corporate 223 223 Asset Impairment / Disposal of Assets Consumer Packaging (14 ) (14 ) Protective Solutions (272 ) (272 ) Other Costs Consumer Packaging 11 311 Paper and Industrial Converted Products — 1,000 Protective Solutions 46 46 Total Charges and Adjustments $ 2,207 $ 3,657 The following table sets forth the activity in the 2018 Actions restructuring accrual included in “Accrued expenses and other” on the Company’s Condensed Consolidated Balance Sheets: 2018 Actions Severance Termination Asset Impairment/ Disposal Other Costs Total Accrual Activity Liability at December 31, 2017 $ — $ — $ — $ — 2018 charges 2,436 (286 ) 57 2,207 Cash receipts/(payments) (259 ) 2,049 (10 ) 1,780 Asset write downs/disposals — (1,763 ) — (1,763 ) Foreign currency translation (4 ) — — (4 ) Liability at April 1, 2018 $ 2,173 $ — $ 47 $ 2,220 Included in "Asset Impairment/Disposal of Assets" above is a net gain of $272 resulting from the sale of a building and land relating to the closure of a protective packaging plant in North Carolina. The Company received proceeds of $2,019 from the sale and wrote off assets of $1,747 . The Company expects to pay the majority of the remaining 2018 Actions restructuring costs by the end of 2018 using cash generated from operations. 2017 Actions During 2017, the Company announced the closure of an expanded foam protective packaging plant in the United States (part of the Protective Solutions segment) and five tubes and cores plants - three in the United States, one in Belgium, and one in China (all part of the Paper and Industrial Converted Products segment). In addition, approximately 255 positions were eliminated throughout 2017 in conjunction with the Company's ongoing organizational effectiveness efforts. Below is a summary of 2017 Actions and related expenses by segment and by type incurred and estimated to be incurred through completion. Three Months Ended Total Incurred Estimated 2017 Actions April 1, 2018 April 2, 2017 Severance and Termination Benefits Consumer Packaging $ 372 $ 967 $ 4,563 $ 4,763 Display and Packaging (8 ) 106 733 733 Paper and Industrial Converted Products 4 541 4,022 4,022 Protective Solutions 133 75 1,531 1,531 Corporate — 456 452 452 Asset Impairment / Disposal of Assets Consumer Packaging — — 351 351 Display and Packaging 166 — 166 166 Paper and Industrial Converted Products (665 ) — (760 ) (760 ) Protective Solutions — — 871 871 Other Costs Consumer Packaging 107 159 986 986 Display and Packaging (348 ) — 441 441 Paper and Industrial Converted Products 550 — 1,551 1,551 Protective Solutions 94 — 836 836 Corporate — — (9 ) (9 ) Total Charges and Adjustments $ 405 $ 2,304 $ 15,734 $ 15,934 The following table sets forth the activity in the 2017 Actions restructuring accrual included in “Accrued expenses and other” on the Company’s Condensed Consolidated Balance Sheets: 2017 Actions Severance Asset Other Total Accrual Activity 2018 Year to Date Liability at December 31, 2017 $ 3,889 $ — $ 213 $ 4,102 2018 charges 501 (499 ) 403 405 Cash payments (1,727 ) 1,023 (501 ) (1,205 ) Asset write downs/disposals — (524 ) — (524 ) Foreign currency translation 69 — 11 80 Liability at April 1, 2018 $ 2,732 $ — $ 126 $ 2,858 Included in "Asset Impairment/Disposal of Assets" above is a gain of $774 primarily related to the sale of a building and land from the closure of a tubes and cores plant in Iowa. The Company received proceeds of $1,023 and wrote off assets of $249 . “Other costs” consist primarily of costs related to plant closures including equipment removal, utilities, plant security, property taxes and insurance. The Company expects to pay the majority of the remaining 2017 Actions restructuring costs by the end of 2018 using cash generated from operations. 2016 and Earlier Actions 2016 and Earlier Actions are comprised of a number of plant closures and workforce reductions initiated prior to 2017. Charges for these actions in both 2018 and 2017 primarily relate to the cost of plant closures including severance, equipment removal, plant security, property taxes and insurance. The Company expects to recognize future pretax charges of approximately $100 associated with 2016 and Earlier Actions. Below is a summary of expenses/(income) incurred by segment for 2016 and Earlier Actions for the three -month periods ended April 1, 2018 and April 2, 2017 . 2018 2017 2016 and Earlier Actions First Quarter First Quarter Consumer Packaging $ 465 $ (26 ) Display and Packaging 1 395 Paper and Industrial Converted Products (33 ) 1,353 Protective Solutions 18 78 Corporate — 7 Total Charges and Adjustments $ 451 $ 1,807 The accrual for 2016 and Earlier Actions totaled $2,189 and $3,044 at April 1, 2018 and December 31, 2017 , respectively, and is included in “Accrued expenses and other” on the Company’s Condensed Consolidated Balance Sheets. The majority of the liability associated with 2016 and Earlier Actions relates to unpaid severance and building lease termination costs and is expected to be paid by the end of 2018 using cash generated from operations. |
Accumulated Other Comprehensive
Accumulated Other Comprehensive Loss | 3 Months Ended |
Apr. 01, 2018 | |
Equity [Abstract] | |
Accumulated Other Comprehensive Loss | Accumulated Other Comprehensive Loss The following table summarizes the components of accumulated other comprehensive loss and the changes in the balances of each component of accumulated other comprehensive loss, net of tax as applicable, for the three months ended April 1, 2018 and April 2, 2017 : Gains and Losses on Cash Flow Hedges Defined Benefit Pension Items Foreign Currency Items Accumulated Other Comprehensive Loss Balance at December 31, 2017 $ (641 ) $ (467,136 ) $ (198,495 ) $ (666,272 ) Other comprehensive income/(loss) before reclassifications 1,182 (1,145 ) 22,553 22,590 Amounts reclassified from accumulated other comprehensive loss to net income (180 ) 6,962 — 6,782 Amounts reclassified from accumulated other comprehensive loss to fixed assets 45 — — 45 Other comprehensive income/(loss) 1,047 5,817 22,553 29,417 Amounts reclassified from retained earnings to accumulated other comprehensive loss $ (176 ) $ — $ — (176 ) Balance at April 1, 2018 $ 230 $ (461,319 ) $ (175,942 ) $ (637,031 ) Balance at December 31, 2016 $ 1,939 $ (453,821 ) $ (286,498 ) $ (738,380 ) Other comprehensive income/(loss) before reclassifications (2,626 ) 4,924 30,156 32,454 Amounts reclassified from accumulated other comprehensive loss to net income (365 ) 6,375 — 6,010 Amounts reclassified from accumulated other comprehensive loss to fixed assets 42 — — 42 Other comprehensive income/(loss) (2,949 ) 11,299 30,156 38,506 Balance at April 2, 2017 $ (1,010 ) $ (442,522 ) $ (256,342 ) $ (699,874 ) "Other comprehensive income/(loss) before reclassifications" during the three months ended April 2, 2017 , includes $5,071 of "Defined Benefit Pension Items" related to the release of a portion of the valuation allowance on deferred tax assets related to the pension plan of a foreign subsidiary. The following table summarizes the effects on net income of significant amounts reclassified from each component of accumulated other comprehensive loss for the three -month periods ended April 1, 2018 and April 2, 2017 : Amount Reclassified from Accumulated Other Comprehensive Loss Three Months Ended Details about Accumulated Other Comprehensive Loss Components April 1, April 2, Affected Line Item in the Condensed Consolidated Statements of Income Gains and losses on cash flow hedges Foreign exchange contracts $ 810 $ 1,040 Net sales Foreign exchange contracts (527 ) (725 ) Cost of sales Commodity contracts (58 ) 248 Cost of sales 225 563 Income before income taxes (45 ) (198 ) Provision for income taxes $ 180 $ 365 Net income Defined benefit pension items Amortization of defined benefit pension items (a) (9,301 ) (10,117 ) Non-operating pension (income)/cost (9,301 ) (10,117 ) Income before income taxes 2,339 3,742 Provision for income taxes $ (6,962 ) $ (6,375 ) Net income Total reclassifications for the period $ (6,782 ) $ (6,010 ) Net income (a) See Note 12 for additional details. The following table summarizes the before and after tax amounts for the various components of other comprehensive income/(loss) for the three-month periods ended April 1, 2018 and April 2, 2017 : Three months ended April 1, 2018 Three months ended April 2, 2017 Before Tax Amount Tax (Expense) Benefit After Tax Amount Before Tax Amount Tax (Expense) Benefit After Tax Amount Foreign currency items $ 22,553 $ — $ 22,553 $ 30,156 $ — $ 30,156 Defined benefit pension items: Other comprehensive income/(loss) before reclassifications (1,145 ) — (1,145 ) (147 ) 5,071 4,924 Amounts reclassified from accumulated other comprehensive income/(loss) to net income 9,301 (2,339 ) 6,962 10,117 (3,742 ) 6,375 Net other comprehensive income/(loss) from defined benefit pension items 8,156 (2,339 ) 5,817 9,970 1,329 11,299 Gains and losses on cash flow hedges: Other comprehensive income/(loss) before reclassifications 1,475 (293 ) 1,182 (4,048 ) 1,422 (2,626 ) Amounts reclassified from accumulated other comprehensive income/(loss) to net income (225 ) 45 (180 ) (563 ) 198 (365 ) Amounts reclassified from accumulated other comprehensive income/(loss) to fixed assets 45 — 45 42 — 42 Net other comprehensive income/(loss) from cash flow hedges 1,295 (248 ) 1,047 (4,569 ) 1,620 (2,949 ) Other comprehensive income/(loss) $ 32,004 $ (2,587 ) $ 29,417 $ 35,557 $ 2,949 $ 38,506 |
Goodwill and Other Intangible A
Goodwill and Other Intangible Assets | 3 Months Ended |
Apr. 01, 2018 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill and Other Intangible Assets | Goodwill and Other Intangible Assets Goodwill A summary of the changes in goodwill by segment for the three months ended April 1, 2018 is as follows: Consumer Packaging Display and Packaging Paper and Industrial Converted Products Protective Solutions Total Goodwill at December 31, 2017 $ 572,716 $ 203,414 $ 233,778 $ 231,967 $ 1,241,875 Foreign currency translation 1,528 — 1,940 354 3,822 Other 7,180 — — — 7,180 Goodwill at April 1, 2018 $ 581,424 $ 203,414 $ 235,718 $ 232,321 $ 1,252,877 In the first three months of 2018, measurement period adjustments were made to finalize the fair values of the assets acquired and the liabilities assumed in the March 2017 acquisition of Packaging Holdings resulting in an increase in goodwill of $7,180 . See Note 4 for additional information. The Company assesses goodwill for impairment annually and from time to time when warranted by the facts and circumstances surrounding individual reporting units or the Company as a whole. The Company completed its most recent annual goodwill impairment testing during the third quarter of 2017. As part of this testing, the Company analyzed certain qualitative and quantitative factors in determining goodwill impairment. The Company's assessments reflected a number of significant management assumptions and estimates including the Company's forecast of sales volumes and prices, profit margins, income taxes, capital expenditures and changes in working capital requirements. Changes in these assumptions and/or discount rates could materially impact the Company's conclusions. Based on its assessments, the Company concluded that there was no impairment of goodwill for any of its reporting units. Although no reporting units failed the assessments noted above, in management’s opinion, the reporting units having the greatest risk of a significant future impairment if actual results fall short of expectations are Display and Packaging, and Paper and Industrial Converted Products - Europe. Total goodwill associated with these reporting units was $203,414 and $97,065 , respectively, at April 1, 2018 . A large portion of projected sales in the Display and Packaging reporting unit is concentrated in several major customers, the loss of any of which could impact the Company's conclusion regarding the likelihood of goodwill impairment for the unit. There have been no triggering events identified between the most recent annual impairment test and April 1, 2018 . On April 20, 2018, the Company was advised by one if its Display and Packaging customers that that its contract would not be renewed upon expiration on December 31, 2018. Annual sales under this contract have only been approximately $12,000 , or 2.4% of total sales for the reporting unit. However, due to the narrow excess of this reporting unit’s estimated fair value over carrying value as of its most recent goodwill impairment test, management believes that as a result of this development it is probable that a goodwill impairment charge may be incurred. The Company is in the process of finalizing its quantitative analysis of the impact, but based on its current assessment of operating performance and assumptions regarding forecasts of the remainder of the Display and Packaging business, management estimates any such impairment charge will be less than $20,000 . Other Intangible Assets A summary of other intangible assets as of April 1, 2018 and December 31, 2017 is as follows: April 1, December 31, Other Intangible Assets, gross: Patents $ 21,956 $ 21,957 Customer lists 499,970 497,634 Trade names 25,161 25,148 Proprietary technology 20,792 20,779 Land use rights 303 298 Other 1,743 1,740 Other Intangible Assets, gross $ 569,925 $ 567,556 Accumulated Amortization: Patents (7,659 ) (7,187 ) Customer lists (220,589 ) (210,212 ) Trade names (4,930 ) (4,427 ) Proprietary technology (13,645 ) (13,192 ) Land use rights (50 ) (47 ) Other (1,284 ) (1,196 ) Total Accumulated Amortization $ (248,157 ) $ (236,261 ) Other Intangible Assets, net $ 321,768 $ 331,295 Other intangible assets are amortized on a straight-line basis over their respective useful lives, which generally range from three to forty years. The Company has no intangible assets with indefinite lives. Aggregate amortization expense was $10,202 and $7,211 for the three months ended April 1, 2018 and April 2, 2017 , respectively. Amortization expense on other intangible assets is expected to total approximately $43,400 in 2018, $42,300 in 2019, $39,900 in 2020, $38,900 in 2021 and $37,100 in 2022. |
Debt
Debt | 3 Months Ended |
Apr. 01, 2018 | |
Debt Disclosure [Abstract] | |
Debt | Debt On April 12, 2018, subsequent to quarter end, the Company entered into a $100,000 term loan with Bank of America, N.A. The full amount was drawn from this facility on April 12, 2018, and the proceeds, along with proceeds from existing credit facilities, were used to fund the acquisition of Highland Packaging Solutions. The loan has a 364 -day term and the Company has a one -time option to extend the term for an additional 364 days at its sole discretion. Interest is assessed at the London Interbank Offered Rate (LIBOR) plus a margin based on a pricing grid that uses the Company's credit ratings. The current LIBOR margin is 110 basis points. There is no required amortization and repayment can be accelerated at any time at the discretion of the Company. |
Financial Instruments and Deriv
Financial Instruments and Derivatives | 3 Months Ended |
