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Share Name | Share Symbol | Market | Type |
---|---|---|---|
Hormel Foods Corporation | NYSE:HRL | NYSE | Common Stock |
Price Change | % Change | Share Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
---|---|---|---|---|---|---|---|---|
0.29 | 0.81% | 35.89 | 35.96 | 35.62 | 35.72 | 187,102 | 15:41:44 |
☒
|
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
☐
|
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
Delaware
|
|
41-0319970
|
(State or other jurisdiction of incorporation or organization)
|
|
(I.R.S. Employer Identification No.)
|
Title of each class
|
|
Trading Symbol
|
|
Name of each exchange on which registered
|
||
Common Stock
|
$0.01465
|
par value
|
|
HRL
|
|
New York Stock Exchange
|
Large accelerated filer
|
☒
|
Accelerated filer
|
☐
|
Non-accelerated filer
|
☐
|
Smaller reporting company
|
☐
|
|
|
Emerging growth company
|
☐
|
Class
|
|
Outstanding at August 30, 2020
|
|
|||
Common Stock
|
|
$.01465
|
par value
|
539,607,988
|
|
|
Common Stock Non-Voting
|
|
$.01
|
par value
|
0
|
|
|
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
|
|
|
|
|
|
|
|
|
|
|
|
||
|
||
|
||
|
||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||
|
|
|
|
||||
|
July 26,
2020 |
|
October 27,
2019 |
||||
|
Unaudited
|
|
|
|
|||
Assets
|
|
|
|
|
|
||
Current Assets
|
|
|
|
|
|
||
Cash and Cash Equivalents
|
$
|
1,729,368
|
|
|
$
|
672,901
|
|
Short-term Marketable Securities
|
17,564
|
|
|
14,736
|
|
||
Accounts Receivable
|
648,991
|
|
|
574,396
|
|
||
Inventories
|
982,355
|
|
|
1,042,362
|
|
||
Income Taxes Receivable
|
572
|
|
|
19,924
|
|
||
Prepaid Expenses
|
16,968
|
|
|
22,637
|
|
||
Other Current Assets
|
13,956
|
|
|
14,457
|
|
||
Total Current Assets
|
3,409,774
|
|
|
2,361,413
|
|
||
|
|
|
|
||||
Goodwill
|
2,615,690
|
|
|
2,481,645
|
|
||
|
|
|
|
||||
Other Intangibles
|
1,080,546
|
|
|
1,033,862
|
|
||
|
|
|
|
||||
Pension Assets
|
153,865
|
|
|
135,915
|
|
||
|
|
|
|
||||
Investments In and Receivables From Affiliates
|
298,638
|
|
|
289,157
|
|
||
|
|
|
|
||||
Other Assets
|
241,947
|
|
|
177,901
|
|
||
|
|
|
|
||||
Property, Plant and Equipment
|
|
|
|
||||
Land
|
54,971
|
|
|
49,758
|
|
||
Buildings
|
1,152,620
|
|
|
1,083,902
|
|
||
Equipment
|
2,045,238
|
|
|
1,965,478
|
|
||
Construction in Progress
|
384,052
|
|
|
256,190
|
|
||
Less: Allowance for Depreciation
|
(1,836,869
|
)
|
|
(1,726,217
|
)
|
||
Net Property, Plant and Equipment
|
1,800,012
|
|
|
1,629,111
|
|
||
|
|
|
|
||||
Total Assets
|
$
|
9,600,472
|
|
|
$
|
8,109,004
|
|
|
|
|
|
||||
|
July 26,
2020 |
|
October 27,
2019 |
||||
|
Unaudited
|
|
|
||||
Liabilities and Shareholders' Investment
|
|
|
|
|
|
||
Current Liabilities
|
|
|
|
|
|
||
Accounts Payable
|
$
|
537,535
|
|
|
$
|
590,033
|
|
Accrued Expenses
|
61,079
|
|
|
62,031
|
|
||
Accrued Workers Compensation
|
28,305
|
|
|
24,272
|
|
||
Accrued Marketing Expenses
|
147,071
|
|
|
96,305
|
|
||
Employee Related Expenses
|
214,394
|
|
|
213,515
|
|
||
Taxes Payable
|
49,731
|
|
|
6,208
|
|
||
Interest and Dividends Payable
|
130,248
|
|
|
112,685
|
|
||
Current Maturities of Long-term Debt
|
258,688
|
|
|
—
|
|
||
Total Current Liabilities
|
1,427,051
|
|
|
1,105,049
|
|
||
|
|
|
|
||||
Long-term Debt - Less Current Maturities
|
1,046,821
|
|
|
250,000
|
|
||
|
|
|
|
||||
Pension and Post-retirement Benefits
|
545,988
|
|
|
536,490
|
|
||
|
|
|
|
||||
Other Long-term Liabilities
|
138,543
|
|
|
115,356
|
|
||
|
|
|
|
||||
Deferred Income Taxes
|
170,322
|
|
|
176,574
|
|
||
|
|
|
|
||||
Shareholders' Investment
|
|
|
|
||||
Preferred Stock, Par Value $.01 a Share–
|
|
|
|
||||
Authorized 160,000,000 Shares; Issued–None
|
|
|
|
||||
Common Stock, Non-voting, Par Value $.01 a Share–
|
|
|
|
||||
Authorized 400,000,000 Shares; Issued–None
|
|
|
|
|
|
||
Common Stock, Par Value $.01465 a Share–
|
7,902
|
|
|
7,830
|
|
||
Authorized 1,600,000,000 Shares;
|
|
|
|
||||
Shares Issued as of July 26, 2020: 539,387,013
|
|
|
|
||||
Shares Issued as of October 27, 2019: 534,488,746
|
|
|
|
||||
Additional Paid-in Capital
|
276,592
|
|
|
184,921
|
|
||
Accumulated Other Comprehensive Loss
|
(431,882
|
)
|
|
(399,500
|
)
|
||
Retained Earnings
|
6,414,813
|
|
|
6,128,207
|
|
||
Hormel Foods Corporation Shareholders' Investment
|
6,267,425
|
|
|
5,921,458
|
|
||
Noncontrolling Interest
|
4,322
|
|
|
4,077
|
|
||
Total Shareholders' Investment
|
6,271,747
|
|
|
5,925,535
|
|
||
|
|
|
|
||||
Total Liabilities and Shareholders' Investment
|
$
|
9,600,472
|
|
|
$
|
8,109,004
|
|
|
Thirteen Weeks Ended
|
|
Thirty-Nine Weeks Ended
|
||||||||||||
|
July 26,
2020 |
|
July 28,
2019 |
|
July 26,
2020 |
|
July 28,
2019 |
||||||||
Net Sales
|
$
|
2,381,457
|
|
|
$
|
2,290,705
|
|
|
$
|
7,188,357
|
|
|
$
|
6,995,804
|
|
Cost of Products Sold
|
1,959,032
|
|
|
1,857,263
|
|
|
5,820,158
|
|
|
5,604,879
|
|
||||
Gross Profit
|
422,426
|
|
|
433,442
|
|
|
1,368,198
|
|
|
1,390,925
|
|
||||
|
|
|
|
|
|
|
|
||||||||
Selling, General and Administrative
|
181,085
|
|
|
180,169
|
|
|
570,518
|
|
|
543,789
|
|
||||
Equity in Earnings of Affiliates
|
8,235
|
|
|
3,384
|
|
|
25,843
|
|
|
28,133
|
|
||||
|
|
|
|
|
|
|
|
||||||||
Operating Income
|
249,576
|
|
|
256,657
|
|
|
823,523
|
|
|
875,269
|
|
||||
|
|
|
|
|
|
|
|
||||||||
Other Income and Expense:
|
|
|
|
|
|
|
|
||||||||
Interest and Investment Income (Expense)
|
15,513
|
|
|
7,556
|
|
|
25,289
|
|
|
25,727
|
|
||||
Interest Expense
|
(5,724
|
)
|
|
(3,213
|
)
|
|
(12,798
|
)
|
|
(14,975
|
)
|
||||
|
|
|
|
|
|
|
|
||||||||
Earnings Before Income Taxes
|
259,364
|
|
|
261,000
|
|
|
836,014
|
|
|
886,021
|
|
||||
|
|
|
|
|
|
|
|
||||||||
Provision for Income Taxes
|
56,103
|
|
|
61,573
|
|
|
162,186
|
|
|
162,439
|
|
||||
|
|
|
|
|
|
|
|
||||||||
Net Earnings
|
203,260
|
|
|
199,427
|
|
|
673,828
|
|
|
723,582
|
|
||||
Less: Net Earnings (Loss) Attributable to Noncontrolling Interest
|
141
|
|
|
(22
|
)
|
|
103
|
|
|
279
|
|
||||
Net Earnings Attributable to Hormel Foods Corporation
|
$
|
203,119
|
|
|
$
|
199,449
|
|
|
$
|
673,726
|
|
|
$
|
723,303
|
|
|
|
|
|
|
|
|
|
||||||||
Net Earnings Per Share
|
|
|
|
|
|
|
|
||||||||
Basic
|
$
|
0.38
|
|
|
$
|
0.37
|
|
|
$
|
1.25
|
|
|
$
|
1.35
|
|
Diluted
|
$
|
0.37
|
|
|
$
|
0.37
|
|
|
$
|
1.23
|
|
|
$
|
1.33
|
|
|
|
|
|
|
|
|
|
||||||||
Weighted-average Shares Outstanding
|
|
|
|
|
|
|
|
||||||||
Basic
|
539,108
|
|
|
534,188
|
|
|
537,434
|
|
|
534,721
|
|
||||
Diluted
|
547,149
|
|
|
543,678
|
|
|
546,112
|
|
|
545,709
|
|
|
|
|
|
|
|
|
|
||||||||
|
Thirteen Weeks Ended
|
|
Thirty-Nine Weeks Ended
|
||||||||||||
|
July 26,
2020 |
|
July 28,
2019 |
|
July 26,
2020 |
|
July 28,
2019 |
||||||||
Net Earnings
|
$
|
203,260
|
|
|
$
|
199,427
|
|
|
$
|
673,828
|
|
|
$
|
723,582
|
|
Other Comprehensive Income (Loss), Net of Tax:
|
|
|
|
|
|
|
|
||||||||
Foreign Currency Translation
|
(836
|
)
|
|
(1,051
|
