DOCUMENT AND ENTITY INFORMATION
DOCUMENT AND ENTITY INFORMATION - USD ($) | 12 Months Ended | ||
Dec. 31, 2017 | Feb. 16, 2018 | Jun. 30, 2017 | |
Document Information [Line Items] | |||
Entity registrant name | HERSHEY CO | ||
Entity central index key | 47,111 | ||
Current fiscal year end date | --12-31 | ||
Entity filer category | Large Accelerated Filer | ||
Document type | 10-K | ||
Document period end date | Dec. 31, 2017 | ||
Document fiscal year focus | 2,017 | ||
Document fiscal period focus | FY | ||
Amendment flag | false | ||
Entity well-known seasoned issuer | Yes | ||
Entity voluntary filers | No | ||
Entity current reporting status | Yes | ||
Entity public float | $ 14,885,931,198 | ||
Common stock | |||
Document Information [Line Items] | |||
Entity common stock, shares outstanding (shares) | 149,863,997 | ||
Class B common stock | |||
Document Information [Line Items] | |||
Entity common stock, shares outstanding (shares) | 60,619,777 |
CONSOLIDATED STATEMENTS OF INCO
CONSOLIDATED STATEMENTS OF INCOME - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Net sales | $ 7,515,426 | $ 7,440,181 | $ 7,386,626 |
Cost of sales | 4,070,907 | 4,282,290 | 4,003,951 |
Gross profit | 3,444,519 | 3,157,891 | 3,382,675 |
Selling, marketing and administrative expense | 1,913,403 | 1,915,378 | 1,969,308 |
Long-lived asset impairment charges | 208,712 | 0 | 0 |
Goodwill and indefinite-lived intangible asset impairment charges | 0 | 4,204 | 280,802 |
Business realignment costs | 47,763 | 32,526 | 94,806 |
Operating profit | 1,274,641 | 1,205,783 | 1,037,759 |
Interest expense, net | 98,282 | 90,143 | 105,773 |
Other (income) expense, net | 65,691 | 16,159 | 30,139 |
Income before income taxes | 1,110,668 | 1,099,481 | 901,847 |
Provision for income taxes | 354,131 | 379,437 | 388,896 |
Net income including noncontrolling interest | 756,537 | 720,044 | 512,951 |
Net income (loss) attributable to noncontrolling interests | (26,444) | 0 | 0 |
Net income attributable to The Hershey Company | $ 782,981 | $ 720,044 | $ 512,951 |
Common stock | |||
Net income per share—basic: | |||
Net income per share - basic (USD per share) | $ 3.79 | $ 3.45 | $ 2.40 |
Net income per share—diluted: | |||
Net income per share - diluted (USD per share) | 3.66 | 3.34 | 2.32 |
Dividends paid per share: | |||
Dividends paid per share (USD per share) | 2.548 | 2.402 | 2.236 |
Class B common stock | |||
Net income per share—basic: | |||
Net income per share - basic (USD per share) | 3.44 | 3.15 | 2.19 |
Net income per share—diluted: | |||
Net income per share - diluted (USD per share) | 3.44 | 3.14 | 2.19 |
Dividends paid per share: | |||
Dividends paid per share (USD per share) | $ 2.316 | $ 2.184 | $ 2.032 |
CONSOLIDATED STATEMENTS OF COMP
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Statement of Comprehensive Income [Abstract] | |||
Net income including noncontrolling interest | $ 756,537 | $ 720,044 | $ 512,951 |
Other comprehensive income (loss), net of tax: | |||
Foreign currency translation adjustments, pre-tax amount | 19,616 | (13,041) | (59,707) |
Foreign currency translation adjustments, tax (expense) benefit | 0 | 0 | 0 |
Foreign currency translation adjustments, after-tax amount | 19,616 | (13,041) | (59,707) |
Pension and post-retirement benefit plans: | |||
Net actuarial gain (loss) and prior service cost, pre-tax amount | 28,718 | 20,304 | (5,559) |
Net actuarial gain (loss) and prior service cost, tax (expense) benefit | (10,883) | (7,776) | 2,002 |
Net actuarial gain (loss) and prior service cost, after-tax amount | 17,835 | 12,528 | (3,557) |
Reclassification to earnings, pre-tax amount | 46,305 | 56,604 | 52,469 |
Reclassification to earnings, tax (expense) benefit | (26,497) | (21,653) | (18,910) |
Reclassification to earnings, after-tax amount | 19,808 | 34,951 | 33,559 |
Cash flow hedges: | |||
Gains (losses) on cash flow hedging derivatives, pre-tax amount | (4,931) | (52,708) | 61,839 |
Gains (losses) on cash flow hedging derivatives, tax (expense) benefit | 73 | 18,701 | (23,520) |
Gains (losses) on cash flow hedging derivatives, after-tax amount | (4,858) | (34,007) | 38,319 |
