Hormel Foods(HRL)2024-12-05 19:40Customer Concentration - The Company reported that sales to its largest customer, Walmart Inc., accounted for approximately 16% of consolidated gross sales during fiscal 2024[31]. - The top five customers collectively represented about 37% of consolidated gross sales during fiscal 2024[31]. Employee Information - As of October 27, 2024, the Company had approximately 20,000 active employees, with over 90% located in the U.S.[19]. - Approximately 50% of the Company's team members had five or more years of service as of October 27, 2024[22]. Patents and Intellectual Property - The Company holds 22 U.S. patents and eight foreign patents as of October 27, 2024[34]. Sustainability Efforts - The Company has set aspirational goals to improve sustainability efforts, including reducing greenhouse gas emissions and organic waste[30]. Risk Management - The Company utilizes futures, swaps, and options contracts to hedge a portion of its anticipated purchases to manage input cost risks[17]. - The Company is exposed to various forms of market risk, including commodity price risk and foreign currency exchange rate risk[235]. Financial Position - The Company's long-term debt had a fair value of 2.7 billion as of October 29, 2023[237]. - The net asset position in foreign currencies increased to 1.1 billion as of October 29, 2023[238]. - The balance of corporate-owned life insurance policies classified as trading securities totaled 188.2 million as of October 29, 2023[239]. Financial Performance - Net sales for the fiscal year ended October 27, 2024, were 12,110,010 in the previous year[270]. - Gross profit increased to 1,999,841 year-over-year[270]. - Operating income slightly decreased to 1,072,046 in the prior year, reflecting a decline of 0.2%[270]. - Net earnings attributable to Hormel Foods Corporation were 793,572 in the previous year[270]. - Basic and diluted net earnings per share both increased to 1.45 year-over-year[270]. - Comprehensive income attributable to Hormel Foods Corporation was 776,881, an increase of 4.8%[272]. Asset Management - Total current assets decreased to 3,297,249, a decline of 1.54%[274]. - Total assets slightly decreased to 13,448,772, a decline of 0.1%[274]. - Cash and cash equivalents increased to 736,532, a slight increase of 0.5%[274]. Debt Management - Long-term debt increased to 2,358,719, reflecting a rise of 20.8%[274]. - The company repaid 1.13 per share for the fiscal year ending October 27, 2024, compared to 28.4 million intangible asset impairment charge for the Justin's trade name[310]. - The carrying amount of goodwill decreased to 4,928.5 million as of October 29, 2023, primarily due to the divestiture of Hormel Health Labs[344]. Revenue Recognition - The Company recognizes revenue at the point in time when performance obligations have been satisfied, typically when the ordered product is received or picked up by the customer[320]. Research and Development - Research and development expenses for fiscal years 2024, 2023, and 2022 were 33.7 million, and 34.7 million, respectively, showing a year-over-year increase in R&D investment[327]. Investment Activities - The Company completed the divestiture of Hormel Health Labs for a preliminary purchase price of 25.0 million, resulting in a pre-tax gain of 425.8 million, enhancing its presence in Southeast Asia[351]. Inventory Management - Total inventories decreased to 1.68 billion a year earlier, a decline of 6.2%[355]. Pension and Retirement Plans - The Company had 87.3 million in private equity and real estate funds[264]. - The net periodic cost for defined benefit plans was 37,413,000 for the year ended October 29, 2023, reflecting an increase of 18.5%[374]. - The benefit obligation at the end of the year for pension plans was 1,174,380,000 as of October 29, 2023, showing a rise of 14.1%[375]. Accounting and Reporting - The Company maintained effective internal control over financial reporting as of October 27, 2024, as confirmed by independent auditors[246]. - The consolidated financial statements present fairly the financial position of the Company at October 27, 2024, in conformity with U.S. generally accepted accounting principles[258]. - The audit of the Company's internal control over financial reporting was conducted in accordance with PCAOB standards, resulting in an unqualified opinion[259].