)
|
|
(19,105
|
)
|
|
6,696
|
|
||||
Pension and Other Benefits
|
3,526
|
|
|
1,768
|
|
|
10,619
|
|
|
6,977
|
|
||||
Deferred Hedging
|
13,376
|
|
|
2,061
|
|
|
(23,830
|
)
|
|
8,407
|
|
||||
Total Other Comprehensive Income (Loss)
|
16,066
|
|
|
2,778
|
|
|
(32,316
|
)
|
|
22,080
|
|
||||
Comprehensive Income
|
219,326
|
|
|
202,205
|
|
|
641,513
|
|
|
745,662
|
|
||||
Less: Comprehensive Income (Loss) Attributable to Noncontrolling Interest
|
181
|
|
|
(184
|
)
|
|
169
|
|
|
257
|
|
||||
Comprehensive Income Attributable to Hormel Foods Corporation
|
$
|
219,145
|
|
|
$
|
202,389
|
|
|
$
|
641,344
|
|
|
$
|
745,405
|
|
|
Thirteen Weeks Ended July 28, 2019
|
||||||||||||||||||||||||||||||||
|
Common
Stock
|
|
Treasury
Stock
|
|
Additional
Paid-in
Capital
|
|
Retained
Earnings
|
|
Accumulated
Other
Comprehensive
(Loss) Income
|
|
Non-
controlling
Interest
|
|
Total
Shareholders’
Investment
|
||||||||||||||||||||
|
Shares
|
|
Amount
|
|
Shares
|
|
Amount
|
|
|
|
|
|
|||||||||||||||||||||
Balance at April 28, 2019
|
536,093
|
|
|
$
|
7,854
|
|
|
—
|
|
|
$
|
—
|
|
|
$
|
163,980
|
|
|
$
|
6,003,637
|
|
|
$
|
(278,135
|
)
|
|
$
|
4,448
|
|
|
$
|
5,901,784
|
|
Net Earnings
|
|
|
|
|
|
|
|
|
|
|
199,449
|
|
|
|
|
(22
|
)
|
|
199,427
|
|
|||||||||||||
Other Comprehensive Income (Loss)
|
|
|
|
|
|
|
|
|
|
|
|
|
2,940
|
|
|
(162
|
)
|
|
2,778
|
|
|||||||||||||
Purchases of Common Stock
|
|
|
|
|
(2,682
|
)
|
|
(106,624
|
)
|
|
|
|
|
|
|
|
|
|
(106,624
|
)
|
|||||||||||||
Stock-based Compensation Expense
|
|
|
|
|
|
|
|
|
|
3,193
|
|
|
|
|
|
|
|
|
3,193
|
|
|||||||||||||
Exercise of Stock Options/Restricted Shares
|
269
|
|
|
3
|
|
|
|
|
|
|
3,825
|
|
|
|
|
|
|
|
|
3,828
|
|
||||||||||||
Shares Retired
|
(2,682
|
)
|
|
(39
|
)
|
|
2,682
|
|
|
106,624
|
|
|
(855
|
)
|
|
(105,730
|
)
|
|
|
|
|
|
—
|
|
|||||||||
Declared Cash Dividends – $0.21 per Share
|
|
|
|
|
|
|
|
|
|
|
|
(113,051
|
)
|
|
|
|
|
|
(113,051
|
)
|
|||||||||||||
Balance at July 28, 2019
|
533,680
|
|
|
$
|
7,818
|
|
|
—
|
|
|
$
|
—
|
|
|
$
|
170,143
|
|
|
$
|
5,984,305
|
|
|
$
|
(275,195
|
)
|
|
$
|
4,264
|
|
|
$
|
5,891,335
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
|
Thirteen Weeks Ended July 26, 2020
|
||||||||||||||||||||||||||||||||
|
Common
Stock |
|
Treasury
Stock |
|
Additional
Paid-in Capital |
|
Retained
Earnings |
|
Accumulated
Other Comprehensive (Loss) Income |
|
Non-
controlling Interest |
|
Total
Shareholders’ Investment |
||||||||||||||||||||
|
Shares
|
|
Amount
|
|
Shares
|
|
Amount
|
|
|
|
|
|
|||||||||||||||||||||
Balance at April 26, 2020
|
538,949
|
|
|
$
|
7,896
|
|
|
—
|
|
|
$
|
—
|
|
|
$
|
265,128
|
|
|
$
|
6,336,946
|
|
|
$
|
(447,908
|
)
|
|
$
|
4,140
|
|
|
$
|
6,166,202
|
|
Net Earnings
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
203,119
|
|
|
—
|
|
|
141
|
|
|
203,260
|
|
|||||||
Other Comprehensive Income (Loss)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
16,026
|
|
|
40
|
|
|
16,066
|
|
|||||||
Purchases of Common Stock
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
—
|
|
|||||||
Stock-based Compensation Expense
|
|
|
|
|
|
|
|
|
|
|
|
|
3,724
|
|
|
|
|
|
|
|
|
|
|
|
3,724
|
|
|||||||
Exercise of Stock Options/Restricted Shares
|
438
|
|
|
6
|
|
|
|
|
|
|
|
|
7,740
|
|
|
|
|
|
|
|
|
|
|
|
7,746
|
|
|||||||
Shares Retired
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
—
|
|
|||||||
Declared Cash Dividends – $0.2325 per Share
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(125,253
|
)
|
|
|
|
|
|
|
|
(125,253
|
)
|
|||||||
Balance at July 26, 2020
|
539,387
|
|
|
$
|
7,902
|
|
|
—
|
|
|
$
|
—
|
|
|
$
|
276,592
|
|
|
$
|
6,414,813
|
|
|
$
|
(431,882
|
)
|
|
$
|
4,322
|
|
|
$
|
6,271,747
|
|
|
Thirty-Nine Weeks Ended July 28, 2019
|
||||||||||||||||||||||||||||||||
|
Common
Stock
|
|
Treasury
Stock
|
|
Additional
Paid-in
Capital
|
|
Retained
Earnings
|
|
Accumulated
Other
Comprehensive
(Loss) Income
|
|
Non-
controlling
Interest
|
|
Total
Shareholders’
Investment
|
||||||||||||||||||||
|
Shares
|
|
Amount
|
|
Shares
|
|
Amount
|
|
|
|
|
|
|||||||||||||||||||||
Balance at October 28, 2018
|
534,135
|
|
|
$
|
7,825
|
|
|
—
|
|
|
$
|
—
|
|
|
$
|
106,528
|
|
|
$
|
5,729,956
|
|
|
$
|
(243,498
|
)
|
|
$
|
4,007
|
|
|
$
|
5,604,818
|
|
Net Earnings
|
|
|
|
|
|
|
|
|
|
|
723,303
|
|
|
|
|
279
|
|
|
723,582
|
|
|||||||||||||
Other Comprehensive Income (Loss)
|
|
|
|
|
|
|
|
|
|
|
|
|
22,102
|
|
|
(22
|
)
|
|
22,080
|
|
|||||||||||||
Purchases of Common Stock
|
|
|
|
|
(4,309
|
)
|
|
(174,246
|
)
|
|
|
|
|
|
|
|
|
|
(174,246
|
)
|
|||||||||||||
Stock-based Compensation Expense
|
|
|
1
|
|
|
|
|
|
|
16,706
|
|
|
|
|
|
|
|
|
16,707
|
|
|||||||||||||
Exercise of Stock Options/Restricted Shares
|
3,854
|
|
|
55
|
|
|
|
|
|
|
48,196
|
|
|
|
|
|
|
|
|
48,251
|
|
||||||||||||
Shares Retired
|
(4,309
|
)
|
|
(63
|
)
|
|
4,309
|
|
|
174,246
|
|
|
(1,287
|
)
|
|
(172,896
|
)
|
|
|
|
|
|
—
|
|
|||||||||
Cumulative Effect Adjustment from the Adoption of:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
ASU 2016-16
|
|
|
|
|
|
|
|
|
|
|
(10,475
|
)
|
|
|
|
|
|
(10,475
|
)
|
||||||||||||||
ASU 2017-12
|
|
|
|
|
|
|
|
|
|
|
21
|
|
|
(21
|
)
|
|
|
|
—
|
|
|||||||||||||
ASU 2018-02
|
|
|
|
|
|
|
|
|
|
|
52,342
|
|
|
(53,778
|
)
|
|
|
|
(1,436
|
)
|
|||||||||||||
Declared Cash Dividends – $0.63 per Share
|
|
|
|
|
|
|
|
|
|
|
(337,946
|
)
|
|
|
|
|
|
(337,946
|
)
|
||||||||||||||
Balance at July 28, 2019
|
533,680
|
|
|
$
|
7,818
|
|
|
—
|
|
|
$
|
—
|
|
|
$
|
170,143
|
|
|
$
|
5,984,305
|
|
|
$
|
(275,195
|
)
|
|
$
|
4,264
|
|
|
$
|
5,891,335
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
|
Thirty-Nine Weeks Ended July 26, 2020
|
||||||||||||||||||||||||||||||||
|
Common
Stock |
|
Treasury
Stock |
|
Additional
Paid-in Capital |
|
Retained
Earnings |
|
Accumulated
Other Comprehensive (Loss) Income |
|
Non-
controlling Interest |
|
Total
Shareholders’ Investment |
||||||||||||||||||||
|
Shares
|
|
Amount
|
|
Shares
|
|
Amount
|
|
|
|
|
|
|||||||||||||||||||||
Balance at October 27, 2019
|
534,489
|
|
|
$
|
7,830
|
|
|
—
|
|
|
$
|
—
|
|
|
$
|
184,921
|
|
|
$
|
6,128,207
|
|
|
$
|
(399,500
|
)
|
|
$
|
4,077
|
|
|
$
|
5,925,535
|
|
Net Earnings
|
|
|
|
|
|
|
|
|
|
|
673,726
|
|
|
|
|
103
|
|
|
673,828
|
|
|||||||||||||
Other Comprehensive Income (Loss)
|
|
|
|
|
|
|
|
|
|
|
|
|
(32,382
|
)
|
|
66
|
|
|
(32,316
|
)
|
|||||||||||||
Contribution from Noncontrolling Interest
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
76
|
|
|
76
|
|
||||||||||||||
Purchases of Common Stock
|
|
|
|
|
(302
|
)
|
|
(12,360
|
)
|
|
|
|
|
|
|
|
|
|
(12,360
|
)
|
|||||||||||||
Stock-based Compensation Expense
|
|
|
1
|
|
|
|
|
|
|
19,188
|
|
|
|
|
|
|
|
|
19,189
|
|
|||||||||||||
Exercise of Stock Options/Restricted Shares
|
5,200
|
|
|
75
|
|
|
|
|
|
|
72,632
|
|
|
|
|
|
|
|
|
72,707
|
|
||||||||||||
Shares Retired
|
(302
|
)
|
|
(4
|
)
|
|
302
|
|
|
12,360
|
|
|
(149