Apr. 01, 2018 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Financial Instruments and Derivatives | Financial Instruments and Derivatives The following table sets forth the carrying amounts and fair values of the Company’s significant financial instruments for which the carrying amount differs from the fair value. April 1, 2018 December 31, 2017 Carrying Amount Fair Value Carrying Amount Fair Value Long-term debt, net of current portion $ 1,289,045 $ 1,407,163 $ 1,288,002 $ 1,426,862 The carrying value of cash and cash equivalents, short-term debt and long-term variable-rate debt approximates fair value. The fair value of long-term debt is determined based on recent trade information in the financial markets of the Company’s public debt or is determined by discounting future cash flows using interest rates available to the Company for issues with similar terms and maturities. It is considered a Level 2 fair value measurement. Adoption of Accounting Standards Update 2017-12 The Company elected to early adopt Accounting Standards Update (ASU) 2 017-12, "Derivatives and Hedging: Targeted Improvements to Accounting for Hedging Activities," as of January 1, 2018 . The impact of the adoption of ASU 2017-12 was the recognition of a $176 increase in the Company's beginning retained earnings with an offsetting change in accumulated other comprehensive loss in order to remove previously recognized ineffectiveness losses on contracts outstanding as of the date of adoption. See Note 2 for additional information. Cash Flow Hedges At April 1, 2018 and December 31, 2017 , the Company had derivative financial instruments outstanding to hedge anticipated transactions and certain asset and liability related cash flows. These contracts, which have maturities ranging to December 2019, qualify as cash flow hedges under U.S. GAAP. For derivative instruments that are designated and qualify as a cash flow hedge, the gain or loss on the derivative instrument is reported as a component of other comprehensive income and reclassified into earnings in the same period or periods during which the hedged transaction affects earnings and is presented in the same income statement line item as the earnings effect of the hedged item. Gains and losses on the derivative instrument representing hedge components excluded from the assessment of effectiveness are recognized currently in current earnings and are presented in the same line of the income statement expected for the hedged item. Commodity Cash Flow Hedges The Company has entered into certain derivative contracts to manage the cost of anticipated purchases of natural gas and aluminum. At April 1, 2018 , natural gas swaps covering approximately 6.0 million MMBTUs were outstanding. These contracts represent approximately 74% and 32% of anticipated U.S. and Canadian usage for the remainder of 2018 and 2019, respectively. Additionally, the Company had swap contracts covering 2,858 metric tons of aluminum, representing approximately 51% of anticipated usage for the remainder of 2018. The fair values of the Company’s commodity cash flow hedges netted to a loss position of $(1,826) at April 1, 2018 , and $(1,713) at December 31, 2017 . The amount of the loss included in Accumulated Other Comprehensive Loss at April 1, 2018 , that is expected to be reclassified to the income statement during the next twelve months is $(1,303) . Foreign Currency Cash Flow Hedges The Company has entered into forward contracts to hedge certain anticipated foreign currency denominated sales, purchases, and capital spending forecast to occur in 2018. The net positions of these contracts at April 1, 2018 were as follows (in thousands): Currency Action Quantity Colombian peso purchase 5,714,591 Mexican peso purchase 538,032 Polish zloty purchase 180,204 Canadian dollar purchase 40,162 Russian ruble purchase 24,491 Turkish lira purchase 3,856 British pound purchase 3,423 New Zealand dollar sell (464 ) Australian dollar sell (1,240 ) Euro sell (40,724 ) The fair value of these foreign currency cash flow hedges related to forecasted sales and purchases netted to gain positions of $1,837 at April 1, 2018 and $620 at December 31, 2017 . In addition, the Company has entered into forward contracts to hedge certain foreign currency cash flow transactions related to construction in progress. As of April 1, 2018 and at December 31, 2017 , the net position of these contracts was $295 and $330 , respectively. During the three months ended April 1, 2018 , gains from these hedges totaling $45 were reclassified from accumulated other comprehensive income and included in the carrying value of the related fixed assets acquired. For all cash flow hedges, gains of $1,837 are expected to be reclassified from accumulated other comprehensive income to the income statement during the next twelve months. Also during the next twelve months, gains of $295 are expected to be reclassified from accumulated other comprehensive income and included in the carrying value of the related fixed assets acquired. Other Derivatives The Company routinely enters into forward contracts or swaps to economically hedge the currency exposure of intercompany debt and existing foreign currency denominated receivables and payables. The Company does not apply hedge accounting treatment under ASC 815 for these instruments. As such, changes in fair value are recorded directly to income and expense in the periods that they occur. The net positions of these contracts at April 1, 2018 , were as follows (in thousands): Currency Action Quantity Colombian peso purchase 5,868,637 Mexican peso sell (15,638 ) Canadian dollar sell (59,117 ) The fair value of the Company’s other derivatives was in a gain position of $171 and a loss position of $(581) at April 1, 2018 and December 31, 2017 , respectively. The following table sets forth the location and fair values of the Company’s derivative instruments at April 1, 2018 and December 31, 2017 : Description Balance Sheet Location April 1, December 31, Derivatives designated as hedging instruments: Commodity Contracts Prepaid expenses $ — $ 149 Commodity Contracts Accrued expenses and other $ (1,448 ) $ (1,417 ) Commodity Contracts Other liabilities $ (378 ) $ (445 ) Foreign Exchange Contracts Prepaid expenses $ 2,964 $ 2,232 Foreign Exchange Contracts Accrued expenses and other $ (832 ) $ (1,282 ) Derivatives not designated as hedging instruments: Foreign Exchange Contracts Prepaid expenses $ 833 $ 90 Foreign Exchange Contracts Accrued expenses and other $ (662 ) $ (671 ) While certain of the Company’s derivative contract arrangements with its counterparties provide for the ability to settle contracts on a net basis, the Company reports its derivative positions on a gross basis. There are no collateral arrangements or requirements in these agreements. Description Description The following tables set forth the effect of the Company’s derivative instruments on financial performance for the three months ended April 1, 2018 and April 2, 2017 : Description Amount of Gain or (Loss) Recognized in OCI on Derivatives Location of Gain or (Loss) Reclassified from Accumulated OCI Into Income Amount of Gain or (Loss) Reclassified from Accumulated OCI Into Income Derivatives in Cash Flow Hedging Relationships: Three months ended April 1, 2018 Foreign Exchange Contracts $ 1,646 Net sales $ 810 Cost of sales $ (527 ) Commodity Contracts $ (171 ) Cost of sales $ (58 ) Three months ended April 2, 2017 Foreign Exchange Contracts $ (2,692 ) Net sales $ 1,040 Cost of sales $ (725 ) Commodity Contracts $ (1,356 ) Cost of sales $ 248 Description Location of Gain or (Loss) Recognized in Income Statement Gain or (Loss) Recognized Derivatives not Designated as Hedging Instruments: Three months ended April 1, 2018 Foreign Exchange Contracts Cost of sales $ — Selling, general and administrative $ 754 Three months ended April 2, 2017 Foreign Exchange Contracts Cost of sales $ — Selling, general and administrative $ (567 ) April 1, April 2, Description Revenue Cost of sales Revenue Cost of sales Total amount of income and expense line items presented in the Condensed Consolidated Statements of Income $ 810 $ (585 ) $ 1,040 $ (477 ) The effects of cash flow hedging: Gain or (loss) on cash flow hedging relationships in Subtopic 815-20: Foreign exchange contracts: Amount of gain or (loss) reclassified from accumulated other comprehensive income into net income $ 810 $ (527 ) $ 1,040 $ (725 ) Commodity contracts: Amount of gain or (loss) reclassified from accumulated other comprehensive income into net income $ — $ (58 ) $ — $ 248 |
Fair Value Measurements
Fair Value Measurements | 3 Months Ended |
Apr. 01, 2018 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | Fair Value Measurements Fair value is defined as an exit price, representing the amount that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants. Fair value is a market-based measurement that is determined based on assumptions that market participants would use in pricing an asset or liability. A three-tier fair value hierarchy is used to prioritize the inputs in measuring fair value as follows: Level 1 – Observable inputs such as quoted market prices in active markets; Level 2 – Inputs, other than quoted prices in active markets, that are observable either directly or indirectly; and Level 3 – Unobservable inputs for which there is little or no market data, which require the reporting entity to develop its own assumptions. The following table sets forth information regarding the Company’s financial assets and financial liabilities, excluding retirement and postretirement plan assets, measured at fair value on a recurring basis: Description April 1, Assets measured at NAV Level 1 Level 2 Level 3 Hedge derivatives, net: Commodity contracts $ (1,826 ) $ — $ — $ (1,826 ) $ — Foreign exchange contracts $ 2,132 $ — $ — $ 2,132 $ — Non-hedge derivatives, net: Foreign exchange contracts $ 171 $ — $ — $ 171 $ — Deferred compensation plan assets $ 266 $ — $ 266 $ — $ — Description December 31, Assets measured at NAV Level 1 Level 2 Level 3 Hedge derivatives, net: Commodity contracts $ (1,713 ) $ — $ — $ (1,713 ) $ — Foreign exchange contracts $ 950 $ — $ — $ 950 $ — Non-hedge derivatives, net: Foreign exchange contracts $ (581 ) $ — $ — $ (581 ) $ — Deferred compensation plan assets $ 268 $ — $ 268 $ — $ — As discussed in Note 10, the Company uses derivatives to mitigate the effect of raw material and energy cost fluctuations, foreign currency fluctuations and, from time to time, interest rate movements. Fair value measurements for the Company’s derivatives are classified under Level 2 because such measurements are estimated based on observable inputs such as interest rates, yield curves, spot and future commodity prices and spot and future exchange rates. Certain deferred compensation plan liabilities are funded by assets invested in various exchange traded mutual funds. These assets are measured using quoted prices in accessible active markets for identical assets. The Company does not currently have any non-financial assets or liabilities that are recognized or disclosed at fair value on a recurring basis. None of the Company’s financial assets or liabilities are measured at fair value using significant unobservable inputs. There were no transfers in or out of Level 1 or Level 2 fair value measurements during the three -month period ended April 1, 2018 . |
Employee Benefit Plans
Employee Benefit Plans | 3 Months Ended |
Apr. 01, 2018 | |
Retirement Benefits [Abstract] | |
Employee Benefit Plans | Employee Benefit Plans Retirement Plans and Retiree Health and Life Insurance Plans The Company provides non-contributory defined benefit pension plans to certain of its employees in the United States and certain of its employees in Mexico and Belgium. The Company also sponsors contributory defined benefit pension plans covering the majority of its employees in the United Kingdom, Canada, and the Netherlands. In addition, the Company provides postretirement healthcare and life insurance benefits to a limited number of its retirees and their dependents in the United States and Canada, based on certain age and/or service eligibility requirements. The Company froze participation in its U.S. qualified defined benefit pension plan for newly hired salaried and non-union hourly employees effective December 31, 2003. To replace this benefit, the Company provides non-union U.S. employees hired on or after January 1, 2004, with an annual contribution, called the Sonoco Retirement Contribution (SRC), to their participant accounts in the Sonoco Retirement and Savings Plan. The SRC is equal to 4% of the participant's eligible pay plus 4% of eligible pay in excess of the social security wage base. Also eligible for the SRC are former participants of the U.S. qualified defined benefit pension plan who elected to transfer out of that plan under a one-time option effective January 1, 2010. On February 4, 2009, the U.S. qualified defined benefit pension plan was amended to freeze plan benefits for all active participants effective December 31, 2018. Remaining active participants in the U.S. qualified plan will become eligible for SRC contributions effective January 1, 2019. The components of net periodic benefit cost include the following: Three Months Ended April 1, April 2, Retirement Plans Service cost $ 4,672 $ 4,712 Interest cost 13,978 14,701 Expected return on plan assets (23,209 ) (20,838 ) Amortization of prior service cost 249 231 Amortization of net actuarial loss 9,420 10,168 Net periodic benefit cost $ 5,110 $ 8,974 Retiree Health and Life Insurance Plans Service cost $ 79 $ 84 Interest cost 111 120 Expected return on plan assets (472 ) (414 ) Amortization of prior service credit (126 ) (127 ) Amortization of net actuarial gain (242 ) (155 ) Net periodic benefit income $ (650 ) $ (492 ) The Company made aggregate contributions of $4,573 and $29,491 to its defined benefit retirement and retiree health and life insurance plans during the three months ended April 1, 2018 and April 2, 2017 , respectively. The Company expects to make additional aggregate contributions of approximately $20,000 to its defined benefit retirement and retiree health and life insurance plans over the remainder of 2018. Sonoco Retirement Contribution (SRC) The SRC, which is funded annually in the first quarter, totaled $14,151 during the three months ended April 1, 2018 , and $14,066 during the three months ended April 2, 2017 . No additional SRC contributions are expected during the remainder of 2018. The Company recognized expense related to the SRC of $4,032 and $3,871 for the three-month periods ended April 1, 2018 and April 2, 2017 , respectively. |
Income Taxes
Income Taxes | 3 Months Ended |
Apr. 01, 2018 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes The Company’s effective tax rate for the three -month period ending April 1, 2018 , was 24.1% and its effective rate for the three -month period ending April 2, 2017 , was 32.8% . The rate for the three-month period ending April 1, 2018 varied from the U.S. statutory rate due primarily to the new international tax regime of the U.S. as part of the enactment of the Tax Cuts and Jobs Act as well as the effect of state income taxes. The rate for the the three-month period ending April 2, 2017 varied from the U.S. statutory rate due primarily to the favorable effect of certain international operations that were subject to tax rates generally lower than the U.S. rate. On December 22, 2017, the SEC staff issued Staff Accounting Bulletin No. 118 (“SAB 118”) to address the application of U.S. GAAP in situations where a registrant does not have the necessary information available, prepared, or analyzed (including computations) in reasonable detail to complete the accounting for certain income tax effects of the Tax Act. The Company recognized the provisional tax impacts related to deemed repatriated earnings and the revaluation of deferred tax assets and liabilities and included these amounts in its consolidated financial statements for the year ended December 31, 2017. The ultimate impact may differ from these provisional amounts, possibly materially, due to, among other things, additional analysis, changes in interpretations and assumptions the Company has made, additional regulatory guidance that may be issued, and actions the Company may take as a result of the Tax Act. No subsequent adjustments were made during the period ended April 1, 2018, to the provisional amounts recorded in December. Any such adjustments will be recorded to current tax expense in 2018 in the quarter the analysis is completed. The Company and/or its subsidiaries file federal, state and local income tax returns in the United States and various foreign jurisdictions. With few exceptions, the Company is no longer subject to income tax examinations by tax authorities for years before 2012. The Company is currently under audit by the Internal Revenue Service for the 2012 and 2013 tax years. The Company’s reserve for uncertain tax benefits has increased by approximately $1,000 since December 31, 2017 , due primarily to an increase in reserves related to existing uncertain tax positions. The Company believes that it is reasonably possible that the amount reserved for unrecognized tax benefits at April 1, 2018 will decrease by approximately $800 over the next twelve months. This change includes the anticipated increase in reserves related to existing positions offset by settlements of issues currently under examination and the release of existing reserves due to the expiration of the statute of limitations. Although the Company’s estimate for the potential outcome for any uncertain tax issue is highly judgmental, management believes that any reasonably foreseeable outcomes related to these matters have been adequately provided for. However, future results may include favorable or unfavorable adjustments to estimated tax liabilities in the period the assessments are made or resolved or when statutes of limitation on potential assessments expire. Additionally, the jurisdictions in which earnings or deductions are realized may differ from current estimates. As a result, the Company’s effective tax rate may fluctuate significantly on a quarterly basis. The Company has operations and pays taxes in many countries outside of the U.S. and taxes on those earnings are subject to varying rates. The Company is not dependent upon the favorable benefit of any one jurisdiction to an extent that loss of those benefits would have a material effect on the Company’s overall effective tax rate. As previously disclosed, the Company received a draft Notice of Proposed Adjustment (“NOPA”) from the Internal Revenue Service (IRS) in February 2017 proposing an adjustment to income for the 2013 tax year based on the IRS's recharacterization of a distribution of an intercompany note made in 2012, and the subsequent repayment of the note over the course of 2013, as if it were a cash distribution made in 2013. In March 2017, the Company received a draft NOPA proposing penalties of $18,000 associated with the IRS’s recharacterization, as well as an Information Document Request (“IDR”) requesting the Company’s analysis of why such penalties should not apply. The Company responded to this IDR in April 2017. On October 5, 2017, the Company received two revised draft NOPAs proposing the same adjustments and penalties as in the prior NOPAs. On November 14, 2017, the Company received two final NOPAs proposing the same adjustments and penalties as in the prior draft NOPAs. On November 20, 2017, the Company received a Revenue Agent's Report (“RAR”) that included the same adjustments and penalties as in the NOPAs. At the time of the distribution in 2012, it was characterized as a dividend to the extent of earnings and profits, with the remainder as a tax free return of basis and taxable capital gain. As the IRS proposes to recharacterize the distribution, the entire distribution would be characterized as a dividend. The incremental tax liability associated with the income adjustment proposed in the RAR would be approximately $89,000 , excluding interest and the previously referenced penalties. On January 22, 2018, the Company filed a protest to the proposed deficiency with the IRS, which will cause the matter to be referred to the Appeals Division of the IRS. The Company strongly believes the position of the IRS with regard to this matter is inconsistent with applicable tax laws and existing Treasury regulations, and that the Company's previously reported income tax provision for the year in question is appropriate. However, there can be no assurance that this matter will be resolved in the Company's favor. Regardless of whether the matter is resolved in the Company's favor, the final resolution of this matter could be expensive and time consuming to defend and/or settle. While the Company believes that the amount of tax originally paid with respect to this distribution is correct, and accordingly has not provided additional reserve for tax uncertainty, there is still a possibility that an adverse outcome of the matter could have a material effect on its results of operations and financial condition. |
