Document and Entity Information
Document and Entity Information - shares | 6 Months Ended | |
Jun. 30, 2018 | Aug. 08, 2018 | |
Document and Entity Information [Abstract] | ||
Document Type | 10-Q | |
Amendment Flag | false | |
Document Period End Date | Jun. 30, 2018 | |
Document Fiscal Period Focus | Q2 | |
Document Fiscal Year Focus | 2,018 | |
Entity Registrant Name | WEIS MARKETS INC | |
Trading Symbol | wmk | |
Entity Central Index Key | 105,418 | |
Current Fiscal Year End Date | --12-29 | |
Entity Filer Category | Accelerated Filer | |
Entity Common Stock, Shares Outstanding | 26,898,443 |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Thousands | Jun. 30, 2018 | Dec. 30, 2017 |
Current: | ||
Cash and cash equivalents | $ 34,623 | $ 47,917 |
Marketable securities | 58,734 | 63,665 |
SERP investment | 15,890 | 14,476 |
Accounts receivable, net | 52,835 | 56,265 |
Inventories | 273,416 | 279,509 |
Prepaid expenses and other current assets | 17,429 | 19,435 |
Income taxes recoverable | 0 | 2,047 |
Total current assets | 452,927 | 483,314 |
Property and equipment, net | 886,223 | 886,243 |
Goodwill | 52,330 | 52,330 |
Intangible and other assets, net | 20,785 | 19,852 |
Total assets | 1,412,265 | 1,441,739 |
Current: | ||
Accounts payable | 192,209 | 216,252 |
Accrued expenses | 37,891 | 33,403 |
Accrued self-insurance | 16,949 | 17,470 |
Deferred revenue, net | 5,212 | 7,217 |
Income taxes payable | 6,382 | 0 |
Total current liabilities | 258,643 | 274,342 |
Long-term debt | 0 | 34,988 |
Postretirement benefit obligations | 19,059 | 18,409 |
Accrued self-insurance | 20,132 | 20,140 |
Deferred income taxes | 88,643 | 87,422 |
Other | 14,205 | 13,594 |
Total liabilities | 400,682 | 448,895 |
Shareholders' Equity | ||
Common stock, no par value, 100,800,000 shares authorized, 33,047,807 shares issued, 26,898,443 shares outstanding | 9,949 | 9,949 |
Retained earnings | 1,152,499 | 1,127,872 |
Accumulated other comprehensive income (Net of deferred taxes of $1 in 2018 and $2,310 in 2017) | (8) | 5,880 |
Shareholders' equity before treasury stock | 1,162,440 | 1,143,701 |
Treasury stock at cost, 6,149,364 shares | (150,857) | (150,857) |
Total shareholders' equity | 1,011,583 | 992,844 |
Total liabilities and shareholders' equity | $ 1,412,265 | $ 1,441,739 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Thousands | 6 Months Ended | 12 Months Ended |
Jun. 30, 2018 | Dec. 30, 2017 | |
Consolidated Balance Sheets [Abstract] | ||
Common stock, par value | $ 0 | $ 0 |
Common stock, shares authorized | 100,800,000 | 100,800,000 |
Common stock, shares issued | 33,047,807 | 33,047,807 |
Common stock, shares outstanding | 26,898,443 | 26,898,443 |
Accumulated other comprehensive income, deferred taxes | $ 1 | $ 2,310 |
Treasury stock, shares | 6,149,364 | 6,149,364 |
Consolidated Statements of Inco
Consolidated Statements of Income - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2018 | Jul. 01, 2017 | Jun. 30, 2018 | Jul. 01, 2017 | |
Consolidated Statements of Income [Abstract] | ||||
Net sales | $ 871,100 | $ 876,569 | $ 1,747,206 | $ 1,728,798 |
Cost of sales, including advertising, warehousing and distribution expenses | 630,805 | 642,811 | 1,272,004 | 1,266,004 |
Gross profit on sales | 240,295 | 233,758 | 475,202 | 462,794 |
Operating, general and administrative expenses | 214,258 | 206,040 | 426,326 | 414,826 |
Income from operations | 26,037 | 27,718 | 48,876 | 47,968 |
Investment income and interest expense | 105 | 412 | (427) | 1,236 |
Income before provision for income taxes | 26,142 | 28,130 | 48,449 | 49,204 |
Provision for income taxes | 7,047 | 9,655 | 13,163 | 18,893 |
Net income | $ 19,095 | $ 18,475 | $ 35,286 | $ 30,311 |
Weighted-average shares outstanding, basic and diluted | 26,898,443 | 26,898,443 | 26,898,443 | 26,898,443 |
Cash dividends per share | $ 0.30 | $ 0.30 | $ 0.60 | $ 0.60 |
Basic and diluted earnings per share | $ 0.71 | $ 0.69 | $ 1.31 | $ 1.13 |
Consolidated Statements of Comp
Consolidated Statements of Comprehensive Income - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2018 | Jul. 01, 2017 | Jun. 30, 2018 | Jul. 01, 2017 | |
Consolidated Statements of Comprehensive Income [Abstract] | ||||
Net income | $ 19,095 | $ 18,475 | $ 35,286 | $ 30,311 |
Other comprehensive income (loss) by component, net of tax: | ||||
Unrealized holding losses arising during period (Net of deferred taxes of $14 and $137, respectively for the thirteen Weeks Ended and $172 and $126, respectively for the twenty six Weeks Ended) | (42) | (198) | (445) | (134) |
Reclassification adjustment for losses included in net income (Net of deferred taxes of $15 and $0, respectively for the twenty six Weeks Ended) | 39 | |||
Other comprehensive loss, net of tax | (42) | (198) | (406) | (134) |
Comprehensive income, net of tax | $ 19,053 | $ 18,277 | $ 34,880 | $ 30,177 |
Consolidated Statements of Com6
Consolidated Statements of Comprehensive Income (Parenthetical) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2018 | Jul. 01, 2017 | Jun. 30, 2018 | Jul. 01, 2017 | |
Consolidated Statements of Comprehensive Income [Abstract] | ||||
Unrealized holding gains arising during period, deferred taxes | $ 14 | $ 137 | $ 172 | $ 126 |
Reclassification adjustment for gains included in net income, deferred taxes | $ 15 | $ 0 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 6 Months Ended | |
Jun. 30, 2018 | Jul. 01, 2017 | |
Cash flows from operating activities: | ||
Net income | $ 35,286 | $ 30,311 |
Adjustments to reconcile net income to net cash provided by operating activities: | ||
Depreciation and amortization | 46,137 | 42,160 |
(Gain) loss on disposition of fixed assets | 157 | (1,034) |
Loss on sale of marketable securities | 54 | 0 |
Unrealized loss in value of equity securities | 1,238 | 0 |
Deferred income taxes | 1,379 | 5,757 |