|
)
|
|
(12,207
|
)
|
|
|
|
|
|
—
|
|
|||||||||
Declared Cash Dividends – $0.6975 per Share
|
|
|
|
|
|
|
|
|
|
|
(374,913
|
)
|
|
|
|
|
|
(374,913
|
)
|
||||||||||||||
Balance at July 26, 2020
|
539,387
|
|
|
$
|
7,902
|
|
|
—
|
|
|
$
|
—
|
|
|
$
|
276,592
|
|
|
$
|
6,414,813
|
|
|
$
|
(431,882
|
)
|
|
$
|
4,322
|
|
|
$
|
6,271,747
|
|
|
Thirty-Nine Weeks Ended
|
||||||
|
July 26,
2020 |
|
July 28,
2019 |
||||
Operating Activities
|
|
|
|
|
|
||
Net Earnings
|
$
|
673,828
|
|
|
$
|
723,582
|
|
Adjustments to Reconcile to Net Cash Provided by Operating Activities:
|
|
|
|
||||
Depreciation
|
122,694
|
|
|
113,278
|
|
||
Amortization
|
27,080
|
|
|
8,937
|
|
||
Equity in Earnings of Affiliates
|
(25,843
|
)
|
|
(28,133
|
)
|
||
Distribution from Equity Method Investees
|
27,499
|
|
|
20,000
|
|
||
Provision for Deferred Income Taxes
|
(1,890
|
)
|
|
(37,921
|
)
|
||
Loss (Gain) on Property/Equipment Sales and Plant Facilities
|
631
|
|
|
(1,046
|
)
|
||
Gain on Sale of Business
|
—
|
|
|
(16,469
|
)
|
||
Non-cash Investment Activities
|
(10,965
|
)
|
|
(19,778
|
)
|
||
Stock-based Compensation Expense
|
19,189
|
|
|
16,707
|
|
||
Changes in Operating Assets and Liabilities, Net of Acquisitions:
|
|
|
|
||||
Decrease (Increase) in Accounts Receivable
|
(66,053
|
)
|
|
41,309
|
|
||
Decrease (Increase) in Inventories
|
87,030
|
|
|
(190,064
|
)
|
||
Decrease (Increase) in Prepaid Expenses and Other Current Assets
|
(25,279
|
)
|
|
(589
|
)
|
||
Increase (Decrease) in Pension and Post-retirement Benefits
|
5,003
|
|
|
8,473
|
|
||
Increase (Decrease) in Accounts Payable and Accrued Expenses
|
(10,562
|
)
|
|
(94,348
|
)
|
||
Increase (Decrease) in Net Income Taxes Payable
|
55,723
|
|
|
28,974
|
|
||
Net Cash Provided by (Used in) Operating Activities
|
878,086
|
|
|
572,912
|
|
||
|
|
|
|
||||
Investing Activities
|
|
|
|
||||
Net (Purchase) Sale of Securities
|
(2,642
|
)
|
|
(13,884
|
)
|
||
Proceeds from Sale of Business
|
—
|
|
|
473,885
|
|
||
Acquisitions of Businesses/Intangibles
|
(270,789
|
)
|
|
—
|
|
||
Purchases of Property/Equipment
|
(226,830
|
)
|
|
(154,231
|
)
|
||
Proceeds from Sales of Property/Equipment
|
1,466
|
|
|
36,258
|
|
||
Decrease (Increase) in Investments, Equity in Affiliates, and Other Assets
|
(8,424
|
)
|
|
(3,542
|
)
|
||
Proceeds from Company-owned Life Insurance
|
1,180
|
|
|
16,455
|
|
||
Net Cash (Used in) Provided by Investing Activities
|
(506,040
|
)
|
|
354,941
|
|
||
|
|
|
|
||||
Financing Activities
|
|
|
|
||||
Proceeds from Long-term Debt
|
992,381
|
|
|
—
|
|
||
Repayments of Long-term Debt and Finance Leases
|
(6,221
|
)
|
|
(374,840
|
)
|
||
Dividends Paid on Common Stock
|
(362,003
|
)
|
|
(324,971
|
)
|
||
Share Repurchase
|
(12,360
|
)
|
|
(174,246
|
)
|
||
Proceeds from Exercise of Stock Options
|
72,118
|
|
|
48,107
|
|
||
Proceeds from Noncontrolling Interest
|
77
|
|
|
—
|
|
||
Net Cash Provided by (Used in) Financing Activities
|
683,992
|
|
|
(825,950
|
)
|
||
|
|
|
|
||||
Effect of Exchange Rate Changes on Cash
|
428
|
|
|
(840
|
)
|
||
Increase (Decrease) in Cash and Cash Equivalents
|
1,056,466
|
|
|
101,063
|
|
||
Cash and Cash Equivalents at Beginning of Year
|
672,901
|
|
|
459,136
|
|
||
Cash and Cash Equivalents at End of Quarter
|
$
|
1,729,368
|
|
|
$
|
560,199
|
|
(in thousands)
|
July 26,
2020 |
|
October 27,
2019 |
||||
Finished Products
|
$
|
506,814
|
|
|
$
|
604,035
|
|
Raw Materials and Work-in-Process
|
274,485
|
|
|
255,474
|
|
||
Operating Supplies
|
129,952
|
|
|
116,981
|
|
||
Maintenance Materials and Parts
|
71,104
|
|
|
65,872
|
|
||
Total
|
$
|
982,355
|
|
|
$
|
1,042,362
|
|
(in thousands)
|
Grocery
Products |
|
Refrigerated
Foods |
|
Jennie-O
Turkey Store
|
|
International
& Other |
|
Total
|
||||||||||
Balance at April 26, 2020
|
$
|
632,301
|
|
|
$
|
1,671,563
|
|
|
$
|
176,628
|
|
|
$
|
202,347
|
|
|
$
|
2,682,839
|
|
Purchase Adjustments
|
—
|
|
|
(64,558
|
)
|
|
—
|
|
|
—
|
|
|
(64,558
|
)
|
|||||
Foreign Currency Translation
|
—
|
|
|
—
|
|
|
—
|
|
|
(2,592
|
)
|
|
(2,592
|
)
|
|||||
Balance at July 26, 2020
|
$
|
632,301
|
|
|
$
|
1,607,005
|
|
|
$
|
176,628
|
|
|
$
|
199,756
|
|
|
$
|
2,615,690
|
|
(in thousands)
|
Grocery
Products |
|
Refrigerated
Foods |
|
Jennie-O
Turkey Store |
|
International
& Other |
|
Total
|
||||||||||
Balance at October 27, 2019
|
$
|
632,301
|
|
|
$
|
1,458,692
|
|
|
$
|
176,628
|
|
|
$
|
214,024
|
|
|
$
|
2,481,645
|
|
Goodwill Acquired
|
—
|
|
|
148,313
|
|
|
—
|
|
|
—
|
|
|
148,313
|
|
|||||
Foreign Currency Translation
|
—
|
|
|
—
|
|
|
—
|
|
|
(14,269
|
)
|
|
(14,269
|
)
|
|||||
Balance at July 26, 2020
|
$
|
632,301
|
|
|
$
|
1,607,005
|
|
|
$
|
176,628
|
|
|
$
|
199,756
|
|
|
$
|
2,615,690
|
|
(in thousands)
|
July 26,
2020 |
|
October 27,
2019 |
||||
Brands/Tradenames/Trademarks
|
$
|
953,190
|
|
|
$
|
959,400
|
|
Other Intangibles
|
184
|
|
|
184
|
|
||
Foreign Currency Translation
|
(6,686
|
)
|
|
(3,803
|
)
|
||
Total
|
$
|
946,688
|
|
|
$
|
955,781
|
|
|
July 26, 2020
|
|
October 27, 2019
|
||||||||||||
(in thousands)
|
Gross Carrying
Amount
|
|
Accumulated
Amortization
|
|
Gross Carrying
Amount
|
|
Accumulated
Amortization
|
||||||||
Customer Lists/Relationships
|
$
|
117,239
|
|
|
$
|
(43,692
|
)
|
|
$
|
113,739
|
|
|
$
|
(36,744
|
)
|
Tradenames/Trademarks
|
10,536
|
|
|
(2,982
|
)
|
|
4,326
|
|
|
(1,589
|
)
|
||||
Other Intangibles
|
60,631
|
|
|
(3,185
|
)
|
|
2,631
|
|
|
(1,228
|
)
|
||||
Foreign Currency Translation
|
—
|
|
|
(4,689
|
)
|
|
—
|
|
|
(3,054
|
)
|
||||
Total
|
$
|
188,406
|
|
|
$
|
(54,548
|
)
|
|
$
|
120,696
|
|
|
$
|
(42,615
|
)
|
(in thousands)
|
|
July 26,
2020 |
|
October 27,
2019 |
||||
Senior Unsecured Notes, with Interest at 1.800%, Interest Due
Semi-annually through June 2030 Maturity Date |
|
$
|
1,000,000
|
|
|
$
|
—
|
|
Senior Unsecured Notes, with Interest at 4.125%, Interest Due
Semi-annually through April 2021 Maturity Date |
|
250,000
|
|
|
250,000
|
|
||
Unamortized Discount on Senior Notes
|
|
(2,698
|
)
|
|
—
|
|
||
Unamortized Debt Issuance Costs
|
|
(8,186
|
)
|
|
—
|
|
||
Finance Lease Liabilities(1)
|
|
63,091
|
|
|
—
|
|
||
Other Financing Arrangements
|
|
3,300
|
|
|
—
|
|
||
Total
|
|
1,305,508
|
|
|
250,000
|
|
||
Less: Current Maturities of Long-term Debt
|
|
258,688
|
|
|
—
|
|
||
Long-term Debt - Less Current Maturities
|
|
$
|
1,046,821
|
|
|
$
|
250,000
|
|
|
Pension Benefits
|
||||||||||||||
|
Thirteen Weeks Ended
|
|
Thirty-Nine Weeks Ended
|
||||||||||||
(in thousands)
|
July 26,
2020 |
|
July 28,
2019 |
|
July 26,
2020 |
|
July 28,
2019 |
||||||||
Service Cost
|
$
|
8,896
|
|
|
$
|
6,510
|
|
|
$
|
26,688
|
|
|
$
|
19,531
|
|
Interest Cost
|
13,411
|
|
|
15,097
|
|
|
40,232
|
|
|
45,289
|
|
||||
Expected Return on Plan Assets
|
(25,321
|
)
|
|
(23,123
|
)
|
|
(75,963
|
)
|
|
(69,369
|
)
|
||||
Amortization of Prior Service Cost
|
(542
|
)
|
|
(699
|
)
|
|
(1,626
|
)
|
|
(2,096
|