Reclassification to earnings, pre-tax amount | 14,434 | (16,482) | (36,634) |
Reclassification to earnings, tax (expense) benefit | (3,853) | 7,524 | 13,416 |
Reclassification to earnings, after-tax amount | 10,581 | (8,958) | (23,218) |
Total other comprehensive income (loss), pre-tax amount | 104,142 | (5,323) | 12,408 |
Total other comprehensive income (loss), tax (expense) benefit | (41,160) | (3,204) | (27,012) |
Total other comprehensive income (loss), after-tax amount | 62,982 | (8,527) | (14,604) |
Total comprehensive income including noncontrolling interest | 819,519 | 711,517 | 498,347 |
Comprehensive loss attributable to noncontrolling interest | (25,604) | (3,664) | (2,152) |
Comprehensive income attributable to The Hershey Company | $ 845,123 | $ 715,181 | $ 500,499 |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 31, 2016 |
Current assets: | ||
Cash and cash equivalents | $ 380,179 | $ 296,967 |
Accounts receivable—trade, net | 588,262 | 581,381 |
Inventories | 752,836 | 745,678 |
Prepaid expenses and other | 280,633 | 192,752 |
Total current assets | 2,001,910 | 1,816,778 |
Property, plant and equipment, net | 2,106,697 | 2,177,248 |
Goodwill | 821,061 | 812,344 |
Other intangibles | 369,156 | 492,737 |
Other assets | 251,879 | 168,365 |
Deferred income taxes | 3,023 | 56,861 |
Total assets | 5,553,726 | 5,524,333 |
Current liabilities: | ||
Accounts payable | 523,229 | 522,536 |
Accrued liabilities | 676,134 | 750,986 |
Accrued income taxes | 17,723 | 3,207 |
Short-term debt | 559,359 | 632,471 |
Current portion of long-term debt | 300,098 | 243 |
Total current liabilities | 2,076,543 | 1,909,443 |
Long-term debt | 2,061,023 | 2,347,455 |
Other long-term liabilities | 438,939 | 400,161 |
Deferred income taxes | 45,656 | 39,587 |
Total liabilities | 4,622,161 | 4,696,646 |
Stockholders’ equity: | ||
Preferred stock, shares issued: none in 2017 and 2016 | 0 | 0 |
Additional paid-in capital | 924,978 | 869,857 |
Retained earnings | 6,371,082 | 6,115,961 |
Treasury—common stock shares, at cost: 149,040,927 in 2017 and 147,642,009 in 2016 | (6,426,877) | (6,183,975) |
Accumulated other comprehensive loss | (313,746) | (375,888) |
Total—The Hershey Company stockholders’ equity | 915,338 | 785,856 |
Noncontrolling interest in subsidiary | 16,227 | 41,831 |
Total stockholders’ equity | 931,565 | 827,687 |
Total liabilities and stockholders’ equity | 5,553,726 | 5,524,333 |
Common stock | ||
Stockholders’ equity: | ||
Common stock | 299,281 | 299,281 |
Class B common stock | ||
Stockholders’ equity: | ||
Common stock | $ 60,620 | $ 60,620 |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) - shares | Dec. 31, 2017 | Dec. 31, 2016 |
Preferred stock, shares issued (shares) | 0 | 0 |
Common stock, shares issued (shares) | 359,901,744 | 359,901,744 |
Treasury stock, shares (shares) | 149,040,927 | 147,642,009 |
Common stock | ||
Common stock, shares issued (shares) | 299,281,967 | 299,281,967 |
Class B common stock | ||
Common stock, shares issued (shares) | 60,619,777 | 60,619,777 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Statement of Cash Flows [Abstract] | |||
Net income including noncontrolling interest | $ 756,537 | $ 720,044 | $ 512,951 |
Adjustments to reconcile net income to net cash provided by operating activities: | |||
Depreciation and amortization | 261,853 | 301,837 | 244,928 |
Stock-based compensation expense | 51,061 | 54,785 | 51,533 |
Deferred income taxes | 18,582 | (38,097) | (38,537) |
Impairment of goodwill, indefinite and long-lived assets (see Notes 3 and 7) | 208,712 | 4,204 | 280,802 |
Loss on early extinguishment of debt (see Note 4) | 0 | 0 | 28,326 |
Write-down of equity investments | 66,209 | 43,482 | 39,489 |
Gain on settlement of SGM liability (see Note 2) | 0 | (26,650) | 0 |
Other | 77,291 | 51,375 | 28,467 |
Changes in assets and liabilities, net of business acquisitions and divestitures: | |||
Accounts receivable—trade, net | (6,881) | 21,096 | (24,440) |
Inventories | (71,404) | 13,965 | 52,049 |
Prepaid expenses and other current assets | 18,214 | (42,955) | 118,007 |