Revenue Recognition
Revenue Recognition | 3 Months Ended |
Apr. 01, 2018 | |
Revenue from Contract with Customer [Abstract] | |
Revenue Recognition | Revenue Recognition The Company adopted ASU 2014-09, "Revenue from Contracts with Customers," as of January 1, 2018. The impact of the adoption was the recognition of a $1,721 increase in the Company's beginning retained earnings. See impact of adoption in Note 3 and additional discussion in Note 2 to these condensed consolidated financial statements. The Company records revenue when control is transferred to the customer, which is either upon shipment or over time when the Company is entitled to payment and products are customer specific without alternative uses. The Company recognized over time revenue under the output method as goods are produced. Revenue that is recognized at a point in time is recognized when the customer obtains control of the goods. Customers obtain control either when goods are delivered to the customer facility, if the Company is responsible for arranging transportation, or when picked up by the customer's designated carrier. The Company enters into Master Supply Arrangements (MSA) with customers to provide services over specific time periods. Customers submit purchase orders with quantities and prices to create a contract for accounting purposes. Shipping and handling expenses are included in "Cost of Sales," and freight charged to customers is included in "Net Sales" in the Company's Condensed Consolidated Statements of Income. The Company has rebate agreements with certain customers. These rebates are recorded as reductions of sales and are accrued using sales data and rebate percentages specific to each customer agreement. Accrued customer rebates are included in "Accrued expenses and other" in the Company's Condensed Consolidated Balance Sheets. Payment terms under the Company's arrangements are short term in nature, generally no longer than 120 days. The Company does provide prompt payment discounts to certain customers if invoices are paid within a predetermined period. Prompt payment discounts are treated as a reduction of revenue and are determinable within a short period of the sale. The following table sets forth information about receivables, contract assets and liabilities from contracts with customers. The balances of the contract assets and liabilities are located in "Other receivables" and "Accrued expenses and other" on the Condensed Consolidated Balance Sheets. April 1, 2018 January 1, 2018 As adjusted Contract Assets $ 49,721 $ 45,877 Contract Liabilities $ (5,476 ) $ (5,215 ) Significant changes in the contract assets and liabilities balances during the period were as follows: April 1, 2018 January 1, 2018 Adjusted Contract Asset Contract Liability Contract Asset Contract Liability Beginning Balance $ 45,877 $ (5,215 ) $ — $ — Revenue recognized that was included in the contract liabilities balance at the beginning of the period — (261 ) — — Increases due to cash received, excluding amounts recognized as revenue during the period 49,721 — — — Transferred to receivables from contract assets recognized at the beginning of the period (45,877 ) — — — Increase as a result of cumulative catch-up arising from changes in the estimate of completion, excluding amounts transferred to receivables during the period — — 45,877 (5,215 ) Impairment of contract asset — — — — Acquired as part of a business combinations — — — — Ending Balance $ 49,721 $ (5,476 ) $ 45,877 $ (5,215 ) Contract assets and liabilities are generally short in duration given the nature of products produced by the Company. Contract assets represents goods produced without alternative use for which the Company is entitled to payment with margin prior to shipment. Upon shipment, the Company is entitled to bill the customer, and therefore amounts included in contract assets will be reduced with the recording of an account receivable as they represent an unconditional right to payment. Contract liabilities represent revenue deferred due to pricing mechanisms utilized by the Company in certain multi-year arrangements. Generally the Company will defer revenue during the initial term of the arrangement, and will release the deferral over the back half of the contract term. The Company's reportable segments are aligned by product nature as disclosed in Note 15. The following table sets forth information about revenue disaggregated by primary geographic regions, and timing of revenue recognition for the three-month period ended April 1, 2018. The table also includes a reconciliation of disaggregated revenue with reportable segments. Consumer Packaging Display and Packaging Paper and Industrial Converted Products Protective Solutions Primary Geographical Markets: United States $ 397,986 $ 73,884 $ 265,762 $ 110,500 Europe 107,063 65,945 92,855 6,789 Canada 27,706 — 32,873 — Other 37,097 2,829 69,163 13,735 Total $ 569,852 $ 142,658 $ 460,653 $ 131,024 Timing of Revenue Recognition: Products transferred at a point in time $ 345,003 $ 64,715 $ 440,477 $ 111,798 Products transferred over time 224,849 77,943 20,176 19,226 Total $ 569,852 $ 142,658 $ 460,653 $ 131,024 |
Segment Reporting
Segment Reporting | 3 Months Ended |
Apr. 01, 2018 | |
Segment Reporting [Abstract] | |
Segment Reporting | Segment Reporting The Company reports its financial results in four reportable segments: Consumer Packaging, Display and Packaging, Paper and Industrial Converted Products, and Protective Solutions. The Consumer Packaging segment includes the following products and services: round and shaped rigid containers and trays (both composite and thermoformed plastic); extruded and injection-molded plastic products; printed flexible packaging; global brand artwork management; and metal and peelable membrane ends and closures. The Display and Packaging segment includes the following products and services: point-of-purchase displays; supply chain management services; retail packaging, including printed backer cards, thermoformed blisters and heat sealing equipment; and paperboard specialties, such as coasters and glass covers. The Paper and Industrial Converted Products segment includes the following products: paperboard tubes and cores; fiber-based construction tubes and forms; wooden, metal and composite wire and cable reels and spools; and recycled paperboard, linerboard, corrugating medium, recovered paper and material recycling services. The Protective Solutions segment includes the following products: custom-engineered, paperboard-based and expanded foam protective packaging and components; and temperature-assured packaging. The following table sets forth net sales, intersegment sales and operating profit for the Company’s reportable segments. “Segment operating profit” is defined as the segment’s portion of “Operating profit” excluding restructuring charges, asset impairment charges, acquisition-related costs, and certain other items, if any, the exclusion of which the Company believes improves comparability and analysis of the financial performance of the business. General corporate expenses have been allocated as operating costs to each of the Company’s reportable segments. SEGMENT FINANCIAL INFORMATION Three Months Ended April 1, April 2, Net sales: Consumer Packaging $ 569,852 $ 482,181 Display and Packaging 142,658 114,635 Paper and Industrial Converted Products 460,653 442,502 Protective Solutions 131,024 133,006 Consolidated $ 1,304,187 $ 1,172,324 Intersegment sales: Consumer Packaging $ 739 $ 1,223 Display and Packaging 538 750 Paper and Industrial Converted Products 34,543 28,373 Protective Solutions 573 399 Consolidated $ 36,393 $ 30,745 Operating profit: Segment operating profit: Consumer Packaging $ 61,088 $ 59,460 Display and Packaging 1,732 3,222 Paper and Industrial Converted Products 39,781 26,850 Protective Solutions 10,680 10,931 Restructuring/Asset impairment charges (3,063 ) (4,111 ) Other, net (120 ) (2,693 ) Consolidated $ 110,098 $ 93,659 |
Commitments and Contingencies
Commitments and Contingencies | 3 Months Ended |
Apr. 01, 2018 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Commitments and Contingencies Pursuant to U.S. GAAP, accruals for estimated losses are recorded at the time information becomes available indicating that losses are probable and that the amounts are reasonably estimable. As is the case with other companies in similar industries, the Company faces exposure from actual or potential claims and legal proceedings from a variety of sources. Some of these exposures, as discussed below, have the potential to be material. Environmental Matters The Company is subject to a variety of environmental and pollution control laws and regulations in all jurisdictions in which it operates. Spartanburg In connection with its acquisition of Tegrant in November 2011, the Company identified potential environmental contamination at a site in Spartanburg, South Carolina. The total remediation cost of the Spartanburg site was estimated to be $17,400 at the time of acquisition and an accrual in this amount was recorded on Tegrant’s opening balance sheet. Since the acquisition, the Company has spent a total of $1,075 on remediation of the Spartanburg site. During previous years, the Company has increased its reserves for this site by a total of $17 in order to reflect its best estimate of what it is likely to pay in order to complete the remediation. At April 1, 2018 and December 31, 2017 , the Company's accrual for environmental contingencies related to the Spartanburg site totaled $16,342 and $16,504 , respectively. The Company cannot currently estimate its potential liability, damages or range of potential loss, if any, beyond the amounts accrued with respect to this exposure. However, the Company does not believe that the resolution of this matter has a reasonable possibility of having a material adverse effect on the Company's financial statements. Other environmental matters The Company has been named as a potentially responsible party at several other environmentally contaminated sites. All of the sites are also the responsibility of other parties. The potential remediation liabilities are shared with such other parties, and, in most cases, the Company’s share, if any, cannot be reasonably estimated at the current time. However, the Company does not believe that the resolution of these matters has a reasonable possibility of having a material adverse effect on the Company's financial statements. At April 1, 2018 and December 31, 2017 , the Company's accrual for these other sites totaled $3,389 and $3,802 , respectively. Summary As of April 1, 2018 and December 31, 2017 , the Company (and its subsidiaries) had accrued $19,731 and $20,306 , respectively, related to environmental contingencies. These accruals are included in “Accrued expenses and other” on the Company’s Condensed Consolidated Balance Sheets. Other Legal Matters In addition to those matters described above, the Company is subject to other various legal proceedings, claims, and litigation arising in the ordinary course of business. While the outcome of these matters could differ from management’s expectations, the Company does not believe the resolution of these matters has a reasonable possibility of having a material adverse effect on the Company’s financial statements. |
New Accounting Pronouncements (
New Accounting Pronouncements (Policies) | 3 Months Ended |
Apr. 01, 2018 | |
Accounting Changes and Error Corrections [Abstract] | |
New Accounting Pronouncements | New Accounting Pronouncements In August 2017, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) 2 017-12, "Derivatives and Hedging: Targeted Improvements to Accounting for Hedging Activities," which expands and refines hedge accounting for both financial and non-financial risk components, aligns the recognition and presentation of the effects of hedging instruments and hedge items in the financial statements, and includes certain targeted improvements to ease the application of current guidance related to the assessment of hedge effectiveness. The update to the standard is effective for periods beginning after December 15, 2018, with early adoption permitted in any interim period after issuance of this update. T he Company implemented this ASU effective January 1, 2018, and recorded a cumulative adjustment to retained earnings of $176 as of that date in order to remove previously recognized ineffectiveness losses on contracts outstanding as of the date of adoption. In March 2017, the FASB issued ASU 2017-07, “Improving the Presentation of Net Periodic Pension Cost and Net Periodic Postretirement Benefit Cost,” which requires an employer to report service cost in the same line item as other compensation costs arising from employees during the period. The other components of net benefit cost as defined are required to be presented separately from the service cost component and outside a subtotal of income from operations, if one is presented, or disclosed. This update also allows only the service cost component to be eligible for capitalization when applicable and is effective for periods beginning after December 15, 2017. The amendments are to be applied retrospectively for the presentation of the components of net benefit cost in the income statement and prospectively for the capitalization of the service cost component. T he Company implemented this ASU effective January 1, 2018, modifying its income statement presentation of the components of net benefit cost accordingly, including the retrospective application to previously reported results. As a result of the retrospective application, the amounts previously reported in "Cost of sales" and "Selling, general and administrative expenses" for the three months ended April 2, 2017 , were reduced by $2,757 and $929 , respectively, and "Operating profit" increased by $3,686 , in order to conform to the current presentation. No change was required to the Company's historical policy regarding the capitalization of such costs. In January 2017, the FASB issued ASU 2017-04, “Simplifying the Test for Goodwill Impairment,” eliminating the requirement to determine the fair value of individual assets and liabilities of a reporting unit to measure goodwill impairment. Under ASU 2017-04, goodwill impairment testing is performed by comparing the fair value of the reporting unit with its carrying amount and recognizing an impairment charge for the amount by which the carrying amount exceeds the reporting unit’s fair value. The new standard is effective for annual and interim goodwill impairment tests in fiscal years beginning after December 15, 2019, with early adoption permitted, and should be applied on a prospective basis. The Company elected early adoption of the standard effective January 1, 2018. Any future goodwill impairment, should it occur, will be determined in accordance with this ASU. In October 2016, the FASB issued ASU 2016-16, "Intra-Entity Transfers of Assets Other Than Inventory," which requires an entity to recognize the income tax consequences of an intra-entity transfer of an asset upon transfer other than inventory, eliminating the current recognition exception. Prior to this ASU, GAAP prohibited the recognition of current and deferred income taxes for intra-entity asset transfers until the asset was sold to an outside party. The recognition prohibition was an exception to the principle of comprehensive recognition of current and deferred income taxes in GAAP. This guidance became effective for the Company on January 1, 2018, and did not have a material effect on its consolidated financial statements. In August 2016, the FASB issued ASU 2016-15, " Classification of Certain Cash Receipts and Cash Payments ," providing clarification on eight cash flow classification issues, including 1) debt prepayment or debt extinguishment costs, 2) settlement of relatively insignificant debt instruments, 3) contingent consideration payments, 4) insurance claim settlements, 5) life insurance settlements, 6) distributions received from equity method investees, 7) beneficial interests in securitization transactions, and 8) separately identifiable cash flows. This guidance, which applies to both interim and annual periods, became effective for the Company on January 1, 2018. Adoption of this ASU did not have a material effect on the Company's consolidated financial statements in the periods ended April 1, 2018 and April 2, 2017, as the Company either did not realize any cash flows from these types of activities, such amounts were immaterial, or the prescribed guidance did not differ from its current practice. In March 2016, the FASB issued ASU 2016-08, "Revenue from Contracts