)
|
||||
Recognized Actuarial Loss
|
5,595
|
|
|
3,702
|
|
|
16,787
|
|
|
11,104
|
|
||||
Curtailment Loss (Gain)
|
—
|
|
|
—
|
|
|
—
|
|
|
2,825
|
|
||||
Net Periodic Cost
|
$
|
2,039
|
|
|
$
|
1,487
|
|
|
$
|
6,118
|
|
|
$
|
7,284
|
|
|
Post-retirement Benefits
|
||||||||||||||
|
Thirteen Weeks Ended
|
|
Thirty-Nine Weeks Ended
|
||||||||||||
(in thousands)
|
July 26,
2020 |
|
July 28,
2019 |
|
July 26,
2020 |
|
July 28,
2019 |
||||||||
Service Cost
|
$
|
192
|
|
|
$
|
173
|
|
|
$
|
579
|
|
|
$
|
520
|
|
Interest Cost
|
2,322
|
|
|
3,007
|
|
|
7,111
|
|
|
9,181
|
|
||||
Amortization of Prior Service Cost
|
(662
|
)
|
|
(669
|
)
|
|
(1,988
|
)
|
|
(2,007
|
)
|
||||
Recognized Actuarial Loss
|
261
|
|
|
—
|
|
|
784
|
|
|
—
|
|
||||
Curtailment Loss (Gain)
|
—
|
|
|
—
|
|
|
—
|
|
|
(620
|
)
|
||||
Net Periodic Cost
|
$
|
2,113
|
|
|
$
|
2,511
|
|
|
$
|
6,486
|
|
|
$
|
7,074
|
|
|
|
Volume
|
||
Commodity Contracts
|
|
July 26, 2020
|
|
October 27, 2019
|
Corn
|
|
19.1 million bushels
|
|
30.4 million bushels
|
Lean Hogs
|
|
162.6 million pounds
|
|
187.3 million pounds
|
|
|
|
|
Fair Value (1)
|
||||||
(in thousands)
|
|
Location on Consolidated Statements
of Financial Position
|
|
July 26,
2020 |
|
October 27,
2019 |
||||
Derivatives Designated as Hedges:
|
|
|
|
|
|
|
||||
Commodity Contracts
|
|
Other Current Assets
|
|
$
|
(19,016
|
)
|
|
$
|
6,405
|
|
Location on Consolidated Statements
of Financial Position
|
|
Carrying Amount of the Hedged
Assets/(Liabilities)
|
||||||
(in thousands)
|
|
July 26,
2020 |
|
October 27, 2019
|
||||
Accounts Payable
|
|
$
|
(1,847
|
)
|
|
$
|
(2,805
|
)
|
|
|
Gain/(Loss)
Recognized
in AOCL (1)
|
|
Location on
Consolidated
Statements
of Operations
|
|
Gain/(Loss)
Reclassified from
AOCL into Earnings (1)
|
||||||||||||
|
|
Thirteen Weeks Ended
|
|
|
Thirteen Weeks Ended
|
|||||||||||||
(in thousands)
|
|
July 26, 2020
|
|
July 28, 2019
|
|
|
July 26, 2020
|
|
July 28, 2019
|
|||||||||
Cash Flow Hedges:
|
|
|
|
|
|
|
|
|
|
|
||||||||
Commodity Contracts
|
|
$
|
(943
|
)
|
|
$
|
9,883
|
|
|
Cost of Products Sold
|
|
$
|
(18,645
|
)
|
|
$
|
940
|
|
Excluded Component (2)
|
|
—
|
|
|
(4,742
|
)
|
|
|
|
|
|
|
|
|
Gain/(Loss)
Recognized
in AOCL (1)
|
|
Location on
Consolidated
Statements
of Operations
|
|
Gain/(Loss)
Reclassified from
AOCL into Earnings (1)
|
||||||||||||
|
|
Thirty-Nine Weeks Ended
|
|
|
Thirty-Nine Weeks Ended
|
|||||||||||||
(in thousands)
|
|
July 26, 2020
|
|
July 28, 2019
|
|
|
July 26, 2020
|
|
July 28, 2019
|
|||||||||
Cash Flow Hedges:
|
|
|
|
|
|
|
|
|
|
|
||||||||
Commodity Contracts
|
|
$
|
(57,514
|
)
|
|
$
|
9,546
|
|
|
Cost of Products Sold
|
|
$
|
(25,997
|
)
|
|
$
|
(835
|
)
|
Excluded Component (2)
|
|
—
|
|
|
501
|
|
|
|
|
|
|
|
(1)
|
See Note I - Accumulated Other Comprehensive Loss for the after-tax impact of these gains or losses on Net Earnings.
|
(2)
|
Represents the time value amount of lean hog options excluded from the assessment of effectiveness for which the difference between changes in fair value and periodic amortization is recorded in AOCL.
|
|
|
Cost of Products Sold
|
||||||||||||||
|
|
Thirteen Weeks Ended
|
|
Thirty-Nine Weeks Ended
|
||||||||||||
(in thousands)
|
|
July 26, 2020
|
|
July 28, 2019
|
|
July 26, 2020
|
|
July 28, 2019
|
||||||||
Consolidated Statements of Operations
|
|
$
|
1,959,032
|
|
|
$
|
1,857,263
|
|
|
$
|
5,820,158
|
|
|
$
|
5,604,879
|
|
|
|
|
|
|
|
|
|
|
||||||||
Cash Flow Hedges - Commodity Contracts
|
|
|
|
|
|
|
|
|
||||||||
Gain (Loss) Reclassified from AOCL
|
|
(18,645
|
)
|
|
940
|
|
|
(25,997
|
)
|
|
(835
|
)
|
||||
Amortization of Excluded Component from Options
|
|
—
|
|
|
(313
|
)
|
|
—
|
|
|
(2,781
|
)
|
||||
|
|
|
|
|
|
|
|
|
||||||||
Fair Value Hedges - Commodity Contracts
|
|
|
|
|
|
|
|
|
||||||||
Gain (Loss) on Commodity Futures (1)
|
|
4,341
|
|
|
656
|
|
|
13,487
|
|
|
2,293
|
|
||||
Total Gain (Loss) Recognized in Earnings
|
|
$
|
(14,304
|
)
|
|
$
|
1,283
|
|
|
$
|
(12,510
|
)
|
|
$
|
(1,323
|
)
|
(1)
|
Amounts represent gains or losses on commodity contracts designated as fair value hedges that were closed during the thirteen and thirty-nine weeks ended July 26, 2020, and July 28, 2019, which were offset by a corresponding gain or loss on the underlying hedged purchase commitment. Additional gains or losses related to changes in the fair value of open commodity contracts, along with the offsetting gain or loss on the hedged purchase commitment, are also marked-to-market through earnings with no impact on a net basis.
|
(in thousands)
|
Segment
|
|
% Owned
|
|
July 26,
2020 |
|
October 27,
2019 |
||||
MegaMex Foods, LLC
|
Grocery Products
|
|
50%
|
|
$
|
213,397
|
|
|
$
|
218,592
|
|
Other Joint Ventures
|
International & Other
|
|
Various (20-40%)
|
|
85,241
|
|
|
70,565
|
|
||
Total
|
|
|
|
|
$
|
298,638
|
|
|
$
|
289,157
|
|
Thirteen Weeks Ended July 26, 2020
|
|||||||||||||||||
(in thousands)
|
Foreign
Currency Translation |
|
Pension &
Other Benefits |
|
Hedging
Deferred
Gain (Loss)
|
|
Accumulated
Other Comprehensive Loss |
||||||||||
Balance at April 26, 2020
|
$
|
(71,292
|
)
|
|
$
|
(341,783
|
)
|
|
|
$
|
(34,833
|
)
|
|
|
$
|
(447,908
|
)
|
Unrecognized Gains (Losses)
|
|
|
|
|
|
|
|
|
|
||||||||
Gross
|
(875
|
)
|
|
13
|
|
|
|
(943
|
)
|
|
|
(1,805
|
)
|
||||
Tax Effect
|
—
|
|
|
—
|
|
|
|
231
|
|
|
|
231
|
|
||||
Reclassification into Net Earnings
|
|
|
|
|
|
|
|
|
|
||||||||
Gross
|
—
|
|
|
4,652
|
|
(1)
|
|
18,645
|
|
(2)
|
|
23,297
|
|
||||
Tax Effect
|
—
|
|
|
(1,140
|
)
|
|
|
(4,557
|
)
|
|
|
(5,697
|
)
|
||||
Net of Tax Amount
|
(875
|
)
|
|
3,526
|
|
|
|
13,376
|
|
|
|
16,026
|
|
||||
Balance at July 26, 2020
|
$
|
(72,168
|
)
|
|
$
|
(338,257
|
)
|
|
|
$
|
(21,458
|
)
|
|
|
$
|
(431,882
|
)
|
Thirty-Nine Weeks Ended July 26, 2020
|
|||||||||||||||||
(in thousands)
|
Foreign
Currency Translation |
|
Pension &
Other Benefits |
|
Hedging
Deferred
Gain (Loss)
|
|
Accumulated
Other Comprehensive Loss |
||||||||||
Balance at October 27, 2019
|
$
|
(52,996
|
)
|
|
$
|
(348,877
|
)
|
|
|
$
|
2,373
|
|
|
|
$
|
(399,500
|
)
|
Unrecognized Gains (Losses)
|
|
|
|
|
|
|
|
|
|
||||||||
Gross
|
(19,171
|
)
|
|
81
|
|
|
|
(57,514
|
)
|
|
|
(76,604
|
)
|
||||
Tax Effect
|
—
|
|
|
—
|
|
|
|
14,038
|
|
|
|
14,038
|
|
||||
Reclassification into Net Earnings
|
|
|
|
|
|
|
|
|
|
||||||||
Gross
|
—
|
|
|
13,957
|
|
(1)
|
|
25,997
|
|
(2)
|
|
39,954
|
|
||||
Tax Effect
|
—
|
|
|
(3,419
|
)
|
|
|
(6,352
|
)
|
|
|
(9,771
|
)
|
||||
Net of Tax Amount
|
(19,171
|
)
|
|
10,619
|
|
|
|
(23,830
|
)
|
|
|
(32,382
|
)
|
||||
Balance at July 26, 2020
|
$
|
(72,168
|
)
|
|
$
|
(338,257
|
)
|
|
|
$
|
(21,458
|
)
|
|
|
$
|
(431,882
|
)
|
(1)
|
Included in the computation of net periodic cost. See Note F - Pension and Other Post-Retirement Benefits for additional details.
|
(2)
|
Included in Cost of Products Sold in the Consolidated Statements of Operations.