Accounts payable and accrued liabilities | (52,960) | (63,467) | 9,574 |
Accrued income taxes | (71,027) | (937) | 36,848 |
Contributions to pension and other benefit plans | (56,433) | (41,697) | (53,273) |
Other assets and liabilities | 49,761 | 16,443 | (30,413) |
Net cash provided by operating activities | 1,249,515 | 1,013,428 | 1,256,311 |
Investing Activities | |||
Capital additions (including software) | (257,675) | (269,476) | (356,810) |
Proceeds from sales of property, plant and equipment | 7,609 | 3,651 | 1,205 |
Proceeds from sale of business | 0 | 0 | 32,408 |
Equity investments in tax credit qualifying partnerships | (78,598) | (44,255) | (30,720) |
Business acquisitions, net of cash and cash equivalents acquired | 0 | (285,374) | (218,654) |
Sale of short-term investments | 0 | 0 | (95,316) |
Net cash used in investing activities | (328,664) | (595,454) | (477,255) |
Financing Activities | |||
Net (decrease) increase in short-term debt | (81,426) | 275,607 | 10,720 |
Long-term borrowings | 954 | 792,953 | 599,031 |
Repayment of long-term debt | 0 | (500,000) | (355,446) |
Payment of SGM liability (see Note 2) | 0 | (35,762) | 0 |
Cash dividends paid | (526,272) | (499,475) | (476,132) |
Repurchase of common stock | (300,312) | (592,550) | (582,623) |
Exercise of stock options | 63,288 | 94,831 | 55,703 |
Other | 0 | 0 | (48,270) |
Net cash used in financing activities | (843,768) | (464,396) | (797,017) |
Effect of exchange rate changes on cash and cash equivalents | 6,129 | (3,140) | (10,364) |
Increase (decrease) in cash and cash equivalents | 83,212 | (49,562) | (28,325) |
Cash and cash equivalents, beginning of period | 296,967 | 346,529 | 374,854 |
Cash and cash equivalents, end of period | 380,179 | 296,967 | 346,529 |
Supplemental Disclosure | |||
Interest paid (excluding loss on early extinguishment of debt in 2015) | 101,874 | 90,951 | 88,448 |
Income taxes paid | $ 351,832 | $ 425,539 | $ 368,926 |
CONSOLIDATED STATEMENTS OF STOC
CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY - USD ($) $ in Thousands | Total | Common stock | Class B common stock | Preferred Stock | Common StockCommon stock | Common StockClass B common stock | Additional Paid-in Capital | Retained Earnings | Retained EarningsCommon stock | Retained EarningsClass B common stock | Treasury Common Stock | Accumulated Other Comprehensive Income (Loss) | Noncontrolling Interests in Subsidiaries | Selling, marketing and administrative | Selling, marketing and administrativeNoncontrolling Interests in Subsidiaries |
Beginning balance, stockholders' equity at Dec. 31, 2014 | $ 1,519,530 | $ 0 | $ 299,281 | $ 60,620 | $ 754,186 | $ 5,860,784 | $ (5,161,236) | $ (358,573) | $ 64,468 | ||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||||||||||
Net income attributable to The Hershey Company | 512,951 | 512,951 | |||||||||||||
Net income (loss) attributable to noncontrolling interests | 0 | $ 577 | $ 577 | ||||||||||||
Net income including noncontrolling interest | 512,951 | ||||||||||||||
Other comprehensive income (loss) | (14,604) | (12,452) | (2,152) | ||||||||||||
Dividends: | |||||||||||||||
Common Stock | $ (352,953) | $ (123,179) | $ (352,953) | $ (123,179) | |||||||||||
Stock-based compensation | 50,722 | 50,722 | |||||||||||||
Exercise of stock options and incentive-based transactions | 79,704 | 8,204 | 71,500 | ||||||||||||
Repurchase of common stock | (582,623) | (582,623) | |||||||||||||
Impact of reclassifications to and purchase of redeemable noncontrolling interest | (42,663) | (29,235) | (13,428) | ||||||||||||
Ending balance, stockholders' equity at Dec. 31, 2015 | 1,047,462 | 0 | 299,281 | 60,620 | 783,877 | 5,897,603 | (5,672,359) | (371,025) | 49,465 | ||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||||||||||
Net income attributable to The Hershey Company | 720,044 | 720,044 | |||||||||||||
Net income (loss) attributable to noncontrolling interests | 0 | $ (3,970) | $ (3,970) | ||||||||||||
Net income including noncontrolling interest | 720,044 | ||||||||||||||
Other comprehensive income (loss) | (8,527) | (4,863) | (3,664) | ||||||||||||
Dividends: | |||||||||||||||