Changes in operating assets and liabilities: | ||
Inventories | 6,093 | 9,706 |
Accounts receivable and prepaid expenses | 5,436 | 15,371 |
Accounts payable and other liabilities | (20,538) | (40,409) |
Income taxes | 8,429 | 910 |
Other | 556 | 490 |
Net cash provided by operating activities | 84,227 | 63,262 |
Cash flows from investing activities: | ||
Purchase of property and equipment | (46,367) | (40,334) |
Proceeds from the sale of property and equipment | 321 | 2,106 |
Purchase of marketable securities | (586) | (6,788) |
Proceeds from maturities of marketable securities | 2,800 | 5,802 |
Proceeds from the sale of marketable securities | 514 | 4,806 |
Purchase of intangible assets | (1,662) | (1,267) |
Change in SERP investment | (1,414) | (2,052) |
Net cash used in investing activities | (46,394) | (37,727) |
Cash flows from financing activities: | ||
Payments on long-term debt | (34,988) | (12,525) |
Dividends paid | (16,139) | (16,139) |
Net cash used in financing activities | (51,127) | (28,664) |
Net decrease in cash and cash equivalents | (13,294) | (3,129) |
Cash and cash equivalents at beginning of year | 47,917 | 46,818 |
Cash and cash equivalents at end of period | $ 34,623 | $ 43,689 |
Consolidated Statements Of Cas8
Consolidated Statements Of Cash Flows (Parenthetical) - USD ($) $ in Thousands | 6 Months Ended | |
Jun. 30, 2018 | Jul. 01, 2017 | |
Consolidated Statements of Cash Flows [Abstract] | ||
Income taxes paid | $ 3,400 | $ 12,400 |
Interest paid | $ 318 | $ 540 |
Significant Accounting Policies
Significant Accounting Policies | 6 Months Ended |
Jun. 30, 2018 | |
Significant Accounting Policies [Abstract] | |
Significant Accounting Policies | (1) Significant Accounting Policies Basis of Presentation: The accompanying unaudited Consolidated Financial Statements have been prepared in accordance with accounting principles generally accepted in the United States for interim financial information and with the instructions for Form 10-Q and Article 10 of Regulation S-X. In the opinion of management, all adjustments (consisting of normal recurring deferrals and accruals) considered necessary for a fair presentation have been included. The operating results for the periods presented are not necessarily indicative of the results to be expected for the full year. The Company has evaluated subsequent events for disclosure through the date of issuance of the accompanying unaudited consolidated interim financial statements and there were no material subsequent events which require additional disclosure. For further information, refer to the Consolidated Financial Statements and footnotes thereto included in the Company's latest Annual Report on Form 10-K. As of December 31, 2017, the Company changed its accounting policy for cash and cash equivalents and advertising costs. See Note 7 Cash and Cash Equivalents and Advertising Accounting Policies. |
Current Relevant Accounting Sta
Current Relevant Accounting Standards | 6 Months Ended |
Jun. 30, 2018 | |
Current Relevant Accounting Standards [Abstract] | |
Current Relevant Accounting Standards | ( 2) Current Relevant Accounting Standards In May 2014, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) 2014-09, Revenue from Contracts with Customers (Topic 606) , as amended by several subsequent ASU’s, which establishes principles for recognizing revenue upon the transfer of promised goods or services to customers, in an amount that reflects the expected consideration received in exchange for those goods or services. In August 2015, the FASB issued a one-year deferral of the effective date of this new guidance resulting in it now being effective for the Company beginning in fiscal year 2018. The Company has evaluated the impact of adoption of the ASU. The Company’s assessment of the new guidance has identified customer loyalty programs and gift cards affected by the new guidance. The Company adopted the new standard using the modified retrospective method beginning December 31, 2017. T he effects related to these transactions did not materially effect the Company’s Co nsolidated Financial Statements. The Company determined that the adoption of the ASU did not have a significant impact on the Company’s point of sale product sales. In January 2016, the FASB issued ASU 2016-01 Financial Instruments – Overall (Subtopic 825-10): Recognition and Measurement of Financial Assets and Financial Liabilities . ASU 2016-01 generally requires that equity investments (excluding equity method investments) be measured at fair value with changes in fair value recognized in net income. The adoption of ASU 2016-01 had an impact on the net income reported in the Company’s Consolidated Statements of Income in the amount of $0.5 million and $1.2 million for the second quarter and the first twenty-six weeks of 2018, respectively. The ASU was adopted as of December 31, 2017. The cumulative effect of the adoption was made to the balance sheet as of December 31, 2017 and resulted in a reclassification of $5.5 million of related accumulated unrealized gains , net of applicable deferred income taxes, that were included in accumulated other comprehensive income to retained earnings, resulting in no impact on the Company’s shareholders’ equity. In February 2016, the FASB issued ASU 2016-02 Lea ses (Topic 842). ASU 2016-02 requires lessees to recognize assets and liabilities for the rights and obligations created by their leases with lease terms more than 12 months. ASU 2016-02 will become effective for annual periods beginning after December 15, 2018 and for interim periods within those fiscal years. The Company is currently in the process of evaluating the impact of adoption of the ASU and expects the adoption to have a significant impact on the Company’s Consolidated Balance Sheets . In March 2016, the FASB issued ASU 2016-04 Liabilities – Extinguishments of Liabilities (Subtopic 405-20) Recognition of Breakage for Certain Prepaid Stored-Value Products . ASU 2016-04 requires that an entity must disclose the methodology and specific judgements made in applying the breakage recognized. ASU 2016-04 will become effective for the financial statements issued for the fiscal years beginning after December 15, 2017. The Company has evaluated the effect of the adoption of the ASU and determined there was not a significant impact on the Company’s Consolidated Financial Statements. The Company adopted ASU 2016-04 beginning December 31, 2017 . |