|
|
Shares
|
|
Weighted-
Average
Exercise Price
|
|
Weighted-
Average
Remaining
Contractual
Term (Years)
|
|
Aggregate
Intrinsic Value
|
|||||
Stock Options Outstanding at October 27, 2019
|
25,994
|
|
|
$
|
26.49
|
|
|
|
|
|
||
Granted
|
1,218
|
|
|
45.88
|
|
|
|
|
|
|||
Exercised
|
5,362
|
|
|
15.62
|
|
|
|
|
|
|||
Forfeited
|
185
|
|
|
36.35
|
|
|
|
|
|
|||
Expired
|
1
|
|
|
36.25
|
|
|
|
|
|
|||
Stock Options Outstanding at July 26, 2020
|
21,664
|
|
|
30.18
|
|
|
5.4
|
|
$
|
435,137
|
|
|
Stock Options Exercisable at July 26, 2020
|
14,707
|
|
|
$
|
25.85
|
|
|
4.1
|
|
$
|
359,098
|
|
|
Thirteen Weeks Ended
|
|
Thirty-Nine Weeks Ended
|
||||||||||||
|
July 26,
2020 |
|
July 28,
2019 |
|
July 26,
2020 |
|
July 28,
2019 |
||||||||
Weighted-average Grant Date Fair Value (1)
|
$
|
7.22
|
|
|
$
|
—
|
|
|
$
|
7.71
|
|
|
$
|
9.24
|
|
Intrinsic Value of Exercised Options
|
13,254
|
|
|
7,308
|
|
|
167,148
|
|
|
115,094
|
|
|
Thirteen Weeks Ended
|
|
Thirty-Nine Weeks Ended
|
||||||||
|
July 26,
2020 |
|
July 28,
2019 |
|
July 26,
2020 |
|
July 28,
2019 |
||||
Risk-free Interest Rate
|
0.7
|
%
|
|
—
|
%
|
|
1.7
|
%
|
|
2.8
|
%
|
Dividend Yield
|
1.9
|
%
|
|
—
|
%
|
|
2.0
|
%
|
|
1.9
|
%
|
Stock Price Volatility
|
19.0
|
%
|
|
—
|
%
|
|
19.0
|
%
|
|
19.0
|
%
|
Expected Option Life
|
8 years
|
|
|
—
|
|
|
8 years
|
|
|
8 years
|
|
|
Shares
|
|
Weighted-
Average
Exercise Price
|
|
Weighted-
Average
Remaining
Contractual
Term (Years)
|
|
Aggregate
Intrinsic Value
|
|||||
Restricted Stock Units Outstanding at October 27, 2019
|
—
|
|
|
$
|
—
|
|
|
|
|
|
||
Granted
|
205
|
|
|
45.88
|
|
|
|
|
|
|||
Vested
|
14
|
|
|
45.54
|
|
|
|
|
|
|||
Restricted Stock Units Outstanding at July 26, 2020
|
191
|
|
|
$
|
45.90
|
|
|
2.4
|
|
$
|
9,599
|
|
|
Thirteen Weeks Ended
|
|
Thirty-Nine Weeks Ended
|
||||||||||||
|
July 26,
2020 |
|
July 28,
2019 |
|
July 26,
2020 |
|
July 28,
2019 |
||||||||
Weighted-average Grant Date Fair Value
|
$
|
48.76
|
|
|
$
|
—
|
|
|
$
|
45.88
|
|
|
$
|
—
|
|
Fair Value of Restricted Stock Units Granted
|
63
|
|
|
—
|
|
|
9,383
|
|
|
—
|
|
|
Shares
|
|
Weighted-
Average Grant
Date Fair Value
|
|||
Restricted Shares Outstanding at October 27, 2019
|
51
|
|
|
$
|
42.23
|
|
Granted
|
41
|
|
|
47.29
|
|
|
Vested
|
47
|
|
|
42.08
|
|
|
Restricted Shares Outstanding at July 26, 2020
|
45
|
|
|
$
|
47.03
|
|
|
Thirty-Nine Weeks Ended
|
||||||
|
July 26,
2020 |
|
July 28,
2019 |
||||
Weighted-average Grant Date Fair Value
|
$
|
47.29
|
|
|
$
|
42.23
|
|
Fair Value of Restricted Shares Granted
|
1,973
|
|
|
2,134
|
|
||
Fair Value of Shares Vested
|
1,974
|
|
|
1,760
|
|
|
Fair Value Measurements at July 26, 2020
|
||||||||||||||
(in thousands)
|
Total Fair Value
|
|
Quoted Prices
in Active
Markets for
Identical Assets
(Level 1)
|
|
Significant
Other
Observable
Inputs
(Level 2)
|
|
Significant
Unobservable
Inputs
(Level 3)
|
||||||||
Assets at Fair Value
|
|
|
|
|
|
|
|
|
|
|
|
||||
Cash and Cash Equivalents (1)
|
$
|
1,729,368
|
|
|
$
|
1,728,438
|
|
|
$
|
930
|
|
|
$
|
—
|
|
Short-term Marketable Securities (2)
|
17,564
|
|
|
7,031
|
|
|
10,533
|
|
|
—
|
|
||||
Other Trading Securities (3)
|
168,519
|
|
|
—
|
|
|
168,519
|
|
|
—
|
|
||||
Commodity Derivatives (4)
|
12,747
|
|
|
12,747
|
|
|
—
|
|
|
—
|
|
||||
Total Assets at Fair Value
|
$
|
1,928,198
|
|
|
$
|
1,748,216
|
|
|
$
|
179,982
|
|
|
$
|
—
|
|
Liabilities at Fair Value
|
|
|
|
|
|
|
|
||||||||
Deferred Compensation (3)
|
$
|
60,908
|
|
|
$
|
—
|
|
|
$
|
60,908
|
|
|
$
|
—
|
|
Total Liabilities at Fair Value
|
$
|
60,908
|
|
|
$
|
—
|
|
|
$
|
60,908
|
|
|
$
|
—
|
|
|
Fair Value Measurements at October 27, 2019
|
||||||||||||||
(in thousands)
|
Total Fair
Value
|
|
Quoted Prices
in Active
Markets for
Identical Assets
(Level 1)
|
|
Significant
Other
Observable
Inputs
(Level 2)
|
|
Significant
Unobservable
Inputs
(Level 3)
|
||||||||
Assets at Fair Value
|
|
|
|
|
|
|
|
|
|
|
|
||||
Cash and Cash Equivalents (1)
|
$
|
672,901
|
|
|
$
|
672,458
|
|
|
$
|
443
|
|
|
$
|
—
|
|
Short-term Marketable Securities (2)
|
14,736
|
|
|
5,186
|
|
|
9,550
|
|
|
—
|
|
||||
Other Trading Securities (3)
|
157,526
|
|
|
—
|
|
|
157,526
|
|
|
—
|
|
||||
Commodity Derivatives (4)
|
12,882
|
|
|
12,882
|
|
|
—
|
|
|
—
|
|
||||
Total Assets at Fair Value
|
$
|
858,045
|
|
|
$
|
690,526
|
|
|
$
|
167,519
|
|
|
$
|
—
|
|
Liabilities at Fair Value
|
|
|
|
|
|
|
|
||||||||
Deferred Compensation (3)
|
$
|
62,373
|
|
|
$
|
—
|
|
|
$
|
62,373
|
|
|
$
|
—
|
|
Total Liabilities at Fair Value
|
$
|
62,373
|
|
|
$
|
—
|
|
|
$
|
62,373
|
|
|
$
|
—
|
|
(1)
|
The Company’s cash equivalents considered Level 1 consist primarily of bank deposits, money market funds rated AAA, or other highly liquid investment accounts, and have a maturity date of three months or less. Cash equivalents considered Level 2 are funds holding agency bonds or securities recognized at amortized cost.
|
(2)
|
The Company holds securities as part of a portfolio maintained to generate investment income and to provide cash for operations of the Company, if necessary. The portfolio is managed by a third party who is responsible for daily trading activities, and all assets within the portfolio are highly liquid. The cash, U.S. government securities, and money market funds rated AAA held by the portfolio are classified as Level 1. The current investment portfolio also includes corporate bonds and other asset backed securities for which there is an active, quoted market. Market prices are obtained from a variety of industry providers, large financial institutions, and other third-party sources to calculate a representative daily market value, and therefore, these securities are classified as Level 2.
|
(3)
|
The Company maintains a rabbi trust to fund certain supplemental executive retirement plans and deferred compensation plans. Under the plans, the participants can defer certain types of compensation and elect to receive a return on the deferred amounts based on the changes in fair value of various investment options, primarily a variety of mutual funds. The majority of the funds held in the rabbi trust relate to the supplemental executive retirement plans and have been invested in fixed income funds managed by a third party. The declared rate on these funds is set based on a formula using the yield of the general account investment portfolio supporting the fund, adjusted for expenses and other charges. The rate is guaranteed for one year at issue and may be reset annually on the policy anniversary, subject to a guaranteed minimum rate. As the value is based on adjusted market rates and the fixed rate is only reset on an annual basis, these funds are classified as Level 2. The remaining funds held are also managed by a third-party insurance policy, the values of which represent their cash surrender value based on the fair value of the underlying investments in the account and include equity
|
(4)
|
The Company’s commodity derivatives represent futures contracts and options used in its hedging or other programs to offset price fluctuations associated with purchases of corn and hogs, and to minimize the price risk assumed when forward priced contracts are offered to the Company’s commodity suppliers. The Company’s futures contracts for corn are traded on the Chicago Board of Trade, while futures contracts for lean hogs are traded on the Chicago Mercantile Exchange. These are active markets with quoted prices available, and these contracts are classified as Level 1. All derivatives are reviewed for potential credit risk and risk of nonperformance. The net balance for each program is included in Other Current Assets or Accounts Payable, as appropriate, in the Consolidated Statements of Financial Position. As of July 26, 2020, the Company has recognized the right to reclaim net cash collateral of $31.8 million from various counterparties (including cash of $40.1 million less $8.3 million of realized losses). As of October 27, 2019, the Company had recognized the right to reclaim net cash collateral of $6.5 million from various counterparties (including $10.5 million of realized gains on closed positions offset by cash owed of $4.0 million).
|
(in thousands)
|
Location on Consolidated Statements of Financial Position
|
|
July 26, 2020
|
||
Right-of-Use Assets
|
|
|
|
|
|
Operating
|
Other Assets
|
|
$
|
55,761
|
|
Finance
|
Net Property, Plant and Equipment
|
|
63,049
|
|
|
Total Right-of-Use Assets
|
|
$
|
118,810
|
|
|
Liabilities
|
|
|
|
||
Current
|
|
|
|
||
Operating
|
Accrued Expenses
|
|
$
|
12,760
|
|
Finance
|
Current Maturities of Long-Term Debt
|
|
8,307
|
|
|
Noncurrent
|
|
|
|
||
Operating
|
Other Long-term Liabilities
|
|
45,042
|
|
|
Finance
|
Long-term Debt - Less Current Maturities
|
|
54,784
|
|
|
Total Lease Liabilities
|
|
|
$
|
120,893
|
|
|
|
Thirteen Weeks Ended
|
|
Thirty-Nine Weeks Ended
|
||||
(in thousands)
|
|
July 26, 2020
|
|
July 26, 2020
|
||||
Operating Lease Cost (1)
|
|
$
|
4,625
|
|
|
$
|
15,115
|
|
Finance Lease Cost
|
|
|
|
|
|
|||
Amortization of Right-of-Use Assets
|
|
2,000
|
|
|
6,000
|
|
||
Interest on Lease Liabilities
|
|
566
|
|
|
1,758
|
|
||
Variable Lease Cost (2)
|
|
104,450
|
|
|
313,983
|
|
||
Net Lease Cost
|
|
$
|
111,640
|
|
|
$
|
336,856
|
|
(1)
|
Includes short-term lease costs, which are immaterial.