Common Stock | (369,292) | (132,394) | (369,292) | (132,394) | |||||||||||
Stock-based compensation | 54,429 | 54,429 | |||||||||||||
Exercise of stock options and incentive-based transactions | 112,485 | 31,551 | 80,934 | ||||||||||||
Repurchase of common stock | (592,550) | (592,550) | |||||||||||||
Ending balance, stockholders' equity at Dec. 31, 2016 | 827,687 | 0 | 299,281 | 60,620 | 869,857 | 6,115,961 | (6,183,975) | (375,888) | 41,831 | ||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||||||||||
Net income attributable to The Hershey Company | 782,981 | 782,981 | |||||||||||||
Net income (loss) attributable to noncontrolling interests | (26,444) | (26,444) | |||||||||||||
Net income including noncontrolling interest | 756,537 | ||||||||||||||
Other comprehensive income (loss) | 62,982 | 62,142 | 840 | ||||||||||||
Dividends: | |||||||||||||||
Common Stock | $ (387,466) | $ (140,394) | $ (387,466) | $ (140,394) | |||||||||||
Stock-based compensation | 49,243 | 49,243 | |||||||||||||
Exercise of stock options and incentive-based transactions | 63,288 | 5,878 | 57,410 | ||||||||||||
Repurchase of common stock | (300,312) | (300,312) | |||||||||||||
Ending balance, stockholders' equity at Dec. 31, 2017 | $ 931,565 | $ 0 | $ 299,281 | $ 60,620 | $ 924,978 | $ 6,371,082 | $ (6,426,877) | $ (313,746) | $ 16,227 |
CONSOLIDATED STATEMENTS OF STO8
CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY (Parenthetical) - $ / shares | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2017 | Oct. 01, 2017 | Jul. 02, 2017 | Apr. 02, 2017 | Dec. 31, 2016 | Oct. 02, 2016 | Jul. 03, 2016 | Apr. 03, 2016 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Common stock | |||||||||||
Dividends paid per share (USD per share) | $ 0.656 | $ 0.656 | $ 0.618 | $ 0.618 | $ 0.618 | $ 0.618 | $ 0.583 | $ 0.583 | $ 2.548 | $ 2.402 | $ 2.236 |
Class B common stock | |||||||||||
Dividends paid per share (USD per share) | $ 0.596 | $ 0.596 | $ 0.562 | $ 0.562 | $ 0.562 | $ 0.562 | $ 0.530 | $ 0.530 | $ 2.316 | $ 2.184 | $ 2.032 |
SUMMARY OF SIGNIFICANT ACCOUNTI
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 12 Months Ended |
Dec. 31, 2017 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Description of Business The Hershey Company together with its wholly-owned subsidiaries and entities in which it has a controlling interest,(the “Company,” “Hershey,” “we” or “us”) is a global confectionery leader known for its branded portfolio of chocolate, sweets, mints and other great-tasting snacks. The Company has more than 80 brands worldwide including such iconic brand names as Hershey’s, Reese’s, Kisses, Jolly Rancher and Ice Breakers, which are marketed, sold and distributed in approximately 80 countries worldwide. Hershey is focused on growing its presence in key international markets while continuing to build its competitive advantage in North America. The Company currently operates through two reportable segments that are aligned with its management structure and the key markets it serves: North America and International and Other. For additional information on our segment presentation, see Note 11. Basis of Presentation Our consolidated financial statements include the accounts of The Hershey Company and its majority-owned or controlled subsidiaries. Intercompany transactions and balances have been eliminated. We have a controlling financial interest if we own a majority of the outstanding voting common stock and minority shareholders do not have substantive participating rights, we have significant control through contractual or economic interests in which we are the primary beneficiary or we have the power to direct the activities that most significantly impact the entity's economic performance. Net income (loss) attributable to noncontrolling interests in 2016 and 2015 was not considered significant and was recorded within selling, marketing and administrative expense in the Consolidated Statements of Income. See Note 12 for additional information on our noncontrolling interest. We use the equity method of accounting when we have a 20% to 50% interest in other companies and exercise