Marketable Securities
Marketable Securities | 6 Months Ended |
Jun. 30, 2018 | |
Marketable Securities [Abstract] | |
Marketable Securities | (3) Marketable Securities The Company’s marketable securities are all classified as available-for-sale within “Current Assets” in the Company’s Consolidated Balance Sheets. FASB has established three levels of inputs that may be used to measure fair value: Level 1 Observable inputs such as quoted prices in active markets for identical assets or liabilities; Level 2 Observable inputs, other than Level 1 inputs 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 Company’s marketable securities valued using Level 1 inputs include highly liquid equity securities, for which quoted market prices are available . The Company’s municipal bond portfolio is valued using Level 2 inputs. The Company’s municipal bonds are valued using a combination of pricing for similar securities, recently executed transactions, cash flow models with yield curves and other pricing models utilizing observable inputs, which are considered Level 2 inputs. For Level 2 investment valuation, the Company utilizes standard pricing procedures of its investment advisory firm which includes various third party pricing services. These procedures also require specific price monitoring practices as well as pricing review reports, valuation oversight and pricing challenge procedures to maintain the most accurate representation of investment fair market value. The Company accrues interest on its bond portfolio throughout the life of each bond held. Dividends from the equity securities are recognized as received. I nterest , dividends and unrealized gains and losses on equity securities are recognized in “Investment income and interest expense” on the Company’s Consolidated Statements of Income. The Company recognized investment income of $178 thousand in the second quarter of 2018, which included an unrealized loss in equity securities of $459 thousand. An investment loss of $187 thousand, which included an unrealized loss in equity securities of $1.2 million, was recognized in the first half of 2018. Investment income was $672 thousand and $1.8 million in the thirteen and twenty-six weeks ended July 1, 201 7, respectively . Mar ketable securities, as of June 30, 2018 and December 30, 2017 , consisted of: Gross Gross (dollars in thousands) Amortized Unrealized Unrealized Fair June 30, 2018 Cost Holding Gains Holding Losses Value Available-for-sale: Level 1 Equity securities $ 1,198 $ 6,396 $ - $ 7,594 Level 2 Municipal bonds 51,161 274 (295) 51,140 $ 52,359 $ 6,670 $ (295) $ 58,734 Gross Gross (dollars in thousands) Amortized Unrealized Unrealized Fair December 30, 2017 Cost Holding Gains Holding Losses Value Available-for-sale: Level 1 Equity securities $ 1,198 $ 7,634 $ - $ 8,832 Level 2 Municipal bonds 54,278 671 (116) 54,833 $ 55,476 $ 8,305 $ (116) $ 63,665 Maturities of marketable securities classified as available-for-sale at June 30, 2018 , were as follows: Amortized Fair (dollars in thousands) Cost Value Available-for-sale: Due within one year $ 11,960 $ 11,973 Due after one year through five years 22,477 22,583 Due after five years through ten years 16,724 16,584 Equity securities 1,198 7,594 $ 52,359 $ 58,734 (3) Marketable Securities (continued) SERP Investments The Company also maintains a non-qualified supplemental executive retirement plan and a non-qualified pharmacist deferred compensation plan for certain of its associates which allows them to defer income to future periods. Participants in the plans earn a return on their deferrals based on mutual fund investments. The Company chooses to invest in the underlying mutual fund investments to offset the liability associated with the non-qualified deferred compensation plans. Such investments are classified as trading securities and are measured at fair value using Level 1 inputs with gains and losses included in “Investment income and interest expense” on the Company’s Consolidated Statements of Income. The changes in the underlying liability to the associates are recorded in “Operating, general and administrative expenses.” |
Accumulated Other Comprehensive
Accumulated Other Comprehensive Income | 6 Months Ended |
Jun. 30, 2018 | |
Accumulated Other Comprehensive Income [Abstract] | |
Accumulated Other Comprehensive Income | (4) Accumulated Other Comprehensive Income All balances in accumulated other comprehensive income are related to available-for-sale marketable securities. The following table sets forth the balance of the Company’s accumulated other comprehensive income, net of tax. Unrealized Gains on Available-for-Sale (dollars in thousands) Marketable Securities Accumulated other comprehensive income balance as of December 30, 2017 $ 5,880 Amount reclassified to retained earnings for equity unrealized gain (adoption of ASU 2016-01) (5,482) Other comprehensive loss before reclassifications (445) Amounts reclassified from accumulated other comprehensive income 39 Net current period change in other comprehensive income (5,888) Accumulated other comprehensive income balance as of June 30, 2018 $ (8) The following table sets forth the effects on net income of the amounts reclassified out of accumulated other comprehensive income for the periods ended June 30, 2018 and July 1, 2017 . Amounts Reclassified from Accumulated Other Comprehensive Income to the Consolidated Statements of Income 13 Weeks Ended 26 Weeks Ended (dollars in thousands) Location June 30, 2018 July 1, 2017 June 30, 2018 July 1, 2017 Unrealized gains (losses) on available-for-sale marketable securities Investment income and interest expense $ - $ - $ 54 $ - Provision for income taxes - - (15) - Total amount reclassified, net of tax $ - $ - $ 39 $ - |