|
(2)
|
ASC 842 - Leases requires disclosure of payments related to agreements with an embedded lease that are not otherwise reflected on the balance sheet. The Company's variable lease costs primarily include inventory related expenses, such as materials, labor, and overhead from manufacturing and service agreements that contain embedded leases. Variability of these costs is determined based on usage or output and may vary for other reasons such as changes in material prices.
|
|
|
July 26, 2020
|
|
Weighted Average Remaining Lease Term
|
|
|
|
Operating Leases
|
|
7.35 years
|
|
Finance Leases
|
|
8.36 years
|
|
Weighted Average Discount Rate
|
|
|
|
Operating Leases
|
|
2.30
|
%
|
Finance Leases
|
|
3.56
|
%
|
(in thousands)
|
|
July 26, 2020
|
||
Cash Paid for Amounts Included in the Measurement of Lease Liabilities
|
|
|
|
|
Operating Cash Flows from Operating Leases
|
|
$
|
11,113
|
|
Operating Cash Flows from Finance Leases
|
|
1,758
|
|
|
Financing Cash Flows from Finance Leases
|
|
6,129
|
|
|
|
|
|
||
Right-of-Use Assets obtained in exchange for new operating lease liabilities
|
|
4,190
|
|
(in thousands)
|
Operating Leases
|
|
Finance Leases (1)
|
|
Total
|
||||||
2020 (thirteen weeks remaining)
|
$
|
4,655
|
|
|
$
|
2,613
|
|
|
$
|
7,267
|
|
2021
|
12,839
|
|
|
10,322
|
|
|
23,160
|
|
|||
2022
|
10,176
|
|
|
9,934
|
|
|
20,109
|
|
|||
2023
|
8,512
|
|
|
9,738
|
|
|
18,250
|
|
|||
2024
|
5,648
|
|
|
9,612
|
|
|
15,260
|
|
|||
2025
|
3,458
|
|
|
8,117
|
|
|
11,575
|
|
|||
2026 and beyond
|
18,644
|
|
|
21,192
|
|
|
39,836
|
|
|||
Total Lease Payments
|
$
|
63,932
|
|
|
$
|
71,527
|
|
|
$
|
135,459
|
|
Less: Imputed Interest
|
6,130
|
|
|
8,436
|
|
|
14,566
|
|
|||
Present Value of Lease Liabilities
|
$
|
57,802
|
|
|
$
|
63,091
|
|
|
$
|
120,893
|
|
(1)
|
Over the life of the lease contracts, finance lease payments include $8.7 million related to purchase options which are reasonably certain of being exercised.
|
|
Thirteen Weeks Ended
|
|
Thirty-Nine Weeks Ended
|
||||||||
(in thousands)
|
July 26,
2020 |
|
July 28,
2019 |
|
July 26,
2020 |
|
July 28,
2019 |
||||
Basic Weighted-Average Shares Outstanding
|
539,108
|
|
|
534,188
|
|
|
537,434
|
|
|
534,721
|
|
Dilutive Potential Common Shares
|
8,041
|
|
|
9,490
|
|
|
8,678
|
|
|
10,988
|
|
Diluted Weighted-Average Shares Outstanding
|
547,149
|
|
|
543,678
|
|
|
546,112
|
|
|
545,709
|
|
|
|
|
|
|
|
|
|
||||
Antidilutive Potential Common Shares
|
1,626
|
|
|
5,883
|
|
|
2,178
|
|
|
3,033
|
|
|
Thirteen Weeks Ended
|
|
Thirty-Nine Weeks Ended
|
||||||||||||
(in thousands)
|
July 26,
2020 |
|
July 28,
2019 |
|
July 26, 2020
|
|
July 28,
2019 |
||||||||
Sales to Unaffiliated Customers
|
|
|
|
|
|
|
|
|
|
||||||
Grocery Products
|
$
|
580,798
|
|
|
$
|
543,088
|
|
|
$
|
1,804,674
|
|
|
$
|
1,785,232
|
|
Refrigerated Foods
|
1,363,092
|
|
|
1,301,101
|
|
|
3,962,219
|
|
|
3,837,732
|
|
||||
Jennie-O Turkey Store
|
286,805
|
|
|
298,781
|
|
|
959,988
|
|
|
925,271
|
|
||||
International & Other
|
150,762
|
|
|
147,735
|
|
|
461,475
|
|
|
447,569
|
|
||||
Total
|
$
|
2,381,457
|
|
|
$
|
2,290,705
|
|
|
$
|
7,188,357
|
|
|
$
|
6,995,804
|
|
|
|
|
|
|
|
|
|
||||||||
Intersegment Sales
|
|
|
|
|
|
|
|
||||||||
Grocery Products
|
$
|
—
|
|
|
$
|
10
|
|
|
$
|
13
|
|
|
$
|
32
|
|
Refrigerated Foods
|
5,092
|
|
|
5,282
|
|
|
16,143
|
|
|
10,733
|
|
||||
Jennie-O Turkey Store
|
25,361
|
|
|
31,804
|
|
|
82,082
|
|
|
90,665
|
|
||||
International & Other
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
Total
|
30,454
|
|
|
37,096
|
|
|
98,237
|
|
|
101,430
|
|
||||
Intersegment Elimination
|
(30,454
|
)
|
|
(37,096
|
)
|
|
(98,237
|
)
|
|
(101,430
|
)
|
||||
Total
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
|
|
|
|
|
|
|
||||||||
Net Sales
|
|
|
|
|
|
|
|
||||||||
Grocery Products
|
$
|
580,798
|
|
|
$
|
543,098
|
|
|
$
|
1,804,687
|
|
|
$
|
1,785,264
|
|
Refrigerated Foods
|
1,368,185
|
|
|
1,306,383
|
|
|
3,978,362
|
|
|
3,848,465
|
|
||||
Jennie-O Turkey Store
|
312,166
|
|
|
330,585
|
|
|
1,042,070
|
|
|
1,015,936
|
|
||||
International & Other
|
150,762
|
|
|
147,735
|
|
|
461,475
|
|
|
447,569
|
|
||||
Intersegment Elimination
|
(30,454
|
)
|
|
(37,096
|
)
|
|
(98,237
|
)
|
|
(101,430
|
)
|
||||
Total
|
$
|
2,381,457
|
|
|
$
|
2,290,705
|
|
|
$
|
7,188,357
|
|
|
$
|
6,995,804
|
|
|
|
|
|
|
|
|
|
||||||||
Segment Profit
|
|
|
|
|
|
|
|
||||||||
Grocery Products
|
$
|
80,169
|
|
|
$
|
58,778
|
|
|
$
|
276,367
|
|
|
$
|
258,574
|
|
Refrigerated Foods
|
152,822
|
|
|
171,795
|
|
|
451,596
|
|
|
492,476
|
|
||||
Jennie-O Turkey Store
|
7,069
|
|
|
21,278
|
|
|
72,968
|
|
|
76,931
|
|
||||
International & Other
|
23,620
|
|
|
18,755
|
|
|
66,735
|
|
|
58,058
|
|
||||
Total Segment Profit
|
263,679
|
|
|
270,606
|
|
|
867,666
|
|
|
886,039
|
|
||||
Net Unallocated Expense
|
4,457
|
|
|
9,584
|
|
|
31,754
|
|
|
297
|
|
||||
Noncontrolling Interest
|
141
|
|
|
(22
|
)
|
|
103
|
|
|
279
|
|
||||
Earnings Before Income Taxes
|
$
|
259,364
|
|
|
$
|
261,000
|
|
|
$
|
836,014
|
|
|
$
|
886,021
|
|
|
Thirteen Weeks Ended
|
|
Thirty-Nine Weeks Ended
|
||||||||||||
(in thousands)
|
July 26,
2020 |
|
July 28,
2019 |
|
July 26,
2020 |
|
July 28,
2019 |
||||||||
U.S. Retail
|
$
|
1,390,075
|
|
|
$
|
1,163,367
|
|
|
$
|
4,072,156
|
|
|
$
|
3,672,189
|
|
U.S. Foodservice
|
588,130
|
|
|
729,321
|
|
|
1,864,050
|
|
|
2,135,633
|
|
||||
U.S. Deli
|
238,076
|
|
|
229,386
|
|
|
721,748
|
|
|
693,377
|
|
||||
International
|
165,177
|
|
|
168,631
|
|
|
530,402
|
|
|
494,605
|
|
||||
Total
|
$
|
2,381,457
|
|
|
$
|
2,290,705
|
|
|
$
|
7,188,357
|
|
|
$
|
6,995,804
|
|
|
Thirteen Weeks Ended
|
|
Thirty-Nine Weeks Ended
|
||||||||||||
(in thousands)
|
July 26,
2020 |
|
July 28,
2019 |
|
July 26,
2020 |
|
July 28,
2019 |
||||||||
Perishable
|
$
|
1,365,741
|
|
|
$
|
1,355,765
|
|
|
$
|
4,016,266
|
|
|
$
|
4,014,372
|
|
Shelf-stable
|
511,732
|
|
|
417,535
|
|
|
1,581,789
|
|
|
1,299,263
|
|
||||
Poultry
|
426,345
|
|
|
427,622
|
|
|
1,368,386
|
|
|
1,296,677
|
|
||||
Miscellaneous
|
77,640
|
|
|
89,783
|
|
|
221,915
|
|
|
385,492
|
|
||||
Total
|
2,381,457
|
|
|
$
|
2,290,705
|
|
|
$
|
7,188,357
|
|
|
$
|
6,995,804
|
|
•
|
The Company continued to experience demand shifts from its foodservice business to its retail business due to the impact of the COVID-19 pandemic. Retail demand remained elevated during the quarter, while foodservice demand showed signs of recovery as shelter-in-place restrictions were eased and phased re-openings began.
|
•
|
Grocery Products profit increased as improved sales and favorable product mix drove the significant increase in segment profit.
|
•
|
International & Other profit increased due to improved results in China and the Company's partners in the Philippines, South Korea and Europe.
|
•
|
Refrigerated Foods segment profit declined as a result of lower foodservice sales, incremental COVID-19 related costs and losses on strategic hog hedge positions.
|
•
|
Jennie-O Turkey Store segment profit declined sharply primarily due to higher manufacturing and live production costs attributed to the impact of three plant pauses on the vertically integrated supply chain early in the quarter. Additionally, the business absorbed incremental COVID-19 related costs.
|
•
|
Year-to-date cash flow from operations was $878.1 million, up 53 percent compared to last year as increased demand drove lower inventory levels.
|
•
|
The Company issued a $1.0 billion, ten-year bond during the quarter at an annual interest rate of 1.8 percent. The proceeds from the offering will provide ample liquidity and allow the business to take advantage of strategic opportunities.