significant influence. In addition, we use the equity method of accounting for our investments in partnership entities which make equity investments in projects eligible to receive federal historic and energy tax credits. See Note 8 for additional information on our equity investments in partnership entities qualifying for tax credits. Use of Estimates The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America (“GAAP”) requires management to make estimates and assumptions that affect the amounts reported in the consolidated financial statements and accompanying disclosures. Our significant estimates and assumptions include, among others, pension and other post-retirement benefit plan assumptions, valuation assumptions of goodwill and other intangible assets, useful lives of long-lived assets, marketing and trade promotion accruals and income taxes. These estimates and assumptions are based on management’s best judgment. Management evaluates its estimates and assumptions on an ongoing basis using historical experience and other factors, including the current economic environment, and the effects of any revisions are reflected in the consolidated financial statements in the period that they are determined. As future events and their effects cannot be determined with precision, actual results could differ significantly from these estimates. Revenue Recognition We record sales when all of the following criteria have been met: l A valid customer order with a fixed price has been received; l The product has been delivered to the customer; l There is no further significant obligation to assist in the resale of the product; and l Collectability is reasonably assured. Net sales include revenue from the sale of finished goods and royalty income, net of allowances for trade promotions, consumer coupon programs and other sales incentives, and allowances and discounts associated with aged or potentially unsaleable products. Trade promotions and sales incentives primarily include reduced price features, merchandising displays, sales growth incentives, new item allowances and cooperative advertising. Sales, use, value-added and other excise taxes are not recognized in revenue. In 2017 , 2016 and 2015 , approximately 29% , 25% and 26% , respectively, of our consolidated net sales were made to McLane Company, Inc., one of the largest wholesale distributors in the United States to convenience stores, drug stores, wholesale clubs and mass merchandisers and the primary distributor of our products to Wal-Mart Stores, Inc. Cost of Sales Cost of sales represents costs directly related to the manufacture and distribution of our products. Primary costs include raw materials, packaging, direct labor, overhead, shipping and handling, warehousing and the depreciation of manufacturing, warehousing and distribution facilities. Manufacturing overhead and related expenses include salaries, wages, employee benefits, utilities, maintenance and property taxes. Selling, Marketing and Administrative Expense Selling, marketing and administrative expense (“SM&A”) represents costs incurred in generating revenues and in managing our business. Such costs include advertising and other marketing expenses, selling expenses, research and development, administrative and other indirect overhead costs, amortization of capitalized software and intangible assets and depreciation of administrative facilities. Research and development costs, charged to expense as incurred, totaled $45,850 in 2017 , $47,268 in 2016 and $49,281 in 2015 . Advertising expense is also charged to expense as incurred and totaled $541,293 in 2017 , $521,479 in 2016 and $561,644 in 2015 . Prepaid advertising expense was $56 and $651 as of December 31, 2017 and 2016 , respectively. Cash Equivalents Cash equivalents consist of highly liquid debt instruments, time deposits and money market funds with original maturities of three months or less. The fair value of cash and cash equivalents approximates the carrying amount. Short-term Investments Short-term investments consist of bank term deposits that have original maturity dates ranging from greater