with Customers, Principal versus Agent Considerations (Reporting Revenue Gross versus Net)," which provides guidance on recording revenue on a gross basis versus a net basis based on the determination of whether an entity is a principal or an agent when another party is involved in providing goods or services to a customer. The amendments in this update affect the guidance in ASU No. 2014-09 and are effective in the same time frame as ASU 2014-09 as discussed below. In February 2016, the FASB issued ASU 2016-02, "Leases" which changes accounting for leases and requires lessees to recognize the assets and liabilities arising from all leases, including those classified as operating leases under previous accounting guidance on the balance sheet and requires disclosure of key information about leasing arrangements to increase transparency and comparability among organizations. The accounting for lessors does not fundamentally change except for changes to conform and align guidance to the lessee guidance. The guidance is effective for reporting periods beginning after December 15, 2018, including interim periods within those fiscal years and requires retrospective application. The Company is still assessing the impact of ASU 2016-02 on its consolidated financial statements, but expects the adoption of this ASU to have a material impact on its consolidated balance sheet for the initial recognition of the right-of-use asset and lease liability associated with operating leases that are not currently recognized on the balance sheet under present U.S. GAAP. In May 2014, the FASB issued ASU 2014-09, "Revenue From Contracts With Customers," which changes the definitions/criteria used to determine when revenue should be recognized from being based on risks and rewards to being based on control. Among other changes, ASU 2014-09 changes the manner in which variable consideration is recognized, requires recognition of the time value of money when payment terms exceed one year, provides clarification on accounting for contract costs, and expands disclosure requirements. The Company adopted ASU 2014-09 in the first quarter of 2018 following the modified retrospective transition method and, as such, recorded a cumulative adjustment of $1,721 to beginning retained earnings for the period. The most significant impacts to the Company's financial statements from the adoption of this ASU are the acceleration of revenue recognition compared to prior standards for arrangements under which the Company is producing customer-specific products without alternative use and would be entitled to payment for work completed, including a reasonable margin, and the recognition of material customer contract rights for certain agreed-upon future price concessions. During the three -month period ended April 1, 2018 , there have been no other newly issued nor newly applicable accounting pronouncements that have had, or are expected to have, a material impact on the Company’s financial statements. Further, at April 1, 2018 , there were no other pronouncements pending adoption that are expected to have a material impact on the Company’s consolidated financial statements. |
Changes in Accounting Policy (T
Changes in Accounting Policy (Tables) | 3 Months Ended |
Apr. 01, 2018 | |
Accounting Changes and Error Corrections [Abstract] | |
Schedule of Effect of New Accounting Pronouncements | The details of the significant changes and quantitative impact of the changes are set out below. December 31, 2017 As Reported Adjustments January 1, 2018 Adjusted Assets Current Assets Trade accounts receivable, net of allowances 725,251 3,636 728,887 Other receivables 64,561 41,351 105,912 Inventories: Finished and in process 196,204 (37,447 ) 158,757 Total Assets $ 4,557,721 $ 7,540 $ 4,565,261 Liabilities and Equity Current Liabilities Accrued expenses and other 283,355 5,215 288,570 999,970 5,215 1,005,185 Deferred Income Taxes 74,073 604 74,677 Sonoco Shareholders’ Equity Retained earnings 2,036,006 1,721 2,037,727 Total Sonoco Shareholders’ Equity 1,707,066 1,721 1,708,787 Total Equity 1,730,060 1,721 1,731,781 Total Liabilities and Equity $ 4,557,721 $ 7,540 $ 4,565,261 The following table summarizes the impact of the adoption of Topic 606 on the Company's Condensed Consolidated Balance Sheet as of April 1, 2018 : April 1, 2018 As Reported Adjustments Balances without Adoption of Topic 606 Assets Current Assets Trade accounts receivable, net of allowances 756,102 (3,819 ) 752,283 Other receivables 91,319 (44,489 ) 46,830 Inventories: Finished and in process 155,417 40,070 195,487 Total Assets $ 4,653,069 $ (8,238 ) $ 4,644,831 Liabilities and Equity Current Liabilities Accrued expenses and other 278,380 (5,476 ) 272,904 1,035,374 (5,476 ) 1,029,898 Deferred Income Taxes 72,303 (718 ) 71,585 Sonoco Shareholders' Equity Retained earnings 2,072,423 (2,044 ) 2,070,379 Total Sonoco Shareholders’ Equity 1,772,163 (2,044 ) 1,770,119 Total Equity 1,796,456 (2,044 ) 1,794,412 Total Liabilities and Equity $ 4,653,069 $ (8,238 ) $ 4,644,831 The following table summarizes the impact of the adoption of Topic 606 on the Company's Condensed Consolidated Statement of Income for the three months ended April 1, 2018 : Three Months Ended April 1, 2018 As Reported Adjustments Balances without Adoption of Topic 606 Net sales $ 1,304,187 $ (3,060 ) $ 1,301,127 Cost of sales 1,053,585 (2,623 ) 1,050,962 Gross profit 250,602 (437 ) 250,165 Operating profit 110,098 (437 ) 109,661 Income before income taxes 97,034 (437 ) 96,597 Provision for income taxes 23,356 (114 ) 23,242 Income before equity in earnings of affiliates 73,678 (323 ) 73,355 Net income 74,925 (323 ) 74,602 Net income attributable to Sonoco $ 74,055 $ (323 ) $ 73,732 The following table summarizes the impact of the adoption of Topic 606 on the Company's Condensed Consolidated Statement of Comprehensive Income for the three months ended April 1, 2018 : Three Months Ended April 1, 2018 As Reported Adjustments Balances without Adoption of Topic 606 Net income $ 74,925 $ (323 ) $ 74,602 Comprehensive income 104,772 (323 ) 104,449 Comprehensive income attributable to Sonoco $ 103,472 $ (323 ) $ 103,149 The following table summarizes the impact of the adoption of Topic 606 on the Company's Condensed Consolidated Statement of Cash Flows for the three months ended April 1, 2018 : Three Months Ended April 1, 2018 As Reported Adjustments Balances without Adoption of Topic 606 Cash Flows from Operating Activities: Net income $ 74,925 $ (323 ) $ 74,602 Trade accounts receivable (19,346 ) 182 (19,164 ) Inventories (17,814 ) 516 (17,298 ) Accrued expenses (229 ) (261 ) (490 ) Income taxes payable and other income tax items 17,183 (114 ) 17,069 Net cash provided by operating activities 119,765 — 119,765 |
Shareholders' Equity (Tables)
Shareholders' Equity (Tables) | 3 Months Ended |
Apr. 01, 2018 | |
Equity [Abstract] | |
Earnings Per Share | The following table sets forth the computation of basic and diluted earnings per share (dollars and shares in thousands, except per share data): Three Months Ended April 1, April 2, Numerator: Net income attributable to Sonoco $ 74,055 $ 53,733 Denominator: Weighted average common shares outstanding: Basic 100,396 100,112 Dilutive effect of stock-based compensation 500 868 Diluted 100,896 100,980 Net income attributable to Sonoco per common share: Basic $ 0.74 $ 0.54 Diluted $ 0.73 $ 0.53 |
Schedule of Antidilutive Securities Excluded from Computation of Earnings Per Share | The average number of SARs that were not dilutive and therefore not included in the computation of diluted earnings per share during the three -month periods ended April 1, 2018 and April 2, 2017 was as follows (in thousands): Three Months Ended April 1, April 2, Anti-dilutive stock appreciation rights 738 356 |
Restructuring and Asset Impai26
Restructuring and Asset Impairment (Tables) | 3 Months Ended |
Apr. 01, 2018 | |
Restructuring and Related Activities [Abstract] | |
Total Restructuring and Asset Impairment Charges/(Credits), Net | Following are the total restructuring and asset impairment charges/(credits), net of adjustments, and gains on dispositions recognized by the Company during the periods presented: Three Months Ended April 1, 2018 April 2, 2017 Restructuring/Asset impairment: 2018 Actions $ 2,207 $ — 2017 Actions 405 2,304 2016 and Earlier Actions 451 1,807 Restructuring/Asset impairment charges $ 3,063 $ 4,111 Income tax benefit (685 ) (1,298 ) Less: Costs attributable to noncontrolling interests, net of tax (5 ) (2 ) Restructuring/asset impairment charges attributable to Sonoco, net of tax $ 2,373 $ 2,811 |
Actions and Related Expenses by Segment and by Type Incurred and Estimated for Given Years | Below is a summary of 2018 Actions and related expenses by segment and by type incurred and estimated to be incurred through completion. 2018 Actions First Quarter 2018 Estimated Severance and Termination Benefits Consumer Packaging $ 788 $ 938 Display and Packaging 175 175 Paper and Industrial Converted Products 991 991 Protective Solutions 259 259 Corporate 223 223 Asset Impairment / Disposal of Assets Consumer Packaging (14 ) (14 ) Protective Solutions (272 ) (272 ) Other Costs Consumer Packaging 11 311 Paper and Industrial Converted Products — 1,000 Protective Solutions 46 46 Total Charges and Adjustments $ 2,207 $ 3,657 Below is a summary of 2017 Actions and related expenses by segment and by type incurred and estimated to be incurred through completion. Three Months Ended Total Incurred Estimated 2017 Actions April 1, 2018 April 2, 2017 Severance and Termination Benefits Consumer Packaging $ 372 $ 967 $ 4,563 $ 4,763 Display and Packaging (8 ) 106 733 733 Paper and Industrial Converted Products 4 541 4,022 4,022 Protective Solutions 133 75 1,531 1,531 Corporate — 456 452 452 Asset Impairment / Disposal of Assets Consumer Packaging — — 351 351 Display and Packaging 166 — 166 166 Paper and Industrial Converted Products (665 ) — (760 ) (760 ) Protective Solutions — — 871 871 Other Costs Consumer Packaging 107 159 986 986 Display and Packaging (348 ) — 441 441 Paper and Industrial Converted Products 550 — 1,551 1,551 Protective Solutions 94 — 836 836 Corporate — — (9 ) (9 ) Total Charges and Adjustments $ 405 $ 2,304 $ 15,734 $ 15,934 Below is a summary of expenses/(income) incurred by segment for 2016 and Earlier Actions for the three -month periods ended April 1, 2018 and April 2, 2017 . 2018 2017 2016 and Earlier Actions First Quarter First Quarter Consumer Packaging $ 465 $ (26 ) Display and Packaging 1 395 Paper and Industrial Converted Products (33 ) 1,353 Protective Solutions 18 78 Corporate — 7 Total Charges and Adjustments $ 451 $ 1,807 |
Restructuring Accrual Activity for Given Years | The following table sets forth the activity in the 2017 Actions restructuring accrual included in “Accrued expenses and other” on the Company’s Condensed Consolidated Balance Sheets: 2017 Actions Severance Asset Other Total Accrual Activity 2018 Year to Date Liability at December 31, 2017 $ 3,889 $ — $ 213 $ 4,102 2018 charges 501 (499 ) 403 405 Cash payments (1,727 ) 1,023 (501 ) (1,205 ) Asset write downs/disposals — (524 ) — (524 ) Foreign currency translation 69 — 11 80 Liability at April 1, 2018 $ 2,732 $ — $ 126 $ 2,858 The following table sets forth the activity in the 2018 Actions restructuring accrual included in “Accrued expenses and other” on the Company’s Condensed Consolidated Balance Sheets: 2018 Actions Severance Termination Asset Impairment/ Disposal Other Costs Total Accrual Activity Liability at December 31, 2017 $ — $ — $ — $ — 2018 charges 2,436 (286 ) 57 2,207 Cash receipts/(payments) (259 ) 2,049 (10 ) 1,780 Asset write downs/disposals — (1,763 ) — (1,763 ) Foreign currency translation (4 ) — — (4 ) Liability at April 1, 2018 $ 2,173 $ — $ 47 $ 2,220 |
Accumulated Other Comprehensi27
Accumulated Other Comprehensive Loss (Tables) | 3 Months Ended |
Apr. 01, 2018 | |
Equity [Abstract] | |
Components of Accumulated Other Comprehensive Loss | The following table summarizes the components of accumulated other comprehensive loss and the changes in the balances of each component of accumulated other comprehensive loss, net of tax as applicable, for the three months ended April 1, 2018 and April 2, 2017 : Gains and Losses on Cash Flow Hedges Defined Benefit Pension Items Foreign Currency Items Accumulated Other Comprehensive Loss Balance at December 31, 2017 $ (641 ) $ (467,136 ) $ (198,495 ) $ (666,272 ) Other comprehensive income/(loss) before reclassifications 1,182 (1,145 ) 22,553 22,590 Amounts reclassified from accumulated other comprehensive loss to net income (180 ) 6,962 — 6,782 Amounts reclassified from accumulated other comprehensive loss to fixed assets 45 — — 45 Other comprehensive income/(loss) 1,047 5,817 22,553 29,417 Amounts reclassified from retained earnings to accumulated other comprehensive loss $ (176 ) $ — $ — (176 ) Balance at April 1, 2018 $ 230 $ (461,319 ) $ (175,942 ) $ (637,031 ) Balance at December 31, 2016 $ 1,939 $ (453,821 ) $ (286,498 ) $ (738,380 ) Other comprehensive income/(loss) before reclassifications (2,626 ) 4,924 30,156 32,454 Amounts reclassified from accumulated other comprehensive loss to net income (365 ) 6,375 — 6,010 Amounts reclassified from accumulated other comprehensive loss to fixed assets 42 — — 42 Other comprehensive income/(loss) (2,949 ) 11,299 30,156 38,506 Balance at April 2, 2017 $ (1,010 ) $ (442,522 ) $ (256,342 ) $ (699,874 ) |
Effects on Net Income of Significant Amounts Reclassified from Accumulated Other Comprehensive Loss | The following table summarizes the effects on net income of significant amounts reclassified from each component of accumulated other comprehensive loss for the three -month periods ended April 1, 2018 and April 2, 2017 : Amount Reclassified from Accumulated Other Comprehensive Loss Three Months Ended Details about Accumulated Other Comprehensive Loss Components April 1, April 2, Affected Line Item in the Condensed Consolidated Statements of Income Gains and losses on cash flow hedges Foreign exchange contracts $ 810 $ 1,040 Net sales Foreign exchange contracts (527 ) (725 ) Cost of sales Commodity contracts (58 ) 248 Cost of sales 225 563 Income before income taxes (45 ) (198 ) Provision for income taxes $ 180 $ 365 Net income Defined benefit pension items Amortization of defined benefit pension items (a) (9,301 ) (10,117 ) Non-operating pension (income)/cost (9,301 ) (10,117 ) Income before income taxes 2,339 3,742 Provision for income taxes $ (6,962 ) $ (6,375 ) Net income Total reclassifications for the period $ (6,782 ) $ (6,010 ) Net income (a) See Note 12 for additional details. April 1, April 2, Description Revenue Cost of sales Revenue Cost of sales Total amount of income and expense line items presented in the Condensed Consolidated Statements of Income $ 810 $ (585 ) $ 1,040 $ (477 ) The effects of cash flow hedging: Gain or (loss) on cash flow hedging relationships in Subtopic 815-20: Foreign exchange contracts: Amount of gain or (loss) reclassified from accumulated other comprehensive income into net income $ 810 $ (527 ) $ 1,040 $ (725 ) Commodity contracts: Amount of gain or (loss) reclassified from accumulated other comprehensive income into net income $ — $ (58 ) $ — $ 248 |
Before and After Tax Amounts for Comprehensive Income (Loss) Components | The following table summarizes the before and after tax amounts for the various components of other comprehensive income/(loss) for the three-month periods ended April 1, 2018 and April 2, 2017 : Three months ended April 1, 2018 Three months ended April 2, 2017 Before Tax Amount Tax (Expense) Benefit After Tax Amount Before Tax Amount Tax (Expense) Benefit After Tax Amount Foreign currency items $ 22,553 $ — $ 22,553 $ 30,156 $ — $ 30,156 Defined benefit pension items: Other comprehensive income/(loss) before reclassifications (1,145 ) — (1,145 ) (147 ) 5,071 4,924 Amounts reclassified from accumulated other comprehensive income/(loss) to net income 9,301 (2,339 ) 6,962 10,117 (3,742 ) 6,375 Net other comprehensive income/(loss) from defined benefit pension items 8,156 (2,339 ) 5,817 9,970 1,329 11,299 Gains and losses on cash flow hedges: Other comprehensive income/(loss) before reclassifications 1,475 (293 ) 1,182 (4,048 ) 1,422 (2,626 ) Amounts reclassified from accumulated other comprehensive income/(loss) to net income (225 ) 45 (180 ) (563 ) 198 (365 ) Amounts reclassified from accumulated other comprehensive income/(loss) to fixed assets 45 — 45 42 — 42 Net other comprehensive income/(loss) from cash flow hedges 1,295 (248 ) 1,047 (4,569 ) 1,620 (2,949 ) Other comprehensive income/(loss) $ 32,004 $ (2,587 ) $ 29,417 $ 35,557 $ 2,949 $ 38,506 |
Goodwill and Other Intangible28
Goodwill and Other Intangible Assets (Tables) | 3 Months Ended |
Apr. 01, 2018 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Changes in Goodwill by Segment | A summary of the changes in goodwill by segment for the three months ended April 1, 2018 is as follows: Consumer Packaging Display and Packaging Paper and Industrial Converted Products Protective Solutions Total Goodwill at December 31, 2017 $ 572,716 $ 203,414 $ 233,778 $ 231,967 $ 1,241,875 Foreign currency translation 1,528 — 1,940 354 3,822 Other 7,180 — — — 7,180 Goodwill at April 1, 2018 $ 581,424 $ 203,414 $ 235,718 $ 232,321 $ 1,252,877 |