|
|
Thirteen Weeks Ended
|
|
Thirty-Nine Weeks Ended
|
||||||||||||||||||
(in thousands, except per share amounts)
|
July 26, 2020
|
|
July 28, 2019
|
|
%
Change
|
|
July 26, 2020
|
|
July 28, 2019
|
|
%
Change
|
||||||||||
Volume (lbs.)
|
1,165,214
|
|
|
1,123,504
|
|
|
3.7
|
|
|
3,585,273
|
|
|
3,500,404
|
|
|
2.4
|
|
||||
Organic Volume (1)
|
1,158,418
|
|
|
1,123,504
|
|
|
3.1
|
|
|
3,574,747
|
|
|
3,428,441
|
|
|
4.3
|
|
||||
Net Sales
|
$
|
2,381,457
|
|
|
$
|
2,290,705
|
|
|
4.0
|
|
|
$
|
7,188,357
|
|
|
$
|
6,995,804
|
|
|
2.8
|
|
Organic Net Sales (1)
|
2,341,069
|
|
|
2,290,705
|
|
|
2.2
|
|
|
7,126,358
|
|
|
6,861,327
|
|
|
3.9
|
|
||||
Earnings Before Income Taxes
|
259,364
|
|
|
261,000
|
|
|
(0.6
|
)
|
|
836,014
|
|
|
886,021
|
|
|
(5.6
|
)
|
||||
Net Earnings Attributable to Hormel Foods Corporation
|
203,119
|
|
|
199,449
|
|
|
1.8
|
|
|
673,726
|
|
|
723,303
|
|
|
(6.9
|
)
|
||||
Diluted Earnings per Share
|
0.37
|
|
|
0.37
|
|
|
—
|
|
|
1.23
|
|
|
1.33
|
|
|
(7.5
|
)
|
ORGANIC VOLUME AND NET SALES (NON-GAAP)
|
||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||||
|
Thirteen Weeks Ended
|
|||||||||||||||||||||
|
July 26, 2020
|
|
July 28, 2019
|
|
|
|||||||||||||||||
(in thousands)
|
Reported GAAP
|
Acquisitions
|
Organic (Non-GAAP)
|
|
Reported GAAP
|
Divestitures
|
Organic (Non-GAAP)
|
|
Organic
% Change |
|||||||||||||
Volume (lbs.)
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Grocery Products
|
307,198
|
|
—
|
|
307,198
|
|
|
290,658
|
|
—
|
|
290,658
|
|
|
5.7
|
|
||||||
Refrigerated Foods
|
605,546
|
|
(6,795
|
)
|
598,751
|
|
|
558,531
|
|
—
|
|
558,531
|
|
|
7.2
|
|
||||||
Jennie-O Turkey Store
|
171,313
|
|
—
|
|
171,313
|
|
|
189,146
|
|
—
|
|
189,146
|
|
|
(9.4
|
)
|
||||||
International & Other
|
81,156
|
|
—
|
|
81,156
|
|
|
85,169
|
|
—
|
|
85,169
|
|
|
(4.7
|
)
|
||||||
Total Volume
|
1,165,214
|
|
(6,795
|
)
|
1,158,418
|
|
|
1,123,504
|
|
—
|
|
1,123,504
|
|
|
3.1
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Net Sales
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Grocery Products
|
$
|
580,798
|
|
$
|
—
|
|
$
|
580,798
|
|
|
$
|
543,088
|
|
$
|
—
|
|
$
|
543,088
|
|
|
6.9
|
|
Refrigerated Foods
|
1,363,092
|
|
(40,388
|
)
|
1,322,704
|
|
|
1,301,101
|
|
—
|
|
1,301,101
|
|
|
1.7
|
|
||||||
Jennie-O Turkey Store
|
286,805
|
|
—
|
|
286,805
|
|
|
298,781
|
|
—
|
|
298,781
|
|
|
(4.0
|
)
|
||||||
International & Other
|
150,762
|
|
—
|
|
150,762
|
|
|
147,735
|
|
—
|
|
147,735
|
|
|
2.0
|
|
||||||
Total Net Sales
|
$
|
2,381,457
|
|
$
|
(40,388
|
)
|
$
|
2,341,069
|
|
|
$
|
2,290,705
|
|
$
|
—
|
|
$
|
2,290,705
|
|
|
2.2
|
|
|
Thirty-Nine Weeks Ended
|
||||||||||||||||||||
|
July 26, 2020
|
|
July 28, 2019
|
|
|
||||||||||||||||
(in thousands)
|
Reported GAAP
|
Acquisitions
|
Organic (Non-GAAP)
|
|
Reported GAAP
|
Divestitures
|
Organic (Non-GAAP)
|
|
Organic
% Change |
||||||||||||
Volume (lbs.)
|
|
|
|
|
|
|
|
|
|
||||||||||||
Grocery Products
|
963,819
|
|
—
|
|
963,819
|
|
|
970,003
|
|
(69,910
|
)
|
900,093
|
|
|
7.1
|
||||||
Refrigerated Foods
|
1,787,698
|
|
(10,526
|
)
|
1,777,172
|
|
|
1,726,682
|
|
—
|
|
1,726,682
|
|
|
2.9
|
||||||
Jennie-O Turkey Store
|
577,990
|
|
—
|
|
577,990
|
|
|
546,916
|
|
—
|
|
546,916
|
|
|
5.7
|
||||||
International & Other
|
255,766
|
|
—
|
|
255,766
|
|
|
256,803
|
|
(2,052
|
)
|
254,751
|
|
|
0.4
|
||||||
Total Volume
|
3,585,273
|
|
(10,526
|
)
|
3,574,747
|
|
|
3,500,404
|
|
(71,962
|
)
|
3,428,441
|
|
|
4.3
|
||||||
|
|
|
|
|
|
|
|
|
|
||||||||||||
Net Sales
|
|
|
|
|
|
|
|
|
|
||||||||||||
Grocery Products
|
$
|
1,804,674
|
|
$
|
—
|
|
$
|
1,804,674
|
|
|
$
|
1,785,232
|
|
$
|
(130,588
|
)
|
$
|
1,654,644
|
|
|
9.1
|
Refrigerated Foods
|
3,962,219
|
|
(61,999
|
)
|
3,900,220
|
|
|
3,837,732
|
|
—
|
|
3,837,732
|
|
|
1.6
|
||||||
Jennie-O Turkey Store
|
959,988
|
|
—
|
|
959,988
|
|
|
925,271
|
|
—
|
|
925,271
|
|
|
3.8
|
||||||
International & Other
|
461,475
|
|
—
|
|
461,475
|
|
|
447,569
|
|
(3,889
|
)
|
443,680
|
|
|
4.0
|
||||||
Total Net Sales
|
$
|
7,188,357
|
|
$
|
(61,999
|
)
|
$
|
7,126,358
|
|
|
$
|
6,995,804
|
|
$
|
(134,477
|
)
|
$
|
6,861,327
|
|
|
3.9
|
|
Thirteen Weeks Ended
|
|
Thirty-Nine Weeks Ended
|
||||||||||||||||
(in thousands)
|
July 26, 2020
|
|
July 28,
2019 |
|
%
Change
|
|
July 26, 2020
|
|
July 28,
2019 |
|
%
Change
|
||||||||
Cost of Products Sold
|
$
|
1,959,032
|
|
|
$
|
1,857,263
|
|
|
5.5
|
|
$
|
5,820,158
|
|
|
$
|
5,604,879
|
|
|
3.8
|
|
Thirteen Weeks Ended
|
|
|
Thirty-Nine Weeks Ended
|
||||||||||||||||||
(in thousands)
|
July 26,
2020 |
|
July 28,
2019 |
|
%
Change
|
|
|
July 26,
2020 |
|
July 28,
2019 |
|
%
Change
|
||||||||||
Gross Profit
|
$
|
422,426
|
|
|
$
|
433,442
|
|
|
(2.5
|
)
|
|
|
$
|
1,368,198
|
|
|
$
|
1,390,925
|
|
|
(1.6
|
)
|
Percentage of Net Sales
|
17.7
|
%
|
|
18.9
|
%
|
|
|
|
|
19.0
|
%
|
|
19.9
|
%
|
|
|
|
Thirteen Weeks Ended
|
|
Thirty-Nine Weeks Ended
|
||||||||||||||||
(in thousands)
|
July 26, 2020
|
|
July 28,
2019 |
|
%
Change
|
|
July 26, 2020
|
|
July 28,
2019 |
|
%
Change
|
||||||||
SG&A
|
$
|
181,085
|
|
|
$
|
180,169
|
|
|
0.5
|
|
$
|
570,518
|
|
|
$
|
543,789
|
|
|
4.9
|
Percentage of Net Sales
|
7.6
|
%
|
|
7.9
|
%
|
|
|
|
7.9
|
%
|
|
7.8
|
%
|
|
|
|
Thirteen Weeks Ended
|
|
Thirty-Nine Weeks Ended
|
|||||||||||||||||
(in thousands)
|
July 26, 2020
|
|
July 28, 2019
|
|
%
Change
|
|
July 26, 2020
|
|
July 28, 2019
|
|
%
Change
|
|||||||||
Equity in Earnings of Affiliates
|
$
|
8,235
|
|
|
$
|
3,384
|
|
|
143.4
|
|
$
|
25,843
|
|
|
$
|
28,133
|
|
|
(8.1
|
)
|
|
Thirteen Weeks Ended
|
|
Thirty-Nine Weeks Ended
|
||||||||
|
July 26, 2020
|
|
July 28, 2019
|
|
July 26,
2020 |
|
July 28,
2019 |
||||
Effective Tax Rate
|
21.6
|
%
|
|
23.6
|
%
|
|
19.4
|
%
|
|
18.3
|
%
|
|
Thirteen Weeks Ended
|
|
Thirty-Nine Weeks Ended
|
||||||||||||||||||
(in thousands)
|
July 26, 2020
|
|
July 28, 2019
|
|
% Change
|
|
July 26, 2020
|
|
July 28,
2019 |
|
% Change
|
||||||||||
Net Sales
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Grocery Products
|
$
|
580,798
|
|
|
$
|
543,088
|
|
|
6.9
|
|
|
$
|
1,804,674
|
|
|
$
|
1,785,232
|
|
|
1.1
|
|
Refrigerated Foods
|
1,363,092
|
|
|
1,301,101
|
|
|
4.8
|
|
|
3,962,219
|
|
|
3,837,732
|
|
|
3.2
|
|
||||
Jennie-O Turkey Store
|
286,805
|
|
|
298,781
|
|
|
(4.0
|
)
|
|
959,988
|
|
|
925,271
|
|
|
3.8
|
|
||||
International & Other
|
150,762
|
|
|
147,735
|
|
|
2.0
|
|
|
461,475
|
|
|
447,569
|
|
|
3.1
|
|
||||
Total
|
$
|
2,381,457
|
|
|
$
|
2,290,705
|
|
|
4.0
|
|
|
$
|
7,188,357
|
|
|
$
|
6,995,804
|
|
|
2.8
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Segment Profit
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Grocery Products
|
$
|
80,169
|
|
|
$
|
58,778
|
|
|
36.4
|
|
|
$
|
276,367
|
|
|
$
|
258,574
|
|
|
6.9
|
|
Refrigerated Foods
|
152,822
|
|
|
171,795
|
|
|
(11.0
|
)
|
|
451,596
|
|
|
492,476
|
|
|
(8.3
|
)
|
||||
Jennie-O Turkey Store
|
7,069
|
|
|
21,278
|
|
|
(66.8
|
)
|
|
72,968
|
|
|
76,931
|
|
|
(5.2
|
)
|
||||
International & Other
|
23,620
|
|
|
18,755
|
|
|
25.9
|
|
|
66,735
|
|
|
58,058
|
|
|
14.9
|
|
||||
Total Segment Profit
|
263,679
|
|
|
270,606
|
|
|
(2.6
|
)
|
|
867,666
|
|
|
886,039
|
|
|
(2.1
|
)
|
||||
Net Unallocated Expense
|
4,457
|
|
|
9,584
|
|
|
(53.5
|
)
|
|
31,754
|
|
|
297
|
|
|
10,570.7
|
|
||||
Noncontrolling Interest
|
141
|
|
|
(22
|
)
|
|
(744.6
|
)
|
|
103
|
|
|
279
|
|
|
(63.3
|
)
|
||||
Earnings Before Income Taxes
|
$
|
259,364
|
|
|
$
|
261,000
|
|
|
(0.6
|
)
|
|
$
|
836,014
|
|
|
$
|
886,021
|
|
|
(5.6
|
)
|
|
|
Thirteen Weeks Ended
|
|
Thirty-Nine Weeks Ended
|
|||||||||||||||||
(in thousands)
|
July 26,
2020 |
|
July 28,
2019 |
|
%
Change
|
|
July 26,
2020 |
|
July 28,
2019 |
|
%
Change
|
|||||||||
Volume (lbs.)