Long-Term Debt
Long-Term Debt | 6 Months Ended |
Jun. 30, 2018 | |
Long-Term Debt [Abstract] | |
Long-Term Debt | ( 5 ) Long-Term Debt On September 1, 2016, Weis Markets entered into a revolving credit agreement with Wells Fargo Bank, National Association (the Credit Agreement). The Credit Agreement provides for an unsecured revolving credit facility with an aggregate principal amount not to exceed $100.0 million with an additi onal discretionary amount available of $50.0 million. As of June 30, 2018 , the Company did not have an outstanding amount borrowed from the available $100.0 million from the credit facility. The loan will bear interest on the outstanding principal amount at the one month LIBOR rate plus the applicable margin rate of 0.65% until its maturity on September 1, 2019 . The loan was used to fund the 2016 acquisitions and the Company’s working capital requirements. The only financial covenant in the credit facility requires the Company’s trailing twelve month EBITDA to be at least $75.0 million . The Credit Agreement is also being utilized by the Company for $14.4 million of outstanding letters of credit as of June 30, 2018 . The letters of credit are maintained primarily to support performance, payment, deposit or surety obligations of the Company. The Company does not anticipate drawing on any of them. Interest expense related to long-term debt was $73 thousand and $260 thousand in the second quarter of 2018 and 2017 , respectively. In the first half of 2018 and 2017 interest expense related to long-term debt totaled $240 thousand and $533 thousand, respectively. |
Revenue Recognition
Revenue Recognition | 6 Months Ended |
Jun. 30, 2018 | |
Revenue Recognition [Abstract] | |
Revenue Recognition | (6) Revenue Recognition The adoption of ASU 2014-9 Revenue from Contracts with Customers (ASC 606) did not have a material impact on the Company’s Consolidated Financial Statements. The Chief Operating Officer, the Company’s chief operating decision maker, analyzes store operational revenues by geographical area but each area offers customers similar product, has similar distribution methods, and supported by centralized management processes . The Company’s operations are reported as a single reportable segment . The following table represents net sales by type of product for the thirteen week and twenty-six week periods ending June 30, 2018 and July 1, 2017: 13 Weeks Ended ( dollars in thousands ) June 30, 2018 July 1, 2017 Grocery $ 757,894 87.0 % $ 768,824 87.6 % Pharmacy 78,271 9.0 78,573 9.0 Fuel 33,439 3.8 27,830 3.2 Manufacturing 1,496 0.2 1,342 0.2 Total net sales $ 871,100 100.0 % $ 876,569 100.0 % 26 Weeks Ended ( dollars in thousands ) June 30, 2018 July 1, 2017 Grocery $ 1,525,912 87.3 % $ 1,518,386 87.8 % Pharmacy 156,211 8.9 154,823 9.0 Fuel 62,084 3.6 52,280 3.0 Manufacturing 2,999 0.2 3,309 0.2 Total net sales $ 1,747,206 100.0 % $ 1,728,798 100.0 % |
Cash And Cash Equivalents And A
Cash And Cash Equivalents And Advertising Accounting Policies | 6 Months Ended |
Jun. 30, 2018 | |
Cash And Cash Equivalents And Advertising Accounting Policies [Abstract] | |
Cash And Cash Equivalents And Advertising Accounting Policies | (7) Cash and Cash Equivalents and Advertising Accounting Policies As of December 31, 2017, the Company changed its policy for cash and cash equivalents to include a ll credit card, debit card and electronic benefits transfer transactions that process in less than seven days in the amount of $25.4 million and $26.6 million as of June 30, 2018 and December 30, 2017, respectively . Management deem s the classification of the a mounts due from third-party financial institutions to be more appropriately reported in cash and cash equivalents due to certainty and timely settlement in less than seven days . The amounts have been reclassified from accounts receivable to cash and cash equivalents as of December 30, 2017 in the amount of $ 26.6 million to conform to the presentation of the Consolidated Balance Sheets as of June 30, 2018. As of December 31, 2017 , the Company changed its policy for advertising costs to expense advertising costs as incurred, net of vendor paid cooperative advertising credits, in Cost of sales, in the amount of $2.5 million and $6.1 million for the thirteen weeks and $4.4 million and $6.9 million for the twenty-six weeks ended June 30, 2018 and July 1, 2017, respectively. Management deems that the policy change to record net advertising costs in Cost of sales instead of Operating, general and administrative expenses better represents Cost of sales inclusiv e of direct product costs (net of discounts and allowances), distribution center and transportation costs, manufacturing facility operations and advertising costs that are primarily funded by vendor cooperative advertising credits and occur in the same period the product is sold. Advertising costs net of vendor cooperative advertising credits have been reclassified to Cost of sales out of Operating, General and Administrative costs for the thirteen and twenty-six weeks ended and July 1, 2017 in the amount of $6.1 million and $6.9 million, respectively, to conform to the presentation of the Consolidated Statement of Income for the thirteen and twenty-six weeks ended June 30, 2018 . ( 7 ) Cash and