Summary of Other Intangible Assets | A summary of other intangible assets as of April 1, 2018 and December 31, 2017 is as follows: April 1, December 31, Other Intangible Assets, gross: Patents $ 21,956 $ 21,957 Customer lists 499,970 497,634 Trade names 25,161 25,148 Proprietary technology 20,792 20,779 Land use rights 303 298 Other 1,743 1,740 Other Intangible Assets, gross $ 569,925 $ 567,556 Accumulated Amortization: Patents (7,659 ) (7,187 ) Customer lists (220,589 ) (210,212 ) Trade names (4,930 ) (4,427 ) Proprietary technology (13,645 ) (13,192 ) Land use rights (50 ) (47 ) Other (1,284 ) (1,196 ) Total Accumulated Amortization $ (248,157 ) $ (236,261 ) Other Intangible Assets, net $ 321,768 $ 331,295 |
Financial Instruments and Der29
Financial Instruments and Derivatives (Tables) | 3 Months Ended |
Apr. 01, 2018 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Carrying Amounts and Fair Values of Financial Instruments | The following table sets forth the carrying amounts and fair values of the Company’s significant financial instruments for which the carrying amount differs from the fair value. April 1, 2018 December 31, 2017 Carrying Amount Fair Value Carrying Amount Fair Value Long-term debt, net of current portion $ 1,289,045 $ 1,407,163 $ 1,288,002 $ 1,426,862 |
Net Positions of Foreign Contracts | The Company has entered into forward contracts to hedge certain anticipated foreign currency denominated sales, purchases, and capital spending forecast to occur in 2018. The net positions of these contracts at April 1, 2018 were as follows (in thousands): Currency Action Quantity Colombian peso purchase 5,714,591 Mexican peso purchase 538,032 Polish zloty purchase 180,204 Canadian dollar purchase 40,162 Russian ruble purchase 24,491 Turkish lira purchase 3,856 British pound purchase 3,423 New Zealand dollar sell (464 ) Australian dollar sell (1,240 ) Euro sell (40,724 ) |
Net Positions of Other Derivatives Contracts | The net positions of these contracts at April 1, 2018 , were as follows (in thousands): Currency Action Quantity Colombian peso purchase 5,868,637 Mexican peso sell (15,638 ) Canadian dollar sell (59,117 ) |
Location and Fair Values of Derivative Instruments | The following table sets forth the location and fair values of the Company’s derivative instruments at April 1, 2018 and December 31, 2017 : Description Balance Sheet Location April 1, December 31, Derivatives designated as hedging instruments: Commodity Contracts Prepaid expenses $ — $ 149 Commodity Contracts Accrued expenses and other $ (1,448 ) $ (1,417 ) Commodity Contracts Other liabilities $ (378 ) $ (445 ) Foreign Exchange Contracts Prepaid expenses $ 2,964 $ 2,232 Foreign Exchange Contracts Accrued expenses and other $ (832 ) $ (1,282 ) Derivatives not designated as hedging instruments: Foreign Exchange Contracts Prepaid expenses $ 833 $ 90 Foreign Exchange Contracts Accrued expenses and other $ (662 ) $ (671 ) |
Effect of Derivative Instruments on Financial Performance | Description Description The following tables set forth the effect of the Company’s derivative instruments on financial performance for the three months ended April 1, 2018 and April 2, 2017 : Description Amount of Gain or (Loss) Recognized in OCI on Derivatives Location of Gain or (Loss) Reclassified from Accumulated OCI Into Income Amount of Gain or (Loss) Reclassified from Accumulated OCI Into Income Derivatives in Cash Flow Hedging Relationships: Three months ended April 1, 2018 Foreign Exchange Contracts $ 1,646 Net sales $ 810 Cost of sales $ (527 ) Commodity Contracts $ (171 ) Cost of sales $ (58 ) Three months ended April 2, 2017 Foreign Exchange Contracts $ (2,692 ) Net sales $ 1,040 Cost of sales $ (725 ) Commodity Contracts $ (1,356 ) Cost of sales $ 248 Description Location of Gain or (Loss) Recognized in Income Statement Gain or (Loss) Recognized Derivatives not Designated as Hedging Instruments: Three months ended April 1, 2018 Foreign Exchange Contracts Cost of sales $ — Selling, general and administrative $ 754 Three months ended April 2, 2017 Foreign Exchange Contracts Cost of sales $ — Selling, general and administrative $ (567 ) |
Reclassification of Gains and Losses | The following table summarizes the effects on net income of significant amounts reclassified from each component of accumulated other comprehensive loss for the three -month periods ended April 1, 2018 and April 2, 2017 : Amount Reclassified from Accumulated Other Comprehensive Loss Three Months Ended Details about Accumulated Other Comprehensive Loss Components April 1, April 2, Affected Line Item in the Condensed Consolidated Statements of Income Gains and losses on cash flow hedges Foreign exchange contracts $ 810 $ 1,040 Net sales Foreign exchange contracts (527 ) (725 ) Cost of sales Commodity contracts (58 ) 248 Cost of sales 225 563 Income before income taxes (45 ) (198 ) Provision for income taxes $ 180 $ 365 Net income Defined benefit pension items Amortization of defined benefit pension items (a) (9,301 ) (10,117 ) Non-operating pension (income)/cost (9,301 ) (10,117 ) Income before income taxes 2,339 3,742 Provision for income taxes $ (6,962 ) $ (6,375 ) Net income Total reclassifications for the period $ (6,782 ) $ (6,010 ) Net income (a) See Note 12 for additional details. April 1, April 2, Description Revenue Cost of sales Revenue Cost of sales Total amount of income and expense line items presented in the Condensed Consolidated Statements of Income $ 810 $ (585 ) $ 1,040 $ (477 ) The effects of cash flow hedging: Gain or (loss) on cash flow hedging relationships in Subtopic 815-20: Foreign exchange contracts: Amount of gain or (loss) reclassified from accumulated other comprehensive income into net income $ 810 $ (527 ) $ 1,040 $ (725 ) Commodity contracts: Amount of gain or (loss) reclassified from accumulated other comprehensive income into net income $ — $ (58 ) $ — $ 248 |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 3 Months Ended |
Apr. 01, 2018 | |
Fair Value Disclosures [Abstract] | |
Assets and Liabilities Measured on Recurring Basis | The following table sets forth information regarding the Company’s financial assets and financial liabilities, excluding retirement and postretirement plan assets, measured at fair value on a recurring basis: Description April 1, Assets measured at NAV Level 1 Level 2 Level 3 Hedge derivatives, net: Commodity contracts $ (1,826 ) $ — $ — $ (1,826 ) $ — Foreign exchange contracts $ 2,132 $ — $ — $ 2,132 $ — Non-hedge derivatives, net: Foreign exchange contracts $ 171 $ — $ — $ 171 $ — Deferred compensation plan assets $ 266 $ — $ 266 $ — $ — Description December 31, Assets measured at NAV Level 1 Level 2 Level 3 Hedge derivatives, net: Commodity contracts $ (1,713 ) $ — $ — $ (1,713 ) $ — Foreign exchange contracts $ 950 $ — $ — $ 950 $ — Non-hedge derivatives, net: Foreign exchange contracts $ (581 ) $ — $ — $ (581 ) $ — Deferred compensation plan assets $ 268 $ — $ 268 $ — $ — |
Employee Benefit Plans (Tables)
Employee Benefit Plans (Tables) | 3 Months Ended |
Apr. 01, 2018 | |
Retirement Benefits [Abstract] | |
Components of Net Periodic Benefit Cost | The components of net periodic benefit cost include the following: Three Months Ended April 1, April 2, Retirement Plans Service cost $ 4,672 $ 4,712 Interest cost 13,978 14,701 Expected return on plan assets (23,209 ) (20,838 ) Amortization of prior service cost 249 231 Amortization of net actuarial loss 9,420 10,168 Net periodic benefit cost $ 5,110 $ 8,974 Retiree Health and Life Insurance Plans Service cost $ 79 $ 84 Interest cost 111 120 Expected return on plan assets (472 ) (414 ) Amortization of prior service credit (126 ) (127 ) Amortization of net actuarial gain (242 ) (155 ) Net periodic benefit income $ (650 ) $ (492 ) |
Revenue Recognition (Tables)
Revenue Recognition (Tables) | 3 Months Ended |
Apr. 01, 2018 | |
Revenue from Contract with Customer [Abstract] | |
Receivables, Contracts Assets and Liabilities From Contracts With Customers | The following table sets forth information about receivables, contract assets and liabilities from contracts with customers. The balances of the contract assets and liabilities are located in "Other receivables" and "Accrued expenses and other" on the Condensed Consolidated Balance Sheets. April 1, 2018 January 1, 2018 As adjusted Contract Assets $ 49,721 $ 45,877 Contract Liabilities $ (5,476 ) $ (5,215 ) Significant changes in the contract assets and liabilities balances during the period were as follows: April 1, 2018 January 1, 2018 Adjusted Contract Asset Contract Liability Contract Asset Contract Liability Beginning Balance $ 45,877 $ (5,215 ) $ — $ — Revenue recognized that was included in the contract liabilities balance at the beginning of the period — (261 ) — — Increases due to cash received, excluding amounts recognized as revenue during the period 49,721 — — — Transferred to receivables from contract assets recognized at the beginning of the period (45,877 ) — — — Increase as a result of cumulative catch-up arising from changes in the estimate of completion, excluding amounts transferred to receivables during the period — — 45,877 (5,215 ) Impairment of contract asset — — — — Acquired as part of a business combinations — — — — Ending Balance $ 49,721 $ (5,476 ) $ 45,877 $ (5,215 ) |
Disaggregation of Revenue | The following table sets forth information about revenue disaggregated by primary geographic regions, and timing of revenue recognition for the three-month period ended April 1, 2018. The table also includes a reconciliation of disaggregated revenue with reportable segments. Consumer Packaging Display and Packaging Paper and Industrial Converted Products Protective Solutions Primary Geographical Markets: United States $ 397,986 $ 73,884 $ 265,762 $ 110,500 Europe 107,063 65,945 92,855 6,789 Canada 27,706 — 32,873 — Other 37,097 2,829 69,163 13,735 Total $ 569,852 $ 142,658 $ 460,653 $ 131,024 Timing of Revenue Recognition: Products transferred at a point in time $ 345,003 $ 64,715 $ 440,477 $ 111,798 Products transferred over time 224,849 77,943 20,176 19,226 Total $ 569,852 $ 142,658 $ 460,653 $ 131,024 |
Segment Reporting (Tables)
Segment Reporting (Tables) | 3 Months Ended |
Apr. 01, 2018 | |
Segment Reporting [Abstract] | |
Segment Financial Information | SEGMENT FINANCIAL INFORMATION Three Months Ended April 1, April 2, Net sales: Consumer Packaging $ 569,852 $ 482,181 Display and Packaging 142,658 114,635 Paper and Industrial Converted Products 460,653 442,502 Protective Solutions 131,024 133,006 Consolidated $ 1,304,187 $ 1,172,324 Intersegment sales: Consumer Packaging $ 739 $ 1,223 Display and Packaging 538 750 Paper and Industrial Converted Products 34,543 28,373 Protective Solutions 573 399 Consolidated $ 36,393 $ 30,745 Operating profit: Segment operating profit: Consumer Packaging $ 61,088 $ 59,460 Display and Packaging 1,732 3,222 Paper and Industrial Converted Products 39,781 26,850 Protective Solutions 10,680 10,931 Restructuring/Asset impairment charges (3,063 ) (4,111 ) Other, net (120 ) (2,693 ) Consolidated $ 110,098 $ 93,659 |
New Accounting Pronouncements -
New Accounting Pronouncements - Additional Information (Details) - USD ($) $ in Thousands | 3 Months Ended | |||
Apr. 01, 2018 | Apr. 02, 2017 | Oct. 02, 2016 | Jan. 01, 2018 | |
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||
Cost of sales | $ 1,053,585 | $ 949,345 | ||
Selling, general and administrative expenses | 137,441 | 125,209 | ||
Operating profit | 110,098 | $ 93,659 | $ 93,659 | |
Accounting Standards Update 2017-07 | ||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||
Cost of sales | (2,757) | |||
Selling, general and administrative expenses | (929) | |||
Operating profit | $ 3,686 | |||
Retained Earnings | Accounting Standards Update 2014-09 | ||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||
Cumulative effect, increase (decrease) | $ 1,721 | |||
New Accounting Pronouncement, Early Adoption, Effect | Retained Earnings | Accounting Standards Update 2017-12 | ||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||
Cumulative effect, increase (decrease) | $ 176 |
Changes in Accounting Policy -
Changes in Accounting Policy - Condensed Consolidated Balance Sheets (Details) - USD ($) $ in Thousands | Apr. 01, 2018 | Jan. 01, 2018 | Dec. 31, 2017 | [1] |
Current Assets | ||||
Trade accounts receivable, net of allowances | $ 756,102 | $ 725,251 | ||
Other receivables | 91,319 | 64,561 | ||
Inventories: | ||||
Finished and in process | 155,417 | 196,204 | ||
Total Assets | 4,653,069 | 4,557,721 | ||
Current Liabilities | ||||
Accrued expenses and other | 278,380 | 283,355 | ||
Total Current Liabilities | 1,035,374 | 999,970 | ||
Deferred Income Taxes | 72,303 | 74,073 | ||
Sonoco Shareholders’ Equity | ||||
Retained earnings | 2,072,423 | 2,036,006 | ||
Total Sonoco Shareholders’ Equity | 1,772,163 | 1,707,066 | ||
Total Equity | 1,796,456 | 1,730,060 | ||
Total Liabilities and Equity | 4,653,069 | $ 4,557,721 | ||
Before Topic 606 | ||||
Current Assets | ||||
Trade accounts receivable, net of allowances | 752,283 | $ 728,887 | ||
Other receivables | 46,830 | 105,912 | ||
Inventories: | ||||
Finished and in process | 195,487 | 158,757 | ||
Total Assets | 4,644,831 | 4,565,261 | ||
Current Liabilities | ||||
Accrued expenses and other | 272,904 | 288,570 | ||
Total Current Liabilities | 1,029,898 | 1,005,185 | ||
Deferred Income Taxes | 71,585 | 74,677 | ||
Sonoco Shareholders’ Equity | ||||
Retained earnings | 2,070,379 | 2,037,727 | ||
Total Sonoco Shareholders’ Equity | 1,770,119 | 1,708,787 | ||
Total Equity | 1,794,412 | 1,731,781 | ||
Total Liabilities and Equity | 4,644,831 | 4,565,261 | ||
Accounting Standards Update 2014-09 | Adjustments due to Topic 606 | ||||
Current Assets | ||||
Trade accounts receivable, net of allowances | (3,819) | 3,636 | ||
Other receivables | (44,489) | 41,351 | ||
Inventories: | ||||
Finished and in process | 40,070 | (37,447) | ||
Total Assets | (8,238) | 7,540 | ||
Current Liabilities | ||||
Accrued expenses and other | (5,476) | 5,215 | ||
Total Current Liabilities | (5,476) | 5,215 | ||
Deferred Income Taxes | (718) | 604 | ||
Sonoco Shareholders’ Equity | ||||
Retained earnings | (2,044) | 1,721 | ||
Total Sonoco Shareholders’ Equity | (2,044) | 1,721 | ||
Total Equity | (2,044) | 1,721 | ||
Total Liabilities and Equity | $ (8,238) | $ 7,540 | ||
[1] | The year-end condensed consolidated balance sheet data was derived from audited financial statements, but does not include all disclosures required by accounting principles generally accepted in the United States of America. |
Changes in Accounting Policy 36
Changes in Accounting Policy - Condensed Consolidated Statements of Income (Details) - USD ($) $ in Thousands | Jan. 01, 2018 | Apr. 01, 2018 | Apr. 02, 2017 | Oct. 02, 2016 |
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||
Net sales | $ 1,304,187 | $ 1,172,324 | ||
Cost of sales | 1,053,585 | 949,345 | ||
Gross profit | 250,602 | 222,979 | ||
Operating profit | 110,098 | 93,659 | $ 93,659 | |
Income before income taxes | 97,034 | 77,915 | ||
Provision for income taxes | 23,356 | 25,539 | $ 25,539 | |
Income before equity in earnings of affiliates | 73,678 | 52,376 | ||
Net income | 74,925 | 54,330 | ||
Net income attributable to Sonoco | 74,055 | $ 53,733 | ||
Accounting Standards Update 2014-09 | Adjustments due to Topic 606 | ||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||
Net sales | $ (3,060) | |||
Cost of sales | (2,623) | |||
Gross profit | (437) | |||
Operating profit | (437) | |||
Income before income taxes | (437) | |||
Provision for income taxes | (114) | |||
Income before equity in earnings of affiliates | (323) | |||
Net income | (323) | |||
Net income attributable to Sonoco | $ (323) | |||
Accounting Standards Update 2014-09 | Before Topic 606 | ||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||
Net sales | 1,301,127 | |||
Cost of sales | 1,050,962 | |||
Gross profit | 250,165 | |||
Operating profit | 109,661 | |||
Income before income taxes | 96,597 | |||
Provision for income taxes | 23,242 | |||
Income before equity in earnings of affiliates | 73,355 | |||
Net income | 74,602 | |||
Net income attributable to Sonoco | $ 73,732 |
Changes in Accounting Policy 37
Changes in Accounting Policy - Condensed Consolidated Statements of Comprehensive Income (Details) - USD ($) $ in Thousands | Jan. 01, 2018 | Apr. 01, 2018 | Apr. 02, 2017 |
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||
Net income | $ 74,925 | $ 54,330 | |
Comprehensive income | 104,772 | 93,516 | |
Comprehensive income attributable to Sonoco | 103,472 | $ 92,239 | |
Accounting Standards Update 2014-09 | Adjustments due to Topic 606 | |||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||
Net income | $ (323) | ||
Comprehensive income | (323) | ||
Comprehensive income attributable to Sonoco | $ (323) | ||
Accounting Standards Update 2014-09 | Before Topic 606 | |||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||
Net income | 74,602 | ||
Comprehensive income | 104,449 | ||
Comprehensive income attributable to Sonoco | $ 103,149 |
Changes in Accounting Policy 38
Changes in Accounting Policy - Condensed Consolidated Statements of Cash Flows (Details) - USD ($) $ in Thousands | Jan. 01, 2018 | Apr. 01, 2018 | Apr. 02, 2017 |
Cash Flows from Operating Activities: | |||
Net income | $ 74,925 | $ 54,330 | |
Trade accounts receivable | (19,346) | (10,002) | |
Inventories | (17,814) | (9,752) | |
Accrued expenses | (229) | (11,550) | |
Income taxes payable and other income tax items | 17,183 | 10,283 | |
Net cash provided by operating activities | 119,765 | $ 67,398 | |
Adjustments due to Topic 606 | Accounting Standards Update 2014-09 | |||
Cash Flows from Operating Activities: | |||
Net income | $ (323) | ||
Trade accounts receivable | 182 | ||
Inventories | 516 | ||
Accrued expenses | (261) | ||
Income taxes payable and other income tax items | (114) | ||
Net cash provided by operating activities | $ 0 | ||