|
307,198
|
|
|
290,658
|
|
|
5.7
|
|
963,819
|
|
|
970,003
|
|
|
(0.6
|
)
|
||||
Net Sales
|
$
|
580,798
|
|
|
$
|
543,088
|
|
|
6.9
|
|
$
|
1,804,674
|
|
|
$
|
1,785,232
|
|
|
1.1
|
|
Segment Profit
|
80,169
|
|
|
58,778
|
|
|
36.4
|
|
276,367
|
|
|
258,574
|
|
|
6.9
|
|
|
Thirteen Weeks Ended
|
|
Thirty-Nine Weeks Ended
|
||||||||||||||||||
(in thousands)
|
July 26,
2020 |
|
July 28,
2019 |
|
%
Change
|
|
July 26,
2020 |
|
July 28,
2019 |
|
%
Change
|
||||||||||
Volume (lbs.)
|
605,546
|
|
|
558,531
|
|
|
8.4
|
|
|
1,787,698
|
|
|
1,726,682
|
|
|
3.5
|
|
||||
Net Sales
|
$
|
1,363,092
|
|
|
$
|
1,301,101
|
|
|
4.8
|
|
|
$
|
3,962,219
|
|
|
$
|
3,837,732
|
|
|
3.2
|
|
Segment Profit
|
152,822
|
|
|
171,795
|
|
|
(11.0
|
)
|
|
451,596
|
|
|
492,476
|
|
|
(8.3
|
)
|
|
Thirteen Weeks Ended
|
|
Thirty-Nine Weeks Ended
|
||||||||||||||||||
(in thousands)
|
July 26,
2020 |
|
July 28,
2019 |
|
%
Change
|
|
July 26,
2020 |
|
July 28,
2019 |
|
%
Change
|
||||||||||
Volume (lbs.)
|
171,313
|
|
|
189,146
|
|
|
(9.4
|
)
|
|
577,990
|
|
|
546,916
|
|
|
5.7
|
|
||||
Net Sales
|
$
|
286,805
|
|
|
$
|
298,781
|
|
|
(4.0
|
)
|
|
$
|
959,988
|
|
|
$
|
925,271
|
|
|
3.8
|
|
Segment Profit
|
7,069
|
|
|
21,278
|
|
|
(66.8
|
)
|
|
72,968
|
|
|
76,931
|
|
|
(5.2
|
)
|
|
Thirteen Weeks Ended
|
|
Thirty-Nine Weeks Ended
|
||||||||||||||||||
(in thousands)
|
July 26,
2020 |
|
July 28,
2019 |
|
%
Change
|
|
July 26,
2020 |
|
July 28,
2019 |
|
%
Change
|
||||||||||
Volume (lbs.)
|
81,156
|
|
|
85,169
|
|
|
(4.7
|
)
|
|
255,766
|
|
|
256,803
|
|
|
(0.4
|
)
|
||||
Net Sales
|
$
|
150,762
|
|
|
$
|
147,735
|
|
|
2.0
|
|
|
$
|
461,475
|
|
|
$
|
447,569
|
|
|
3.1
|
|
Segment Profit
|
23,620
|
|
|
18,755
|
|
|
25.9
|
|
|
66,735
|
|
|
58,058
|
|
|
14.9
|
|
|
Thirteen Weeks Ended
|
|
Thirty-Nine Weeks Ended
|
||||||||||||
(in thousands)
|
July 26,
2020 |
|
July 28,
2019 |
|
July 26,
2020 |
|
July 28,
2019 |
||||||||
Net Unallocated Expense
|
$
|
4,457
|
|
|
$
|
9,584
|
|
|
$
|
31,754
|
|
|
$
|
297
|
|
Net Earnings (Loss) Attributable to Noncontrolling Interest
|
141
|
|
|
(22
|
)
|
|
103
|
|
|
279
|
|
(a)
|
Disclosure Controls and Procedures.
|
(b)
|
Internal Controls.
|
▪
|
food spoilage;
|
▪
|
food contamination caused by disease-producing organisms or pathogens, such as Listeria monocytogenes, Salmonella, and pathogenic E. coli;
|
▪
|
food allergens;
|
▪
|
nutritional and health-related concerns;
|
▪
|
federal, state, and local food processing controls;
|
▪
|
consumer product liability claims;
|
▪
|
product tampering; and
|
▪
|
the possible unavailability and/or expense of liability insurance.
|
▪
|
The financial stability of our customers and suppliers may be compromised, which could result in additional bad debts for the Company or non-performance by suppliers; and
|
▪
|
The value of our investments in debt and equity securities may decline, including most significantly the Company’s trading securities held as part of a rabbi trust to fund supplemental executive retirement plans and deferred income plans, and the Company’s assets held in pension plans.
|
•
|
One or more of the Company's manufacturing facilities may be shutdown or have their operations significantly impacted due to employee illnesses, increased absenteeism, and/or actions by government agencies. Capital projects may be delayed as additional capacity is no longer currently needed. The Company's co-manufacturers and material suppliers may face similar impacts.
|
•
|
Regulatory restrictions and measures taken at the Company's facilities to prevent or slowdown the spread of COVID-19 may impact facilities’ efficiency.
|
•
|
Operating costs may increase as measures are put in place to prevent or slowdown the spread of COVID-19, such as facility improvements, employee testing, short term disability policies, and manufacturing employee bonus payments.
|
•
|
Any new or additional measures required by national, state or local governments to combat COVID-19 may similarly add additional operational costs.
|
•
|
Ongoing closure or reduced operations at foodservice establishments may impact results for the Company's foodservice business. Bankruptcy filings and/or delinquent payments from foodservice industry or other customers may negatively impact cash flow.
|
•
|
A national and/or global economic downturn may impact consumer purchase behavior, such as reduced foodservice volume, lower volume in premium brands, and potential loss of business to private label.
|
•
|
It may become more difficult and/or expensive to obtain debt or equity financing necessary to sustain the Company's operations, make capital expenditures, and/or finance future acquisitions.
|
•
|
The Company may face litigation by stockholders, employees, suppliers, customers, consumers, and others relating to COVID-19 and its effects.
|
•
|
The Company relies on its dedicated employees, many of whom have a long tenure with the Company. Operations may be negatively impacted if members of the Company's leadership team, or other key employees, become ill with COVID-19 or otherwise terminate their employment as a result of COVID-19. Further, the Company may face challenges hiring, onboarding, and training new employees, including leadership, which may impact results. The Company may also face operational challenges if government quarantine orders restrict movement of employees.
|
•
|
It is possible that the COVID-19 pandemic could negatively affect the Company's labor availability, relations, or labor costs.
|
•
|
In accordance with recommendations to reduce large gatherings and increase social distancing, many of the Company's office-based employees are working remotely, which may bring additional information technology and data security risks.
|
•
|
Supply chain disruptions of various types arising from COVID-19 may impact the Company's ability to make products, the cost for such products, and the ability to deliver products to customers. Closure or reduced operations of material suppliers could result in shortages of key raw materials, as well as impact prices for those materials. The volatility in the market for raw material and supplies could impact the Company's profitability.
|
•
|
National, state, and local government orders closing or limiting operation of borders and ports, or imposing quarantine, could impact the Company's ability to obtain raw materials and to deliver finished goods to customers.
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COVID-19 has wide-reaching impacts to society and the business making all decisions, interactions, and transactions significantly more complex.
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The Company is committed to being transparent through communications to inform shareholders, employees, customers, consumers, and others about the enhanced safety protocols implemented. The Company must keep pace with a rapidly changing media environment. If the Company's public relations efforts are not effective or if consumers perceive them to be irresponsible, the Company's competitive position, reputation, and market share may suffer.
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price;
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product quality and attributes;
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brand identification;
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breadth of product line; and
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customer service.
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101
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The following financial statements from the Company's Quarterly Report on Form 10-Q for the quarter ended July 26, 2020, formatted in Inline XBRL: (i) Consolidated Statements of Financial Position, (ii) Consolidated Statements of Operations, (iii) Consolidated Statements of Comprehensive Income, (iv) Consolidated Statements of Changes in Shareholders' Investment, (v) Consolidated Statements of Cash Flows, and (vi) Notes to Consolidated Financial Statements, tagged as blocks of text and including detailed tags.
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104
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The cover page from the Company's Quarterly Report on Form 10-Q for the quarter ended July 26, 2020, formatted in Inline XBRL (included as Exhibit 101).
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HORMEL FOODS CORPORATION
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(Registrant)
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Date: September 1, 2020
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By
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/s/ JAMES N. SHEEHAN
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JAMES N. SHEEHAN
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Executive Vice President and Chief Financial Officer
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(Principal Financial Officer)
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Date: September 1, 2020
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By
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/s/ JANA L. HAYNES
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JANA L. HAYNES
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Vice President and Controller
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(Principal Accounting Officer)
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1 Year Hormel Foods Chart |
1 Month Hormel Foods Chart |
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