Cash Equivalents and Advertising Accounting Policies (continued) The tables below summarize the effect of the reclassifications of previously reported C onsolidated F inancial S tatements for the fiscal year ended December 30, 2017 and the thirteen and twenty-six weeks ended July 1, 2017. As of December 30, 2017 As Previously Consolidated Balance Sheets (dollars in thousands) Reported Reclassifications As Adjusted Cash and Cash Equivalent $ 21,305 $ 26,612 $ 47,917 Accounts Receivable, net 82,877 (26,612) 56,265 July 1, 2017 13 Weeks Ended 26 Weeks Ended Consolidated Statements of Income As Previously As Previously (dollars in thousands) Reported Reclassifications As Adjusted Reported Reclassifications As Adjusted Cost of sales, including advertising, warehousing and distribution expenses $ 636,690 $ 6,121 $ 642,811 $ 1,259,123 $ 6,881 $ 1,266,004 Gross profit on sales 239,879 (6,121) 233,758 469,675 (6,881) 462,794 Operating, general and administrative expenses 212,161 (6,121) 206,040 421,707 (6,881) 414,826 26 Weeks Ended July 1, 2017 Consolidated Statements of Cash Flows As Previously (dollars in thousands) Reported Reclassifications As Adjusted Accounts receivable and prepaid expenses $ 21,429 $ (6,058) $ 15,371 Net cash provided by operating activities 69,320 (6,058) 63,262 Net increase (decreases) in cash and cash equivalents 2,929 (6,058) (3,129) Cash and cash equivalents at beginning of year 14,653 32,165 46,818 Cash and cash equivalents at end of period $ 17,582 $ 26,107 $ 43,689 |
Income Taxes
Income Taxes | 6 Months Ended |
Jun. 30, 2018 | |
Income Taxes [Abstract] | |
Income Taxes | (8 ) Income Taxes The Company reflected the effects of the Tax Cuts and Jobs Act (The Act), in its 2017 financial statements. This included the effects of the change in the US Corporate tax rate from 35% to 21% on deferred tax assets and liabilities. The Company’s tax expense for the period ended June 30, 2018 includes the reduction in the U.S. federal tax rate from 35% to 21%, effective for the Company’s 2018 tax year. The Company’s tax provision also reflects other changes as a result of the Act, including the impact of changes effecting the deductibility of certain executive compensation and immediate expensing of qualified assets placed into service after September 27, 2017. |
Significant Accounting Polici17
Significant Accounting Policies (Policy) | 6 Months Ended |
Jun. 30, 2018 | |
Significant Accounting Policies [Abstract] | |
Basis of Presentation | Basis of Presentation: The accompanying unaudited Consolidated Financial Statements have been prepared in accordance with accounting principles generally accepted in the United States for interim financial information and with the instructions for Form 10-Q and Article 10 of Regulation S-X. In the opinion of management, all adjustments (consisting of normal recurring deferrals and accruals) considered necessary for a fair presentation have been included. The operating results for the periods presented are not necessarily indicative of the results to be expected for the full year. The Company has evaluated subsequent events for disclosure through the date of issuance of the accompanying unaudited consolidated interim financial statements and there were no material subsequent events which require additional disclosure. For further information, refer to the Consolidated Financial Statements and footnotes thereto included in the Company's latest Annual Report on Form 10-K. As of December 31, 2017, the Company changed its accounting policy for cash and cash equivalents and advertising costs. See Note 7 Cash and Cash Equivalents and Advertising Accounting Policies. |
Current Relevant Accounting S18
Current Relevant Accounting Standards (Policy) | 6 Months Ended |
Jun. 30, 2018 | |
Current Relevant Accounting Standards [Abstract] | |
Current Relevant Accounting Standards | In May 2014, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) 2014-09, Revenue from Contracts with Customers (Topic 606) , as amended by several subsequent ASU’s, which establishes principles for recognizing revenue upon the transfer of promised goods or services to customers, in an amount that reflects the expected consideration received in exchange for those goods or services. In August 2015, the FASB issued a one-year deferral of the effective date of this new guidance resulting in it now being effective for the Company beginning in fiscal year 2018. The Company has evaluated the impact of adoption of the ASU. The Company’s assessment of the new guidance has identified customer loyalty programs and gift cards affected by the new guidance. The Company adopted the new standard using the modified retrospective method beginning December 31, 2017. T he effects related to these transactions did not materially effect the Company’s Co nsolidated Financial Statements. The Company determined that the adoption of the ASU did not have a significant impact on the Company’s point of sale product sales. In January 2016, the FASB issued ASU 2016-01 Financial Instruments – Overall (Subtopic 825-10): Recognition and Measurement of Financial Assets and Financial Liabilities . ASU 2016-01 generally requires that equity investments (excluding equity method investments) be measured at fair value with changes in fair value recognized in net income. The adoption of ASU 2016-01 had an impact on the net income reported in the Company’s Consolidated Statements of Income in the amount of $0.5 million and $1.2 million for the second quarter and the first twenty-six weeks of 2018, respectively. The ASU was adopted as of December 31, 2017. The cumulative effect of the adoption was made to the balance sheet as of December 31, 2017 and resulted in a reclassification of $5.5 million of related accumulated unrealized gains , net of applicable deferred income taxes, that