Before Topic 606 | Accounting Standards Update 2014-09 | |||
Cash Flows from Operating Activities: | |||
Net income | 74,602 | ||
Trade accounts receivable | (19,164) | ||
Inventories | (17,298) | ||
Accrued expenses | (490) | ||
Income taxes payable and other income tax items | 17,069 | ||
Net cash provided by operating activities | $ 119,765 |
Acquisitions - Additional Infor
Acquisitions - Additional Information (Details) $ in Thousands | Apr. 12, 2020USD ($) | Apr. 12, 2019USD ($) | Apr. 12, 2018USD ($)installment_payment | Apr. 01, 2018USD ($) | Apr. 02, 2017USD ($) |
Business Acquisition [Line Items] | |||||
Cash consideration | $ 0 | $ 221,417 | |||
Acquisition related costs | 545 | $ 4,325 | |||
Term Loan Facility | Bank of America | Subsequent Event | |||||
Business Acquisition [Line Items] | |||||
Proceeds from lines of credit | $ 100,000 | ||||
Highland Packaging Solution | Forecast | |||||
Business Acquisition [Line Items] | |||||
Payment for contingent consideration | $ 2,500 | $ 5,000 | |||
Highland Packaging Solution | Subsequent Event | |||||
Business Acquisition [Line Items] | |||||
Consideration | 150,000 | ||||
Cash consideration | 142,500 | ||||
Contingent purchase liability | $ 7,500 | ||||
Number of installment payments | installment_payment | 2 | ||||
Plastic Packaging Inc. | |||||
Business Acquisition [Line Items] | |||||
Decrease to deferred tax assets | 6,516 | ||||
Increase to long-term debt | 664 | ||||
Increase to goodwill | $ 7,180 |
Shareholders' Equity - Earnings
Shareholders' Equity - Earnings Per Share (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | |
Apr. 01, 2018 | Apr. 02, 2017 | |
Numerator: | ||
Net income attributable to Sonoco | $ 74,055 | $ 53,733 |
Denominator: | ||
Basic (in shares) | 100,396 | 100,112 |
Dilutive effect of stock-based compensation (in shares) | 500 | 868 |
Diluted (in shares) | 100,896 | 100,980 |
Net income attributable to Sonoco per common share: | ||
Basic (in usd per share) | $ 0.74 | $ 0.54 |
Diluted (in usd per share) | $ 0.73 | $ 0.53 |
Shareholders' Equity - Antidilu
Shareholders' Equity - Antidilutive Securities (Details) - shares shares in Thousands | 3 Months Ended | |
Apr. 01, 2018 | Apr. 02, 2017 | |
Equity [Abstract] | ||
Anti-dilutive stock appreciation rights (in shares) | 738 | 356 |
Shareholders' Equity - Addition
Shareholders' Equity - Additional Information (Details) - USD ($) $ / shares in Units, $ in Thousands | Jun. 08, 2018 | May 11, 2018 | Apr. 18, 2018 | Mar. 09, 2018 | Feb. 28, 2018 | Feb. 14, 2018 | Apr. 01, 2018 | Apr. 02, 2017 | Dec. 31, 2016 | Feb. 10, 2016 |
Class of Stock [Line Items] | ||||||||||
Number of shares authorized for repurchase | 5,000,000 | |||||||||
Number of shares repurchased | 0 | 2,030,000 | ||||||||
Number of shares available for repurchase | 2,970,000 | |||||||||
Dividend declared date | Feb. 14, 2018 | |||||||||
Dividend declared and payable (in usd per share) | $ 0.39 | |||||||||
Dividend payable date | Mar. 9, 2018 | |||||||||
Dividend payable date of record | Feb. 28, 2018 | |||||||||
Forecast | ||||||||||
Class of Stock [Line Items] | ||||||||||
Dividend payable date | Jun. 8, 2018 | |||||||||
Dividend payable date of record | May 11, 2018 | |||||||||
Subsequent Event | ||||||||||
Class of Stock [Line Items] | ||||||||||
Dividend declared date | Apr. 18, 2018 | |||||||||
Dividend declared and payable (in usd per share) | $ 0.41 | |||||||||
Tax Withholding Obligations | ||||||||||
Class of Stock [Line Items] | ||||||||||
Number of shares repurchased | 78,000 | 105,000 | ||||||||
Cost of shares repurchased | $ 4,088 | $ 5,539 |
Restructuring and Asset Impai43
Restructuring and Asset Impairment - Restructuring and Asset Impairment Charges/ (Credits), Net (Details) - USD ($) $ in Thousands | 3 Months Ended | |||
Apr. 01, 2018 | Oct. 01, 2017 | Apr. 02, 2017 | Oct. 02, 2016 | |
Restructuring/Asset impairment: | ||||
Restructuring/Asset impairment charges | $ 3,063 | $ 4,111 | ||
Income tax benefit | (685) | (1,298) | ||
Less: Costs attributable to noncontrolling interests, net of tax | (5) | $ (5) | (2) | $ (2) |
Restructuring/asset impairment charges attributable to Sonoco, net of tax | 2,373 | 2,811 | ||
2018 Actions | ||||
Restructuring/Asset impairment: | ||||
Restructuring/Asset impairment charges | 2,207 | 0 | ||
2017 Actions | ||||
Restructuring/Asset impairment: | ||||
Restructuring/Asset impairment charges | 405 | 2,304 | ||
2016 and Earlier Actions | ||||
Restructuring/Asset impairment: | ||||
Restructuring/Asset impairment charges | $ 451 | $ 1,807 |
Restructuring and Asset Impai44
Restructuring and Asset Impairment - Additional Information (Details) $ in Thousands | 3 Months Ended | 12 Months Ended |
Apr. 01, 2018USD ($)position | Dec. 31, 2017USD ($)facilityposition | |
Restructuring Cost and Reserve [Line Items] | ||
Expected future charges associated with previous restructuring on earnings | $ 1,800 | |
Number of facilities closed | facility | 5 | |
2018 Actions | ||
Restructuring Cost and Reserve [Line Items] | ||
Number of eliminated positions | position | 20 | |
Asset impairment/disposal of assets | $ 2,207 | |
Proceeds from sale of building | 2,019 | |
Asset write off | 1,747 | |
2017 Actions | ||
Restructuring Cost and Reserve [Line Items] | ||
Number of eliminated positions | position | 255 | |
Asset impairment/disposal of assets | 405 | |
Proceeds from sale of building | 1,023 | |
Asset write off | 249 | |
2016 and Earlier Actions | ||
Restructuring Cost and Reserve [Line Items] | ||
Expected future charges associated with previous restructuring on earnings | 100 | |
Restructuring reserve | 2,189 | $ 3,044 |
Vacated land and building | 2018 Actions | ||
Restructuring Cost and Reserve [Line Items] | ||
Asset impairment/disposal of assets | 272 | |
Vacated land and building | 2017 Actions | ||
Restructuring Cost and Reserve [Line Items] | ||
Asset impairment/disposal of assets | $ 774 | |
United States | ||
Restructuring Cost and Reserve [Line Items] | ||
Number of facilities closed | facility | 3 | |
Belgium | ||
Restructuring Cost and Reserve [Line Items] | ||
Number of facilities closed | facility | 1 | |
China | ||
Restructuring Cost and Reserve [Line Items] | ||
Number of facilities closed | facility | 1 |
Restructuring and Asset Impai45
Restructuring and Asset Impairment - Actions and Related Expenses by Segment and by Type Incurred and Estimated for Given Years (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Apr. 01, 2018 | Apr. 02, 2017 | |
Restructuring Cost and Reserve [Line Items] | ||
Restructuring/asset impairment charges | $ 3,063 | $ 4,111 |
2018 Actions | ||
Restructuring Cost and Reserve [Line Items] | ||
Restructuring/asset impairment charges | 2,207 | 0 |
Estimated Total Cost | 3,657 | |
2017 Actions | ||
Restructuring Cost and Reserve [Line Items] | ||
Restructuring/asset impairment charges | 405 | 2,304 |
Total Incurred to Date | 15,734 | |
Estimated Total Cost | 15,934 | |
2017 Actions | Asset Impairment / Disposal of Assets | Protective Solutions | ||
Restructuring Cost and Reserve [Line Items] | ||
Restructuring/asset impairment charges | 0 | 0 |
Total Incurred to Date | 871 | |
Estimated Total Cost | 871 | |
2016 and Earlier Actions | ||
Restructuring Cost and Reserve [Line Items] | ||
Restructuring/asset impairment charges | 451 | 1,807 |
Operating Segments | 2018 Actions | Severance and Termination Benefits | Consumer Packaging | ||
Restructuring Cost and Reserve [Line Items] | ||
Restructuring/asset impairment charges | 788 | |
Estimated Total Cost | 938 | |
Operating Segments | 2018 Actions | Severance and Termination Benefits | Display and Packaging | ||
Restructuring Cost and Reserve [Line Items] | ||
Restructuring/asset impairment charges | 175 | |
Estimated Total Cost | 175 | |
Operating Segments | 2018 Actions | Severance and Termination Benefits | Paper and Industrial Converted Products | ||
Restructuring Cost and Reserve [Line Items] | ||
Restructuring/asset impairment charges | 991 | |
Estimated Total Cost | 991 | |
Operating Segments | 2018 Actions | Severance and Termination Benefits | Protective Solutions | ||
Restructuring Cost and Reserve [Line Items] | ||
Restructuring/asset impairment charges | 259 | |
Estimated Total Cost | 259 | |
Operating Segments | 2018 Actions | Asset Impairment / Disposal of Assets | Consumer Packaging | ||
Restructuring Cost and Reserve [Line Items] | ||
Restructuring/asset impairment charges | (14) | |
Estimated Total Cost | (14) | |
Operating Segments | 2018 Actions | Asset Impairment / Disposal of Assets | Protective Solutions | ||
Restructuring Cost and Reserve [Line Items] | ||
Restructuring/asset impairment charges | (272) | |
Estimated Total Cost | (272) | |
Operating Segments | 2018 Actions | Other Costs | Consumer Packaging | ||
Restructuring Cost and Reserve [Line Items] | ||
Restructuring/asset impairment charges | 11 | |
Estimated Total Cost | 311 | |
Operating Segments | 2018 Actions | Other Costs | Paper and Industrial Converted Products | ||
Restructuring Cost and Reserve [Line Items] | ||
Restructuring/asset impairment charges | 0 | |
Estimated Total Cost | 1,000 | |
Operating Segments | 2018 Actions | Other Costs | Protective Solutions | ||
Restructuring Cost and Reserve [Line Items] | ||
Restructuring/asset impairment charges | 46 | |
Estimated Total Cost | 46 | |
Operating Segments | 2017 Actions | Severance and Termination Benefits | Consumer Packaging | ||
Restructuring Cost and Reserve [Line Items] | ||
Restructuring/asset impairment charges | 372 | 967 |
Total Incurred to Date | 4,563 | |
Estimated Total Cost | 4,763 | |
Operating Segments | 2017 Actions | Severance and Termination Benefits | Display and Packaging | ||
Restructuring Cost and Reserve [Line Items] | ||
Restructuring/asset impairment charges | (8) | 106 |
Total Incurred to Date | 733 | |
Estimated Total Cost | 733 | |
Operating Segments | 2017 Actions | Severance and Termination Benefits | Paper and Industrial Converted Products | ||
Restructuring Cost and Reserve [Line Items] | ||
Restructuring/asset impairment charges | 4 | 541 |
Total Incurred to Date | 4,022 | |
Estimated Total Cost | 4,022 | |
Operating Segments | 2017 Actions | Severance and Termination Benefits | Protective Solutions | ||
Restructuring Cost and Reserve [Line Items] | ||
Restructuring/asset impairment charges | 133 | 75 |
Total Incurred to Date | 1,531 | |
Estimated Total Cost | 1,531 | |
Operating Segments | 2017 Actions | Asset Impairment / Disposal of Assets | Consumer Packaging | ||
Restructuring Cost and Reserve [Line Items] | ||
Restructuring/asset impairment charges | 0 | 0 |
Total Incurred to Date | 351 | |
Estimated Total Cost | 351 | |
Operating Segments | 2017 Actions | Asset Impairment / Disposal of Assets | Display and Packaging | ||
Restructuring Cost and Reserve [Line Items] | ||
Restructuring/asset impairment charges | 166 | 0 |
Total Incurred to Date | 166 | |
Estimated Total Cost | 166 | |
Operating Segments | 2017 Actions | Asset Impairment / Disposal of Assets | Paper and Industrial Converted Products | ||
Restructuring Cost and Reserve [Line Items] | ||
Restructuring/asset impairment charges | (665) | 0 |
Total Incurred to Date | (760) | |
Estimated Total Cost | (760) | |
Operating Segments | 2017 Actions | Other Costs | Consumer Packaging | ||
Restructuring Cost and Reserve [Line Items] | ||
Restructuring/asset impairment charges | 107 | 159 |
Total Incurred to Date | 986 | |
Estimated Total Cost | 986 | |
Operating Segments | 2017 Actions | Other Costs | Display and Packaging | ||
Restructuring Cost and Reserve [Line Items] | ||
Restructuring/asset impairment charges | (348) | 0 |
Total Incurred to Date | 441 | |
Estimated Total Cost | 441 | |
Operating Segments | 2017 Actions | Other Costs | Paper and Industrial Converted Products | ||
Restructuring Cost and Reserve [Line Items] | ||
Restructuring/asset impairment charges | 550 | 0 |
Total Incurred to Date | 1,551 | |
Estimated Total Cost | 1,551 | |
Operating Segments | 2017 Actions | Other Costs | Protective Solutions | ||
Restructuring Cost and Reserve [Line Items] | ||
Restructuring/asset impairment charges | 94 | 0 |
Total Incurred to Date | 836 | |
Estimated Total Cost | 836 | |
Operating Segments | 2016 and Earlier Actions | Consumer Packaging | ||
Restructuring Cost and Reserve [Line Items] | ||
Restructuring/asset impairment charges | 465 | (26) |
Operating Segments | 2016 and Earlier Actions | Display and Packaging | ||
Restructuring Cost and Reserve [Line Items] | ||
Restructuring/asset impairment charges | 1 | 395 |
Operating Segments | 2016 and Earlier Actions | Paper and Industrial Converted Products | ||
Restructuring Cost and Reserve [Line Items] | ||
Restructuring/asset impairment charges | (33) | 1,353 |
Operating Segments | 2016 and Earlier Actions | Protective Solutions | ||
Restructuring Cost and Reserve [Line Items] | ||
Restructuring/asset impairment charges | 18 | 78 |
Corporate | 2018 Actions | Severance and Termination Benefits | ||
Restructuring Cost and Reserve [Line Items] | ||
Restructuring/asset impairment charges | 223 | |
Estimated Total Cost | 223 | |
Corporate | 2017 Actions | Severance and Termination Benefits | ||
Restructuring Cost and Reserve [Line Items] | ||
Restructuring/asset impairment charges | 0 | 456 |
Total Incurred to Date | 452 | |
Estimated Total Cost | 452 | |
Corporate | 2017 Actions | Other Costs | ||
Restructuring Cost and Reserve [Line Items] | ||
Restructuring/asset impairment charges | 0 | 0 |
Total Incurred to Date | (9) | |
Estimated Total Cost | (9) | |
Corporate | 2016 and Earlier Actions | ||
Restructuring Cost and Reserve [Line Items] | ||
Restructuring/asset impairment charges | $ 0 | $ 7 |
Restructuring and Asset Impai46
Restructuring and Asset Impairment - Restructuring Accrual Activity for Given Years (Details) $ in Thousands | 3 Months Ended |
Apr. 01, 2018USD ($) | |
2018 Actions | |
Restructuring Reserve [Roll Forward] | |
Liability, beginning balance | $ 0 |
Current year charges | 2,207 |
Cash receipts/(payments) | 1,780 |
Asset write downs/disposals | (1,763) |
Foreign currency translation | (4) |
Liability, ending balance | 2,220 |
2017 Actions | |
Restructuring Reserve [Roll Forward] | |
Liability, beginning balance | 4,102 |
Current year charges | 405 |
Cash receipts/(payments) | (1,205) |
Asset write downs/disposals | (524) |
Foreign currency translation | 80 |
Liability, ending balance | 2,858 |
Severance and Termination Benefits | 2018 Actions | |
Restructuring Reserve [Roll Forward] | |
Liability, beginning balance | 0 |
Current year charges | 2,436 |
Cash receipts/(payments) | (259) |
Asset write downs/disposals | 0 |
Foreign currency translation | (4) |
Liability, ending balance | 2,173 |
Severance and Termination Benefits | 2017 Actions | |
Restructuring Reserve [Roll Forward] | |
Liability, beginning balance | 3,889 |
Current year charges | 501 |
Cash receipts/(payments) | (1,727) |
Asset write downs/disposals | 0 |
Foreign currency translation | 69 |
Liability, ending balance | 2,732 |
Asset Impairment / Disposal of Assets | 2018 Actions | |
Restructuring Reserve [Roll Forward] | |
Liability, beginning balance | 0 |
Current year charges | (286) |
Cash receipts/(payments) | 2,049 |
Asset write downs/disposals | (1,763) |
Foreign currency translation | 0 |
Liability, ending balance | 0 |
Asset Impairment / Disposal of Assets | 2017 Actions | |
Restructuring Reserve [Roll Forward] | |
Liability, beginning balance | 0 |
Current year charges | (499) |
Cash receipts/(payments) | 1,023 |
Asset write downs/disposals | (524) |
Foreign currency translation | 0 |
Liability, ending balance | 0 |
Other Costs | 2018 Actions | |
Restructuring Reserve [Roll Forward] | |
Liability, beginning balance | 0 |
Current year charges | 57 |
Cash receipts/(payments) | (10) |
Asset write downs/disposals | 0 |
Foreign currency translation | 0 |
Liability, ending balance | 47 |
Other Costs | 2017 Actions | |
Restructuring Reserve [Roll Forward] | |
Liability, beginning balance | 213 |
Current year charges | 403 |
Cash receipts/(payments) | (501) |
Asset write downs/disposals | 0 |
Foreign currency translation | 11 |
Liability, ending balance | $ 126 |
Accumulated Other Comprehensi47
Accumulated Other Comprehensive Loss - Components of Accumulated Other Comprehensive Loss (Details) - USD ($) $ in Thousands | 3 Months Ended | |||
Apr. 01, 2018 | Apr. 02, 2017 | Jan. 01, 2018 | ||
Accumulated Other Comprehensive Income (Loss), Net of Tax [Roll Forward] | ||||
Beginning Balance | [1] | $ 1,730,060 | ||
Other comprehensive income | 29,847 | $ 39,186 | ||
Ending Balance | 1,796,456 | |||
Gains and Losses on Cash Flow Hedges | ||||
Accumulated Other Comprehensive Income (Loss), Net of Tax [Roll Forward] | ||||
Beginning Balance | (641) | 1,939 | ||
Other comprehensive income/(loss) before reclassifications | 1,182 | (2,626) | ||
Other comprehensive income | 1,047 | (2,949) | ||
Amounts reclassified from retained earnings to accumulated other comprehensive loss | $ (176) | |||
Ending Balance | 230 | (1,010) | ||
Defined Benefit Pension Items | ||||
Accumulated Other Comprehensive Income (Loss), Net of Tax [Roll Forward] | ||||
Beginning Balance | (467,136) | (453,821) | ||
Other comprehensive income/(loss) before reclassifications | (1,145) | 4,924 | ||
Other comprehensive income | 5,817 | 11,299 | ||
Ending Balance | (461,319) | (442,522) | ||
Foreign Currency Items | ||||
Accumulated Other Comprehensive Income (Loss), Net of Tax [Roll Forward] | ||||
Beginning Balance | (198,495) | (286,498) | ||
Other comprehensive income/(loss) before reclassifications | 22,553 | 30,156 | ||
Other comprehensive income | 22,553 | 30,156 | ||
Ending Balance | (175,942) | (256,342) | ||
Accumulated Other Comprehensive Loss | ||||
Accumulated Other Comprehensive Income (Loss), Net of Tax [Roll Forward] | ||||
Beginning Balance | (666,272) | (738,380) | ||
Other comprehensive income/(loss) before reclassifications | 22,590 | 32,454 | ||
Other comprehensive income | 29,417 | 38,506 | ||
Amounts reclassified from retained earnings to accumulated other comprehensive loss | $ (176) | |||
Ending Balance | (637,031) | (699,874) | ||
Fixed Assets | Gains and Losses on Cash Flow Hedges | ||||
Accumulated Other Comprehensive Income (Loss), Net of Tax [Roll Forward] | ||||
Amounts reclassified from accumulated other comprehensive loss | 45 | 42 | ||
Fixed Assets | Accumulated Other Comprehensive Loss | ||||
Accumulated Other Comprehensive Income (Loss), Net of Tax [Roll Forward] | ||||
Amounts reclassified from accumulated other comprehensive loss | 45 | 42 | ||
Net Income | Gains and Losses on Cash Flow Hedges | ||||
Accumulated Other Comprehensive Income (Loss), Net of Tax [Roll Forward] | ||||
Amounts reclassified from accumulated other comprehensive loss | (180) | (365) | ||
Net Income | Defined Benefit Pension Items | ||||
Accumulated Other Comprehensive Income (Loss), Net of Tax [Roll Forward] | ||||
Amounts reclassified from accumulated other comprehensive loss | 6,962 | 6,375 | ||
Net Income | Accumulated Other Comprehensive Loss | ||||
Accumulated Other Comprehensive Income (Loss), Net of Tax [Roll Forward] | ||||
Amounts reclassified from accumulated other comprehensive loss | $ 6,782 | $ 6,010 | ||
[1] | The year-end condensed consolidated balance sheet data was derived from audited financial statements, but does not include all disclosures required by accounting principles generally accepted in the United States of America. |
Accumulated Other Comprehensi48
Accumulated Other Comprehensive Loss - Additional Information (Details) $ in Thousands | 3 Months Ended |
Apr. 02, 2017USD ($) | |
Subsidiaries | |
Accumulated Other Comprehensive Income (Loss) [Line Items] | |
Other comprehensive income/(loss) before reclassifications | $ 5,071 |
Accumulated Other Comprehensi49
Accumulated Other Comprehensive Loss - Effects on Net Income of Significant Amounts Reclassified from Accumulated Other Comprehensive Loss (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Apr. 01, 2018 | Apr. 02, 2017 | Oct. 02, 2016 | |
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | |||
Net sales | $ 1,304,187 | $ 1,172,324 | |
Cost of sales | (1,053,585) | (949,345) | |
Non-operating pension (income)/cost | (291) | 3,686 | |
Income before income taxes | 97,034 | 77,915 | |
Provision for income taxes | (23,356) | (25,539) | $ (25,539) |
Net income | 74,925 | 54,330 | |
Reclassification out of Accumulated Other Comprehensive Income | |||
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | |||
Net income | (6,782) | (6,010) | |
Reclassification out of Accumulated Other Comprehensive Income | Gains and losses on cash flow hedges | |||
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | |||
Net sales | 810 | 1,040 | |
Cost of sales | (585) | (477) | |
Income before income taxes | 225 | 563 | |
Provision for income taxes | (45) | (198) | |
Net income | 180 | 365 | |
Reclassification out of Accumulated Other Comprehensive Income | Amortization of defined benefit pension items | |||
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | |||
Non-operating pension (income)/cost | (9,301) | (10,117) | |
Reclassification out of Accumulated Other Comprehensive Income | Accumulated defined benefit plans adjustment | |||
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | |||
Income before income taxes | (9,301) | (10,117) | |
Provision for income taxes | 2,339 | 3,742 | |
Net income | (6,962) | (6,375) | |
Reclassification out of Accumulated Other Comprehensive Income | Foreign exchange contracts | Gains and losses on cash flow hedges | |||
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | |||
Net sales | 810 | 1,040 | |
Cost of sales | (527) | (725) | |
Reclassification out of Accumulated Other Comprehensive Income | Commodity contracts | Gains and losses on cash flow hedges | |||
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | |||
Net sales | 0 | 0 | |
Cost of sales | $ (58) | $ 248 |
Accumulated Other Comprehensi50
Accumulated Other Comprehensive Loss - Before and After Tax Amounts for Comprehensive Income (Loss) Components (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Apr. 01, 2018 | Apr. 02, 2017 | |
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||
Foreign currency translation adjustments | $ 22,983 | $ 30,836 |
Defined benefit pension items: | ||
Net other comprehensive income (loss) from defined benefit pension items, after tax | 5,817 | 11,299 |
Gains and losses on cash flow hedges: | ||
Net other comprehensive income (loss) from cash flow hedges, after tax | 1,047 | (2,949) |
Accumulated Other Comprehensive Loss | ||
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||
Foreign currency items, before tax | 22,553 | 30,156 |
Foreign currency items, tax (expense) benefit | 0 | 0 |
Foreign currency translation adjustments | 22,553 | 30,156 |
Defined benefit pension items: | ||
Other comprehensive (income) loss, before tax | (1,145) | (147) |
Other comprehensive (income) loss, tax (expense) benefit | 0 | 5,071 |
Other comprehensive (income) loss after tax | (1,145) | 4,924 |
Net other comprehensive income (loss) from defined benefit pension items, before tax | 8,156 | 9,970 |
Net other comprehensive income (loss) from defined benefit pension items, tax (expense) benefit | (2,339) | 1,329 |
Net other comprehensive income (loss) from defined benefit pension items, after tax | 5,817 | 11,299 |
Gains and losses on cash flow hedges: | ||
Other comprehensive income (loss) before reclassifications, before tax | 1,475 | (4,048) |
Other comprehensive income (loss) before reclassifications, tax (expense) benefit | (293) | 1,422 |
Other comprehensive income (loss) before reclassifications, after tax | 1,182 | (2,626) |
Net other comprehensive income (loss) from cash flow hedges, before tax | 1,295 | (4,569) |
Net other comprehensive income (loss) from cash flow hedges, tax (expense) benefit | (248) | 1,620 |
Net other comprehensive income (loss) from cash flow hedges, after tax | 1,047 | (2,949) |
Other comprehensive income (loss), before tax | 32,004 | 35,557 |
Other comprehensive income (loss), tax (expense) benefit | (2,587) | 2,949 |
Other comprehensive income (loss), after tax | 29,417 | 38,506 |
Fixed Assets | Accumulated Other Comprehensive Loss | ||
Gains and losses on cash flow hedges: | ||
Amounts reclassified from accumulated other comprehensive income (loss), before tax | 45 | 42 |
Amounts reclassified from accumulated other comprehensive income (loss), tax (expense) benefit | 0 | 0 |
Amounts reclassified from accumulated other comprehensive income (loss), after tax | 45 | 42 |
Net Income | Accumulated Other Comprehensive Loss | ||
Defined benefit pension items: | ||
Amounts reclassified from accumulated other comprehensive income (loss) to net income, before tax | 9,301 | 10,117 |
Amounts reclassified from accumulated other comprehensive income (loss) to net income, tax (expense) benefit | (2,339) | (3,742) |
Amounts reclassified from accumulated other comprehensive income (loss) to net income, after tax | 6,962 | 6,375 |
Gains and losses on cash flow hedges: | ||
Amounts reclassified from accumulated other comprehensive income (loss), before tax | (225) | (563) |
Amounts reclassified from accumulated other comprehensive income (loss), tax (expense) benefit | 45 | 198 |
Amounts reclassified from accumulated other comprehensive income (loss), after tax | $ (180) | $ (365) |
Goodwill and Other Intangible51
Goodwill and Other Intangible Assets - Changes in Goodwill by Segment (Details) $ in Thousands | 3 Months Ended | |
Apr. 01, 2018USD ($) | ||
Goodwill [Roll Forward] | ||
Goodwill, beginning balance | $ 1,241,875 | [1] |
Foreign currency translation | 3,822 | |
Other | 7,180 | |
Goodwill, ending balance | 1,252,877 | |
Consumer Packaging | ||
Goodwill [Roll Forward] | ||
Goodwill, beginning balance | 572,716 | |
Foreign currency translation | 1,528 | |
Other | 7,180 | |
Goodwill, ending balance | 581,424 | |
Display and Packaging | ||
Goodwill [Roll Forward] | ||
Goodwill, beginning balance | 203,414 | |
Foreign currency translation | 0 | |
Other | 0 | |
Goodwill, ending balance | 203,414 | |
Paper and Industrial Converted Products | ||
Goodwill [Roll Forward] | ||
Goodwill, beginning balance | 233,778 | |
Foreign currency translation | 1,940 | |
Other | 0 | |
Goodwill, ending balance | 235,718 | |
Protective Solutions | ||
Goodwill [Roll Forward] | ||
Goodwill, beginning balance | 231,967 | |
Foreign currency translation | 354 | |
Other | 0 | |
Goodwill, ending balance | $ 232,321 | |
[1] | The year-end condensed consolidated balance sheet data was derived from audited financial statements, but does not include all disclosures required by accounting principles generally accepted in the United States of America. |
Goodwill and Other Intangible52
Goodwill and Other Intangible Assets - Additional Information (Details) - USD ($) | Apr. 20, 2018 | Apr. 01, 2018 | Apr. 02, 2017 | Oct. 01, 2017 | Dec. 31, 2017 | |
Goodwill [Line Items] | ||||||
Goodwill | $ 1,252,877,000 | $ 1,241,875,000 | [1] | |||
Net sales | 1,304,187,000 | $ 1,172,324,000 | ||||
Impairment charge (less than) | 162,000 | 337,000 | ||||
Aggregate amortization expense | 10,202,000 | $ 7,211,000 | ||||
Amortization expense on other intangible assets in 2018 | 43,400,000 | |||||
Amortization expense on other intangible assets in 2019 | 42,300,000 | |||||
Amortization expense on other intangible assets in 2020 | 39,900,000 | |||||
Amortization expense on other intangible assets in 2021 | 38,900,000 | |||||
Amortization expense on other intangible assets in 2022 | $ 37,100,000 | |||||
Minimum | ||||||
Goodwill [Line Items] | ||||||
Useful lives of other intangible assets | 3 years | |||||
Maximum | ||||||
Goodwill [Line Items] | ||||||
Useful lives of other intangible assets | 40 years | |||||
Paper and Industrial Converted Products - Europe Reporting Unit | ||||||
Goodwill [Line Items] | ||||||
Goodwill | $ 97,065,000 | |||||
Other Segments | ||||||
Goodwill [Line Items] | ||||||
Goodwill, impairment loss | $ 0 | |||||
Display and Packaging | ||||||
Goodwill [Line Items] | ||||||
Goodwill | 203,414,000 | $ 203,414,000 | ||||
Display and Packaging | Display and Packaging Reporting Unit | ||||||
Goodwill [Line Items] | ||||||
Goodwill | 203,414,000 | |||||
Plastic Packaging Inc. | ||||||
Goodwill [Line Items] | ||||||
Increase to goodwill | 7,180,000 | |||||
One Display and Packaging Segment Customer | Display and Packaging | ||||||
Goodwill [Line Items] | ||||||
Net sales | $ 12,000,000 | |||||
Percentage of total annual sales | 2.40% | |||||
Forecast | Display and Packaging | ||||||
Goodwill [Line Items] | ||||||
Impairment charge (less than) | $ 20,000,000 | |||||
[1] | The year-end condensed consolidated balance sheet data was derived from audited financial statements, but does not include all disclosures required by accounting principles generally accepted in the United States of America. |
Goodwill and Other Intangible53
Goodwill and Other Intangible Assets - Summary of Other Intangible Assets (Details) - USD ($) $ in Thousands | Apr. 01, 2018 | Dec. 31, 2017 | |
Other Intangible Assets, gross: | |||
Other Intangible Assets, gross | $ 569,925 | $ 567,556 | |
Accumulated Amortization | (248,157) | (236,261) | |
Other Intangible Assets, net | 321,768 | 331,295 | [1] |
Patents | |||
Other Intangible Assets, gross: | |||
Other Intangible Assets, gross | 21,956 | 21,957 | |
Accumulated Amortization | (7,659) | (7,187) | |
Customer lists | |||
Other Intangible Assets, gross: | |||
Other Intangible Assets, gross | 499,970 | 497,634 | |
Accumulated Amortization | (220,589) | (210,212) | |
Trade names | |||
Other Intangible Assets, gross: | |||
Other Intangible Assets, gross | 25,161 | 25,148 | |
Accumulated Amortization | (4,930) | (4,427) | |
Proprietary technology | |||
Other Intangible Assets, gross: | |||
Other Intangible Assets, gross | 20,792 | 20,779 | |
Accumulated Amortization | (13,645) | (13,192) | |
Land use rights | |||
Other Intangible Assets, gross: | |||
Other Intangible Assets, gross | 303 | 298 | |
Accumulated Amortization | (50) | (47) | |
Other | |||
Other Intangible Assets, gross: | |||
Other Intangible Assets, gross | 1,743 | 1,740 | |
Accumulated Amortization | $ (1,284) | $ (1,196) | |
[1] | The year-end condensed consolidated balance sheet data was derived from audited financial statements, but does not include all disclosures required by accounting principles generally accepted in the United States of America. |
Debt - Additional Information (
Debt - Additional Information (Details) - Term Loan Facility - Bank of America - Subsequent Event | Apr. 12, 2018USD ($)extension_option |
Line of Credit Facility [Line Items] | |
Maximum borrowing capacity | $ | $ 100,000,000 |
Debt term | 364 days |
Additional debt term | 364 days |
Number of extension options | extension_option | 1 |
LIBOR | |
Line of Credit Facility [Line Items] | |
Basis points | 1.10% |
Financial Instruments and Der55
Financial Instruments and Derivatives - Carrying Amount and Fair Values of Financial Instruments (Details) - USD ($) $ in Thousands | Apr. 01, 2018 | Dec. 31, 2017 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |||
Long-term debt, net of current portion, carrying amount | $ 1,289,045 | $ 1,288,002 | [1] |
Long-term debt, net of current portion, fair value | $ 1,407,163 | $ 1,426,862 | |
[1] | The year-end condensed consolidated balance sheet data was derived from audited financial statements, but does not include all disclosures required by accounting principles generally accepted in the United States of America. |
Financial Instruments and Der56
Financial Instruments and Derivatives - Additional Information (Details) $ in Thousands, MMBTU in Millions | 3 Months Ended | |||
Apr. 01, 2018USD ($)MMBTUT | Apr. 02, 2017USD ($) | Jan. 01, 2018USD ($) | Dec. 31, 2017USD ($) | |
Derivative [Line Items] | ||||
Fair value of commodity cash flow hedges, gain (loss) | $ (1,826) | $ (1,713) | ||
Commodity gain (loss) expected to be reclassified to the income statement during the next 12 months | (1,303) | |||
Fair value of foreign currency cash flow hedges, gain (loss) | 1,837 | 620 | ||
Foreign currency gain (loss) expected to be reclassified to the income statement during the next 12 months | 1,837 | |||
Total fair value of other derivatives not designated as hedging instruments | 171 | (581) | ||
Accumulated Other Comprehensive Loss | ||||
Derivative [Line Items] | ||||
Cumulative effect, increase (decrease) | $ (176) | |||
Accumulated Other Comprehensive Loss | Fixed Assets | ||||
Derivative [Line Items] | ||||
Amounts reclassified from accumulated other comprehensive loss | $ 45 | $ 42 | ||
Natural Gas Swaps | ||||
Derivative [Line Items] | ||||
Approximate amount of commodity covered by swap contracts outstanding (in MMBTUs) | MMBTU | 6 | |||
Anticipated usage percentage covered by a swap contract for the current fiscal year | 74.00% | |||
Anticipated usage percentage covered by a swap contract for the second succeeding fiscal year (less than) | 32.00% | |||
Aluminum Swaps | ||||
Derivative [Line Items] | ||||
Anticipated usage percentage covered by a swap contract for the current fiscal year | 51.00% | |||
Approximate amount of commodity covered by swap contracts outstanding (in tons) | T | 2,858 | |||
Foreign Exchange Forward For Construction In Progress | ||||
Derivative [Line Items] | ||||
Net position of contracts | $ 295 | $ 330 | ||
Accounting Standards Update 2017-12 | New Accounting Pronouncement, Early Adoption, Effect | Retained Earnings | ||||
Derivative [Line Items] | ||||
Cumulative effect, increase (decrease) | 176 | |||
Accounting Standards Update 2017-12 | New Accounting Pronouncement, Early Adoption, Effect | Accumulated Other Comprehensive Loss | ||||
Derivative [Line Items] | ||||
Cumulative effect, increase (decrease) | $ (176) |
Financial Instruments and Der57
Financial Instruments and Derivatives - Net Positions of Foreign Contracts (Details) - Apr. 01, 2018 ₽ in Thousands, ₺ in Thousands, € in Thousands, £ in Thousands, zł in Thousands, $ in Thousands, $ in Thousands, $ in Thousands, $ in Thousands, $ in Thousands | AUD ($) | RUB (₽) | TRY (₺) | GBP (£) | COP ($) | CAD ($) | PLN (zł) | EUR (€) | MXN ($) | NZD ($) |
Cash Flow Hedging | purchase | ||||||||||
Derivative [Line Items] | ||||||||||
Net position, purchase (sell) | $ 5,714,591 | $ 40,162 | $ 538,032 | |||||||
Cash Flow Hedging | purchase | ||||||||||
Derivative [Line Items] | ||||||||||
Net position, purchase (sell) | ₽ 24,491 | ₺ 3,856 | £ 3,423 | zł 180,204 | ||||||
Cash Flow Hedging | sell | ||||||||||
Derivative [Line Items] | ||||||||||
Net position, purchase (sell) | $ 1,240 | € 40,724 | $ 464 |
Financial Instruments and Der58
Financial Instruments and Derivatives - Net Positions of Other Derivatives Contract (Details) - Apr. 01, 2018 - Derivatives Not Designated as Hedging Instruments $ in Thousands, $ in Thousands, $ in Thousands | COP ($) | CAD ($) | MXN ($) |
purchase | |||
Derivative [Line Items] | |||
Net position | $ 5,868,637 | ||
sell | |||
Derivative [Line Items] | |||
Net position | $ 59,117 | $ 15,638 |
Financial Instruments and Der59
Financial Instruments and Derivatives - Location and Fair Values of Derivative Instruments (Details) - USD ($) $ in Thousands | Apr. 01, 2018 | Dec. 31, 2017 |
Derivatives Designated as Hedging Instruments | Commodity contracts | Prepaid expenses | ||