were included in accumulated other comprehensive income to retained earnings, resulting in no impact on the Company’s shareholders’ equity. In February 2016, the FASB issued ASU 2016-02 Lea ses (Topic 842). ASU 2016-02 requires lessees to recognize assets and liabilities for the rights and obligations created by their leases with lease terms more than 12 months. ASU 2016-02 will become effective for annual periods beginning after December 15, 2018 and for interim periods within those fiscal years. The Company is currently in the process of evaluating the impact of adoption of the ASU and expects the adoption to have a significant impact on the Company’s Consolidated Balance Sheets . In March 2016, the FASB issued ASU 2016-04 Liabilities – Extinguishments of Liabilities (Subtopic 405-20) Recognition of Breakage for Certain Prepaid Stored-Value Products . ASU 2016-04 requires that an entity must disclose the methodology and specific judgements made in applying the breakage recognized. ASU 2016-04 will become effective for the financial statements issued for the fiscal years beginning after December 15, 2017. The Company has evaluated the effect of the adoption of the ASU and determined there was not a significant impact on the Company’s Consolidated Financial Statements. The Company adopted ASU 2016-04 beginning December 31, 2017 . |
Marketable Securities (Tables)
Marketable Securities (Tables) | 6 Months Ended |
Jun. 30, 2018 | |
Marketable Securities [Abstract] | |
Schedule Of Marketable Securities | Mar ketable securities, as of June 30, 2018 and December 30, 2017 , consisted of: Gross Gross (dollars in thousands) Amortized Unrealized Unrealized Fair June 30, 2018 Cost Holding Gains Holding Losses Value Available-for-sale: Level 1 Equity securities $ 1,198 $ 6,396 $ - $ 7,594 Level 2 Municipal bonds 51,161 274 (295) 51,140 $ 52,359 $ 6,670 $ (295) $ 58,734 Gross Gross (dollars in thousands) Amortized Unrealized Unrealized Fair December 30, 2017 Cost Holding Gains Holding Losses Value Available-for-sale: Level 1 Equity securities $ 1,198 $ 7,634 $ - $ 8,832 Level 2 Municipal bonds 54,278 671 (116) 54,833 $ 55,476 $ 8,305 $ (116) $ 63,665 |
Schedule Of Maturities Of Marketable Securities | Maturities of marketable securities classified as available-for-sale at June 30, 2018 , were as follows: Amortized Fair (dollars in thousands) Cost Value Available-for-sale: Due within one year $ 11,960 $ 11,973 Due after one year through five years 22,477 22,583 Due after five years through ten years 16,724 16,584 Equity securities 1,198 7,594 $ 52,359 $ 58,734 |
Accumulated Other Comprehensi20
Accumulated Other Comprehensive Income (Tables) | 6 Months Ended |
Jun. 30, 2018 | |
Accumulated Other Comprehensive Income [Abstract] | |
Schedule of Accumulated Other Comprehensive Income | Unrealized Gains on Available-for-Sale (dollars in thousands) Marketable Securities Accumulated other comprehensive income balance as of December 30, 2017 $ 5,880 Amount reclassified to retained earnings for equity unrealized gain (adoption of ASU 2016-01) (5,482) Other comprehensive loss before reclassifications (445) Amounts reclassified from accumulated other comprehensive income 39 Net current period change in other comprehensive income (5,888) Accumulated other comprehensive income balance as of June 30, 2018 $ (8) |
Schedule Of Reclassifications out of Accumulated Other Comprehensive Income | Amounts Reclassified from Accumulated Other Comprehensive Income to the Consolidated Statements of Income 13 Weeks Ended 26 Weeks Ended (dollars in thousands) Location June 30, 2018 July 1, 2017 June 30, 2018 July 1, 2017 Unrealized gains (losses) on available-for-sale marketable securities Investment income and interest expense $ - $ - $ 54 $ - Provision for income taxes - - (15) - Total amount reclassified, net of tax $ - $ - $ 39 $ - |
Revenue Recognition (Tables)
Revenue Recognition (Tables) | 6 Months Ended |
Jun. 30, 2018 | |
Revenue Recognition [Abstract] | |
Schedule Of Sales By Type Of Product | 13 Weeks Ended ( dollars in thousands ) June 30, 2018 July 1, 2017 Grocery $ 757,894 87.0 % $ 768,824 87.6 % Pharmacy 78,271 9.0 78,573 9.0 Fuel 33,439 3.8 27,830 3.2 Manufacturing 1,496 0.2 1,342 0.2 Total net sales $ 871,100 100.0 % $ 876,569 100.0 % 26 Weeks Ended ( dollars in thousands ) June 30, 2018 July 1, 2017 Grocery $ 1,525,912 87.3 % $ 1,518,386 87.8 % Pharmacy 156,211 8.9 154,823 9.0 Fuel 62,084 3.6 52,280 3.0 Manufacturing 2,999 0.2 3,309 0.2 Total net sales $ 1,747,206 100.0 % $ 1,728,798 100.0 % |
Cash And Cash Equivalents And22
Cash And Cash Equivalents And Advertising Accounting Policies (Tables) | 6 Months Ended |
Jun. 30, 2018 | |
Cash And Cash Equivalents And Advertising Accounting Policies [Abstract] | |
Effect Of Reclassification Of Financial Statements | As of December 30, 2017 As Previously Consolidated Balance Sheets (dollars in thousands) Reported Reclassifications As Adjusted Cash and Cash Equivalent $ 21,305 $ 26,612 $ 47,917 Accounts Receivable, net 82,877 (26,612) 56,265 July 1, 2017 13 Weeks Ended 26 Weeks Ended Consolidated Statements of Income As Previously As Previously (dollars in thousands) Reported Reclassifications As Adjusted Reported Reclassifications As Adjusted Cost of sales, including advertising, warehousing and distribution expenses $ 636,690 $ 6,121 $ 642,811 $ 1,259,123 $ 6,881 $ 1,266,004 Gross profit on sales 239,879 (6,121) 233,758 469,675 (6,881) 462,794 Operating, general and administrative expenses 212,161 (6,121) 206,040 421,707 (6,881) 414,826 26 Weeks Ended July 1, 2017 Consolidated Statements of Cash Flows As Previously (dollars in thousands) Reported Reclassifications As Adjusted Accounts receivable and prepaid expenses $ 21,429 $ (6,058) $ 15,371 Net cash provided by operating activities 69,320 (6,058) 63,262 Net increase (decreases) in cash and cash equivalents 2,929 (6,058) (3,129) Cash and cash equivalents at beginning of year 14,653 32,165 46,818 Cash and cash equivalents at end of period $ 17,582 $ 26,107 $ 43,689 |