Derivatives, Fair Value [Line Items] | ||
Derivative asset | $ 0 | $ 149 |
Derivatives Designated as Hedging Instruments | Commodity contracts | Accrued expenses and other | ||
Derivatives, Fair Value [Line Items] | ||
Derivative liability | (1,448) | (1,417) |
Derivatives Designated as Hedging Instruments | Commodity contracts | Other liabilities | ||
Derivatives, Fair Value [Line Items] | ||
Derivative liability | (378) | (445) |
Derivatives Designated as Hedging Instruments | Foreign exchange contracts | Prepaid expenses | ||
Derivatives, Fair Value [Line Items] | ||
Derivative asset | 2,964 | 2,232 |
Derivatives Designated as Hedging Instruments | Foreign exchange contracts | Accrued expenses and other | ||
Derivatives, Fair Value [Line Items] | ||
Derivative liability | (832) | (1,282) |
Derivatives Not Designated as Hedging Instruments | Foreign exchange contracts | Prepaid expenses | ||
Derivatives, Fair Value [Line Items] | ||
Derivative asset | 833 | 90 |
Derivatives Not Designated as Hedging Instruments | Foreign exchange contracts | Accrued expenses and other | ||
Derivatives, Fair Value [Line Items] | ||
Derivative liability | $ (662) | $ (671) |
Financial Instruments and Der60
Financial Instruments and Derivatives - Effect of Derivative Instruments on Financial Performance (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Apr. 01, 2018 | Apr. 02, 2017 | |
Foreign exchange contracts | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Amount of Gain or (Loss) Recognized in OCI on Derivatives | $ 1,646 | $ (2,692) |
Foreign exchange contracts | Net sales | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Amount of Gain or (Loss) Reclassified from Accumulated OCI Into Income | 810 | 1,040 |
Foreign exchange contracts | Cost of sales | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Amount of Gain or (Loss) Reclassified from Accumulated OCI Into Income | (527) | (725) |
Foreign exchange contracts | Cost of sales | Not Designated as Hedging Instrument | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Gain or (Loss) Recognized | 0 | 0 |
Foreign exchange contracts | Selling, general and administrative | Not Designated as Hedging Instrument | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Gain or (Loss) Recognized | 754 | (567) |
Commodity contracts | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Amount of Gain or (Loss) Recognized in OCI on Derivatives | (171) | (1,356) |
Commodity contracts | Cost of sales | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Amount of Gain or (Loss) Reclassified from Accumulated OCI Into Income | $ (58) | $ 248 |
Financial Instruments and Der61
Financial Instruments and Derivatives - Reclassification of Gains and Losses (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Apr. 01, 2018 | Apr. 02, 2017 | |
Reclassification Adjustment out of Accumulated Other Comprehensive Income on Derivatives [Line Items] | ||
Revenue | $ 1,304,187 | $ 1,172,324 |
Cost of sales | (1,053,585) | (949,345) |
Gains and losses on cash flow hedges | Reclassification out of Accumulated Other Comprehensive Income | ||
Reclassification Adjustment out of Accumulated Other Comprehensive Income on Derivatives [Line Items] | ||
Revenue | 810 | 1,040 |
Cost of sales | (585) | (477) |
Foreign exchange contracts | Gains and losses on cash flow hedges | Reclassification out of Accumulated Other Comprehensive Income | ||
Reclassification Adjustment out of Accumulated Other Comprehensive Income on Derivatives [Line Items] | ||
Revenue | 810 | 1,040 |
Cost of sales | (527) | (725) |
Commodity contracts | Gains and losses on cash flow hedges | Reclassification out of Accumulated Other Comprehensive Income | ||
Reclassification Adjustment out of Accumulated Other Comprehensive Income on Derivatives [Line Items] | ||
Revenue | 0 | 0 |
Cost of sales | $ (58) | $ 248 |
Fair Value Measurements - Asset
Fair Value Measurements - Assets and Liabilities Measured on Recurring Basis (Details) - USD ($) $ in Thousands | Apr. 01, 2018 | Dec. 31, 2017 |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Assets measured at NAV | $ 0 | $ 0 |
Deferred compensation plan assets | 266 | 268 |
Derivatives Designated as Hedging Instruments | Commodity contracts | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Derivatives | (1,826) | (1,713) |
Assets measured at NAV | 0 | 0 |
Derivatives Designated as Hedging Instruments | Foreign exchange contracts | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Derivatives | 2,132 | 950 |
Assets measured at NAV | 0 | 0 |
Derivatives Not Designated as Hedging Instruments | Foreign exchange contracts | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Derivatives | 171 | (581) |
Assets measured at NAV | 0 | 0 |
Level 1 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Deferred compensation plan assets | 266 | 268 |
Level 1 | Derivatives Designated as Hedging Instruments | Commodity contracts | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Derivatives | 0 | 0 |
Level 1 | Derivatives Designated as Hedging Instruments | Foreign exchange contracts | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Derivatives | 0 | 0 |
Level 1 | Derivatives Not Designated as Hedging Instruments | Foreign exchange contracts | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Derivatives | 0 | 0 |
Level 2 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Deferred compensation plan assets | 0 | 0 |
Level 2 | Derivatives Designated as Hedging Instruments | Commodity contracts | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Derivatives | (1,826) | (1,713) |
Level 2 | Derivatives Designated as Hedging Instruments | Foreign exchange contracts | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Derivatives | 2,132 | 950 |
Level 2 | Derivatives Not Designated as Hedging Instruments | Foreign exchange contracts | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Derivatives | 171 | (581) |
Level 3 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Deferred compensation plan assets | 0 | 0 |
Level 3 | Derivatives Designated as Hedging Instruments | Commodity contracts | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Derivatives | 0 | 0 |
Level 3 | Derivatives Designated as Hedging Instruments | Foreign exchange contracts | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Derivatives | 0 | 0 |
Level 3 | Derivatives Not Designated as Hedging Instruments | Foreign exchange contracts | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Derivatives | $ 0 | $ 0 |
Employee Benefit Plans - Additi
Employee Benefit Plans - Additional Information (Details) - USD ($) | 3 Months Ended | |
Apr. 01, 2018 | Apr. 02, 2017 | |
Defined Benefit Plan Disclosure [Line Items] | ||
Contributions | $ 4,573,000 | $ 29,491,000 |
Expected contributions for remainder of fiscal year | 20,000,000 | |
Pension Plan | Sonoco Retirement Contribution | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Contributions | 14,151,000 | 14,066,000 |
Expected contributions for remainder of fiscal year | 0 | |
Recognized expense related to the plan | $ 4,032,000 | $ 3,871,000 |
Pension Plan | United States | Sonoco Retirement Contribution | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Employer matching contribution, percent of employees' gross pay | 4.00% | |
Employer matching contribution, percent of employees' gross pay in excess of social security | 4.00% |
Employee Benefit Plans - Compon
Employee Benefit Plans - Components of Net Periodic Benefit Cost (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Apr. 01, 2018 | Apr. 02, 2017 | |
Retirement Plans | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Service cost | $ 4,672 | $ 4,712 |
Interest cost | 13,978 | 14,701 |
Expected return on plan assets | (23,209) | (20,838) |
Amortization of prior service cost (credit) | 249 | 231 |
Amortization of net actuarial loss (gain) | 9,420 | 10,168 |
Net periodic benefit cost (income) | 5,110 | 8,974 |
Retiree Health and Life Insurance Plans | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Service cost | 79 | 84 |
Interest cost | 111 | 120 |
Expected return on plan assets | (472) | (414) |
Amortization of prior service cost (credit) | (126) | (127) |
Amortization of net actuarial loss (gain) | (242) | (155) |
Net periodic benefit cost (income) | $ (650) | $ (492) |
Income Taxes - Additional Infor
Income Taxes - Additional Information (Details) $ in Thousands | Oct. 05, 2017USD ($)notice_of_proposed_adjustment | Mar. 31, 2017USD ($) | Apr. 01, 2018USD ($) | Apr. 02, 2017 | Nov. 14, 2017notice_of_proposed_adjustment |
Income Tax Contingency [Line Items] | |||||
Effective tax rate | 24.10% | 32.80% | |||
Increase of uncertain tax benefits | $ 1,000 | ||||
Reserves for uncertain tax benefits, decrease | $ 800 | ||||
Number of draft notice of proposed adjustments, revised | notice_of_proposed_adjustment | 2 | ||||
Number of notice of proposed adjustments | notice_of_proposed_adjustment | 2 | ||||
Internal Revenue Service (IRS) | |||||
Income Tax Contingency [Line Items] | |||||
Penalties expense | $ 18,000 | ||||
Tax examination, possible loss | $ 89,000 |
Revenue Recognition - Additiona
Revenue Recognition - Additional Information (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Apr. 01, 2018 | Jan. 01, 2018 | |
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||
Payment terms | 120 days | |
Accounting Standards Update 2014-09 | Retained Earnings | ||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||
Cumulative effect, increase (decrease) | $ 1,721 |
Revenue Recognition - Receivabl
Revenue Recognition - Receivables, Contract Assets and Liabilities from Contracts with Customer (Details) - USD ($) $ in Thousands | Apr. 01, 2018 | Jan. 01, 2018 | Dec. 31, 2017 |
Revenue from Contract with Customer [Abstract] | |||
Contract Assets | $ 49,721 | $ 45,877 | $ 45,877 |
Contract Liabilities | $ (5,476) | $ (5,215) | $ (5,215) |
Revenue Recognition - Significa
Revenue Recognition - Significant Changes in the Contract Assets and Liabilities Balances (Details) - USD ($) $ in Thousands | Jan. 01, 2018 | Apr. 01, 2018 |
Contract Asset | ||
Beginning Balance | $ 45,877 | $ 45,877 |
Increases due to cash received, excluding amounts recognized as revenue during the period | 49,721 | |
Transferred to receivables from contract assets recognized at the beginning of the period | (45,877) | |
Increase as a result of cumulative catch-up arising from changes in the estimate of completion, excluding amounts transferred to receivables during the period | 0 | |
Impairment of contract asset | 0 | |
Acquired as part of a business combinations | 0 | |
Ending Balance | 45,877 | 49,721 |
Contract Liability | ||
Beginning Balance | (5,215) | (5,215) |
Revenue recognized that was included in the contract liabilities balance at the beginning of the period | (261) | |
Increase as a result of cumulative catch-up arising from changes in the estimate of completion, excluding amounts transferred to receivables during the period | 0 | |
Ending Balance | (5,215) | (5,476) |
Scenario, Previously Reported | ||
Contract Asset | ||
Beginning Balance | 0 | 0 |
Contract Liability | ||
Beginning Balance | 0 | $ 0 |
Scenario, Adjustment | ||
Contract Asset | ||
Increases due to cash received, excluding amounts recognized as revenue during the period | 0 | |
Transferred to receivables from contract assets recognized at the beginning of the period | 0 | |
Increase as a result of cumulative catch-up arising from changes in the estimate of completion, excluding amounts transferred to receivables during the period | 45,877 | |
Impairment of contract asset | 0 | |
Acquired as part of a business combinations | 0 | |
Contract Liability | ||
Increase as a result of cumulative catch-up arising from changes in the estimate of completion, excluding amounts transferred to receivables during the period | $ (5,215) |
Revenue Recognition - Disaggreg
Revenue Recognition - Disaggregation of Revenue (Details) $ in Thousands | 3 Months Ended |
Apr. 01, 2018USD ($) | |
Consumer Packaging | |
Disaggregation of Revenue [Line Items] | |
Revenue | $ 569,852 |
Consumer Packaging | Products transferred at a point in time | |
Disaggregation of Revenue [Line Items] | |
Revenue | 345,003 |
Consumer Packaging | Products transferred over time | |
Disaggregation of Revenue [Line Items] | |
Revenue | 224,849 |
Consumer Packaging | United States | |
Disaggregation of Revenue [Line Items] | |
Revenue | 397,986 |
Consumer Packaging | Europe | |
Disaggregation of Revenue [Line Items] | |
Revenue | 107,063 |
Consumer Packaging | Canada | |
Disaggregation of Revenue [Line Items] | |
Revenue | 27,706 |
Consumer Packaging | Other | |
Disaggregation of Revenue [Line Items] | |
Revenue | 37,097 |
Display and Packaging | |
Disaggregation of Revenue [Line Items] | |
Revenue | 142,658 |
Display and Packaging | Products transferred at a point in time | |
Disaggregation of Revenue [Line Items] | |
Revenue | 64,715 |
Display and Packaging | Products transferred over time | |
Disaggregation of Revenue [Line Items] | |
Revenue | 77,943 |
Display and Packaging | United States | |
Disaggregation of Revenue [Line Items] | |
Revenue | 73,884 |
Display and Packaging | Europe | |
Disaggregation of Revenue [Line Items] | |
Revenue | 65,945 |
Display and Packaging | Canada | |
Disaggregation of Revenue [Line Items] | |
Revenue | 0 |
Display and Packaging | Other | |
Disaggregation of Revenue [Line Items] | |
Revenue | 2,829 |
Paper and Industrial Converted Products | |
Disaggregation of Revenue [Line Items] | |
Revenue | 460,653 |
Paper and Industrial Converted Products | Products transferred at a point in time | |
Disaggregation of Revenue [Line Items] | |
Revenue | 440,477 |
Paper and Industrial Converted Products | Products transferred over time | |
Disaggregation of Revenue [Line Items] | |
Revenue | 20,176 |
Paper and Industrial Converted Products | United States | |
Disaggregation of Revenue [Line Items] | |
Revenue | 265,762 |
Paper and Industrial Converted Products | Europe | |
Disaggregation of Revenue [Line Items] | |
Revenue | 92,855 |
Paper and Industrial Converted Products | Canada | |
Disaggregation of Revenue [Line Items] | |
Revenue | 32,873 |
Paper and Industrial Converted Products | Other | |
Disaggregation of Revenue [Line Items] | |
Revenue | 69,163 |
Protective Solutions | |
Disaggregation of Revenue [Line Items] | |
Revenue | 131,024 |
Protective Solutions | Products transferred at a point in time | |
Disaggregation of Revenue [Line Items] | |
Revenue | 111,798 |
Protective Solutions | Products transferred over time | |
Disaggregation of Revenue [Line Items] | |
Revenue | 19,226 |
Protective Solutions | United States | |
Disaggregation of Revenue [Line Items] | |
Revenue | 110,500 |
Protective Solutions | Europe | |
Disaggregation of Revenue [Line Items] | |
Revenue | 6,789 |
Protective Solutions | Canada | |
Disaggregation of Revenue [Line Items] | |
Revenue | 0 |
Protective Solutions | Other | |
Disaggregation of Revenue [Line Items] | |
Revenue | $ 13,735 |
Segment Reporting - Additional
Segment Reporting - Additional Information (Details) | 3 Months Ended |
Apr. 01, 2018segment | |
Segment Reporting [Abstract] | |
Number of reportable segments | 4 |
Segment Reporting - Segment Fin
Segment Reporting - Segment Financial Information (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Apr. 01, 2018 | Apr. 02, 2017 | Oct. 02, 2016 | |
Segment Reporting Information [Line Items] | |||
Net sales | $ 1,304,187 | $ 1,172,324 | |
Operating profit | 110,098 | 93,659 | $ 93,659 |
Restructuring/Asset impairment charges | (3,063) | (4,111) | |
Operating Segments | Consumer Packaging | |||
Segment Reporting Information [Line Items] | |||
Net sales | 569,852 | 482,181 | |
Operating profit | 61,088 | 59,460 | |
Operating Segments | Display and Packaging | |||
Segment Reporting Information [Line Items] | |||
Net sales | 142,658 | 114,635 | |
Operating profit | 1,732 | 3,222 | |
Operating Segments | Paper and Industrial Converted Products | |||
Segment Reporting Information [Line Items] | |||
Net sales | 460,653 | 442,502 | |
Operating profit | 39,781 | 26,850 | |
Operating Segments | Protective Solutions | |||
Segment Reporting Information [Line Items] | |||
Net sales | 131,024 | 133,006 | |
Operating profit | 10,680 | 10,931 | |
Intersegment Sales | |||
Segment Reporting Information [Line Items] | |||
Net sales | 36,393 | 30,745 | |
Intersegment Sales | Consumer Packaging | |||
Segment Reporting Information [Line Items] | |||
Net sales | 739 | 1,223 | |
Intersegment Sales | Display and Packaging | |||
Segment Reporting Information [Line Items] | |||
Net sales | 538 | 750 | |
Intersegment Sales | Paper and Industrial Converted Products | |||
Segment Reporting Information [Line Items] | |||
Net sales | 34,543 | 28,373 | |
Intersegment Sales | Protective Solutions | |||
Segment Reporting Information [Line Items] | |||
Net sales | 573 | 399 | |
Segment Reconciling Items | |||
Segment Reporting Information [Line Items] | |||
Other, net | $ (120) | $ (2,693) |
Commitments and Contingencies -
Commitments and Contingencies - Additional Information (Details) - USD ($) $ in Thousands | 68 Months Ended | 72 Months Ended | ||
Jul. 02, 2017 | Dec. 31, 2017 | Apr. 01, 2018 | Nov. 30, 2011 | |
Site Contingency [Line Items] | ||||
Environmental accrual | $ 20,306 | $ 19,731 | ||
Spartanburg, South Carolina Site | Tegrant Holding Corporation | ||||
Site Contingency [Line Items] | ||||
Environmental accrual | 16,504 | 16,342 | $ 17,400 | |
Payment towards remediation of sites | $ 1,075 | |||
Increase of reserves | 17 | |||
Multiple Sites | ||||
Site Contingency [Line Items] | ||||
Environmental accrual | $ 3,802 | $ 3,389 |