Current Relevant Accounting S23
Current Relevant Accounting Standards (Narrative) (Details) - Accounting Standards Update 2016-01 [Member] - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | |
Jun. 30, 2018 | Jun. 30, 2018 | Dec. 30, 2017 | |
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||
Impact on net income | $ 0.5 | $ 1.2 | |
Impact on retained earnings | $ 5.5 |
Marketable Securities (Narrativ
Marketable Securities (Narrative) (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2018 | Jul. 01, 2017 | Jun. 30, 2018 | Jul. 01, 2017 | |
Marketable Securities [Abstract] | ||||
Investment income | $ 178 | $ 672 | $ (187) | $ 1,800 |
Unrealized loss on equity securities | $ 459 | $ 1,200 |
Marketable Securities (Schedule
Marketable Securities (Schedule Of Marketable Securities) (Details) - USD ($) $ in Thousands | Jun. 30, 2018 | Dec. 30, 2017 |
Schedule of Available-for-sale Securities [Line Items] | ||
Amortized Cost | $ 52,359 | $ 55,476 |
Gross Unrealized Holding Gains | 6,670 | 8,305 |
Gross Unrealized Holding Losses | (295) | (116) |
Fair Value | 58,734 | 63,665 |
Equity Securities [Member] | Fair Value, Inputs, Level 1 [Member] | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Amortized Cost | 1,198 | 1,198 |
Gross Unrealized Holding Gains | 6,396 | 7,634 |
Gross Unrealized Holding Losses | 0 | 0 |
Fair Value | 7,594 | 8,832 |
Municipal Bonds [Member] | Fair Value, Inputs, Level 2 [Member] | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Amortized Cost | 51,161 | 54,278 |
Gross Unrealized Holding Gains | 274 | 671 |
Gross Unrealized Holding Losses | (295) | (116) |
Fair Value | $ 51,140 | $ 54,833 |
Marketable Securities (Schedu26
Marketable Securities (Schedule Of Maturities of Marketable Securities) (Details) - USD ($) $ in Thousands | Jun. 30, 2018 | Dec. 30, 2017 |
Marketable Securities [Abstract] | ||
Amortized Cost, Due within one year | $ 11,960 | |
Fair Value, Due within one year | 11,973 | |
Amortized Cost, Due after one year through five years | 22,477 | |
Fair Value, Due after one year through five years | 22,583 | |
Amortized Cost, Due after five years through ten years | 16,724 | |
Fair Value, Due after five years through ten years | 16,584 | |
Amortized Cost, Equity securities | 1,198 | |
Fair Value, Equity securities | 7,594 | |
Amortized Cost | 52,359 | $ 55,476 |
Available-for-sale Securities, Fair Value, Total | $ 58,734 | $ 63,665 |
Accumulated Other Comprehensi27
Accumulated Other Comprehensive Income (Schedule Of Accumulated Other Comprehensive Income) (Details) - Unrealized Gain On Available-For-Sale Marketable Securities [Member] $ in Thousands | 6 Months Ended |
Jun. 30, 2018USD ($) | |
Accumulated Other Comprehensive Income (Loss) [Line Items] | |
Accumulated other comprehensive income balance, beginning balance | $ 5,880 |
Amount reclassified to retained earnings for equity unrealized gain (adoption of ASU 2016-01) | (5,482) |
Other comprehensive loss before reclassifications | (445) |
Amounts reclassified from accumulated other comprehensive income | 39 |
Net current period change in other comprehensive income | (5,888) |
Accumulated other comprehensive income balance, ending balance | $ (8) |
Accumulated Other Comprehensi28
Accumulated Other Comprehensive Income (Schedule Of Reclassifications out of Accumulated Other Comprehensive Income) (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2018 | Jul. 01, 2017 | Jun. 30, 2018 | Jul. 01, 2017 | |
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | ||||
Investment income and interest expense | $ 105 | $ 412 | $ (427) | $ 1,236 |
Provision for income taxes | (7,047) | (9,655) | (13,163) | (18,893) |
Net income | 19,095 | 18,475 | 35,286 | 30,311 |
Unrealized Gain On Available-For-Sale Marketable Securities [Member] | Reclassification Out Of Accumulated Other Comprehensive Income [Member] | ||||
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | ||||
Investment income and interest expense | 54 | |||
Provision for income taxes | (15) | |||
Net income | $ 39 |
Long-Term Debt (Narrative) (Det
Long-Term Debt (Narrative) (Details) - USD ($) | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2018 | Jul. 01, 2017 | Jun. 30, 2018 | Jul. 01, 2017 | Sep. 01, 2016 | |
Line of Credit Facility [Line Items] | |||||
Letters of Credit Outstanding, Amount | $ 14,400,000 | $ 14,400,000 | |||
Interest Expense, Debt | $ 73,000 | $ 260,000 | $ 240,000 | $ 533,000 | |
Revolving Credit Facility [Member] | Wells Fargo Bank, N.A. [Member] | |||||
Line of Credit Facility [Line Items] | |||||
Line of Credit Facility, Maximum Borrowing Capacity | $ 100,000,000 | ||||
Debt Instrument, Maturity Date | Sep. 1, 2019 | ||||
Debt Instrument, Covenant, Minimum EBITDA | $ 75,000,000 | ||||
Debt Instrument, Covenant Description | The only financial covenant in the credit facility requires the Company's trailing twelve month EBITDA to be at least $75.0 million | ||||
Revolving Credit Facility [Member] | Wells Fargo Bank, N.A. [Member] | London Interbank Offered Rate (LIBOR) [Member] | |||||
Line of Credit Facility [Line Items] | |||||
Debt Instrument, Basis Spread on Variable Rate | 0.65% | ||||
Line of Credit [Member] | Wells Fargo Bank, N.A. [Member] | |||||
Line of Credit Facility [Line Items] | |||||
Line of Credit Facility, Maximum Borrowing Capacity | $ 50,000,000 |
Revenue Recognition (Schedule O
Revenue Recognition (Schedule Of Sales By Type Of Product) (Details) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2018USD ($) | Jul. 01, 2017USD ($) | Jun. 30, 2018USD ($)segment | Jul. 01, 2017USD ($) | |
Disaggregation of Revenue [Line Items] | ||||
Number of reportable segments | segment | 1 | |||
Total net sales | $ 871,100 | $ 876,569 | $ 1,747,206 | $ 1,728,798 |
Sales Revenue, Net [Member] | Product Concentration Risk [Member] | ||||
Disaggregation of Revenue [Line Items] | ||||
Concentration percent | 100.00% | 100.00% | 100.00% | 100.00% |
Grocery [Member] | ||||
Disaggregation of Revenue [Line Items] | ||||
Total net sales | $ 757,894 | $ 768,824 | $ 1,525,912 | $ 1,518,386 |
Grocery [Member] | Sales Revenue, Net [Member] | Product Concentration Risk [Member] | ||||
Disaggregation of Revenue [Line Items] | ||||
Concentration percent | 87.00% | 87.60% | 87.30% | 87.80% |
Pharmacy [Member] | ||||
Disaggregation of Revenue [Line Items] | ||||
Total net sales | $ 78,271 | $ 78,573 | $ 156,211 | $ 154,823 |
Pharmacy [Member] | Sales Revenue, Net [Member] | Product Concentration Risk [Member] | ||||
Disaggregation of Revenue [Line Items] | ||||
Concentration percent | 9.00% | 9.00% | 8.90% | 9.00% |
Fuel [Member] | ||||
Disaggregation of Revenue [Line Items] | ||||
Total net sales | $ 33,439 | $ 27,830 | $ 62,084 | $ 52,280 |
Fuel [Member] | Sales Revenue, Net [Member] | Product Concentration Risk [Member] | ||||
Disaggregation of Revenue [Line Items] | ||||
Concentration percent | 3.80% | 3.20% | 3.60% | 3.00% |
Manufacturing [Member] | ||||
Disaggregation of Revenue [Line Items] | ||||
Total net sales | $ 1,496 | $ 1,342 | $ 2,999 | $ 3,309 |
Manufacturing [Member] | Sales Revenue, Net [Member] | Product Concentration Risk [Member] | ||||
Disaggregation of Revenue [Line Items] | ||||
Concentration percent | 0.20% | 0.20% | 0.20% | 0.20% |
Cash And Cash Equivalents And31
Cash And Cash Equivalents And Advertising Accounting Policies (Narrative) (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||||
Jun. 30, 2018 | Jul. 01, 2017 | Jun. 30, 2018 | Jul. 01, 2017 | Dec. 30, 2017 | Dec. 31, 2016 | |
Cash and Cash Equivalents [Line Items] | ||||||
Cash and cash equivalents | $ 34,623 | $ 43,689 | $ 34,623 | $ 43,689 | $ 47,917 | $ 46,818 |
Accounts receivable, net | 52,835 | 52,835 | 56,265 | |||
Advertising Expense | 2,500 | 6,100 | 4,400 | 6,900 | ||
Cost of sales, including advertising, warehousing and distribution expenses | 630,805 | 642,811 | 1,272,004 | 1,266,004 | ||
Credit Card Receivable [Member] | ||||||
Cash and Cash Equivalents [Line Items] | ||||||
Accounts receivable, net | $ 25,400 | $ 25,400 | 26,600 | |||
Reclassifications [Member] | ||||||
Cash and Cash Equivalents [Line Items] | ||||||
Cash and cash equivalents | 26,107 | 26,107 | 26,612 | $ 32,165 | ||
Accounts receivable, net | $ (26,612) | |||||
Cost of sales, including advertising, warehousing and distribution expenses | $ 6,121 | $ 6,881 |
Cash And Cash Equivalents And32
Cash And Cash Equivalents And Advertising Accounting Policies (Effect Of Reclassification Of Consolidated Balance Sheets) (Details) - USD ($) $ in Thousands | Jun. 30, 2018 | Dec. 30, 2017 | Jul. 01, 2017 | Dec. 31, 2016 |
Cash and cash equivalents | $ 34,623 | $ 47,917 | $ 43,689 | $ 46,818 |
Accounts receivable, net | $ 52,835 | 56,265 | ||
As Previously Reported [Member] | ||||
Cash and cash equivalents | 21,305 | 17,582 | 14,653 | |
Accounts receivable, net | 82,877 | |||
Reclassifications [Member] | ||||
Cash and cash equivalents | 26,612 | $ 26,107 | $ 32,165 | |
Accounts receivable, net | $ (26,612) |
Cash And Cash Equivalents And33
Cash And Cash Equivalents And Advertising Accounting Policies (Effect Of Reclassification Of Consolidated Statements Of Income) (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2018 | Jul. 01, 2017 | Jun. 30, 2018 | Jul. 01, 2017 | |
Cost of sales, including advertising, warehousing and distribution expenses | $ 630,805 | $ 642,811 | $ 1,272,004 | $ 1,266,004 |
Gross profit on sales | 240,295 | 233,758 | 475,202 | 462,794 |
Operating, general and administrative expenses | $ 214,258 | 206,040 | $ 426,326 | 414,826 |
As Previously Reported [Member] | ||||
Cost of sales, including advertising, warehousing and distribution expenses | 636,690 | 1,259,123 | ||
Gross profit on sales | 239,879 | 469,675 | ||
Operating, general and administrative expenses | 212,161 | 421,707 | ||
Reclassifications [Member] | ||||
Cost of sales, including advertising, warehousing and distribution expenses | 6,121 | 6,881 | ||
Gross profit on sales | (6,121) | (6,881) | ||
Operating, general and administrative expenses | $ (6,121) | $ (6,881) |
Cash And Cash Equivalents And34
Cash And Cash Equivalents And Advertising Accounting Policies (Effect Of Reclassification Of Consolidated Statements Of Cash Flows) (Details) - USD ($) $ in Thousands | 6 Months Ended | |
Jun. 30, 2018 | Jul. 01, 2017 | |
Accounts receivable and prepaid expenses | $ 5,436 | $ 15,371 |
Net cash provided by operating activities | 84,227 | 63,262 |
Net increase (decreases) in cash and cash equivalents | (13,294) | (3,129) |
Cash and cash equivalents at beginning of year | 47,917 | 46,818 |
Cash and cash equivalents at end of period | 34,623 | 43,689 |
As Previously Reported [Member] | ||
Accounts receivable and prepaid expenses | 21,429 | |
Net cash provided by operating activities | 69,320 | |
Net increase (decreases) in cash and cash equivalents | 2,929 | |
Cash and cash equivalents at beginning of year | 21,305 | 14,653 |
Cash and cash equivalents at end of period | 17,582 | |
Reclassifications [Member] | ||
Accounts receivable and prepaid expenses | (6,058) | |
Net cash provided by operating activities | (6,058) | |
Net increase (decreases) in cash and cash equivalents | (6,058) | |
Cash and cash equivalents at beginning of year | $ 26,612 | 32,165 |
Cash and cash equivalents at end of period | $ 26,107 |
Income Taxes (Narrative) (Detai
Income Taxes (Narrative) (Details) | 6 Months Ended | 12 Months Ended |
Jun. 30, 2018 | Dec. 30, 2017 | |
Income Taxes [Abstract] | ||
Federal tax rate | 21.00% | 35.00% |