than three months to twelve months. Short-term investments are carried at cost, which approximates fair value. Accounts Receivable—Trade In the normal course of business, we extend credit to customers that satisfy pre-defined credit criteria, based upon the results of our recurring financial account reviews and our evaluation of current and projected economic conditions. Our primary concentrations of credit risk are associated with McLane Company, Inc. and Target Corporation, two customers served principally by our North America segment. As of December 31, 2017 , McLane Company, Inc. accounted for approximately 24% of our total accounts receivable. Target Corporation accounted for approximately 11% of our total accounts receivable as of December 31, 2017 . No other customer accounted for more than 10% of our year-end accounts receivable. We believe that we have little concentration of credit risk associated with the remainder of our customer base. Accounts receivable-trade in the Consolidated Balance Sheets is presented net of allowances for bad debts and anticipated discounts of $41,792 and $40,153 at December 31, 2017 and 2016 , respectively. Inventories Inventories are valued at the lower of cost or market value, adjusted for the value of inventory that is estimated to be excess, obsolete or otherwise unsaleable. As of December 31, 2017 , approximately 59% of our inventories, representing the majority of our U.S. inventories, were valued under the last-in, first-out (“LIFO”) method. The remainder of our inventories in the U.S. and inventories for our international businesses are valued at the lower of first-in, first-out (“FIFO”) cost or market. LIFO cost of inventories valued using the LIFO method was $443,492 as of December 31, 2017 and $402,919 as of December 31, 2016 . The adjustment to LIFO, as shown in Note 16, approximates the excess of replacement cost over the stated LIFO inventory value. The net impact of LIFO acquisitions and liquidations was not material to 2017 , 2016 or 2015 . Property, Plant and Equipment Property, plant and equipment is stated at cost and depreciated on a straight-line basis over the estimated useful lives of the assets, as follows: 3 to 15 years for machinery and equipment; and 25 to 40 years for buildings and related improvements. At December 31, 2017 and December 31, 2016 , property, plant and equipment includes assets under capital lease arrangements with net book values totaling $116,843 and $104,503 , respectively. Total depreciation expense for the years ended December 31, 2017 , 2016 and 2015 was $211,592 , $231,735 and $197,054 , respectively, and includes depreciation on assets recorded under capital lease arrangements. Maintenance and repairs are expensed as incurred. We capitalize applicable interest charges incurred during the construction of new facilities and production lines and amortize these costs over the assets’ estimated useful lives. We review long-lived assets for impairment whenever events or changes in circumstances indicate that the carrying amount of such assets may not be recoverable. We measure the recoverability of assets to be held and used by a comparison of the carrying amount of long-lived assets to future undiscounted net cash flows expected to be generated. If these assets are considered to be impaired, we measure impairment as the amount by which the carrying amount of the assets exceeds the fair value of the assets. We report assets held for sale or disposal at the lower of the carrying amount or fair value less cost to sell. We assess asset retirement obligations on a periodic basis and recognize the fair value of a liability for an asset retirement obligation in the period in which it is incurred if a reasonable estimate of fair value can be made. We capitalize associated asset retirement costs as part of the carrying amount of the long-lived asset. Computer Software We capitalize costs associated with software developed or obtained for internal use when both the preliminary project stage is completed and it is probable the software being developed will be completed and placed in service. Capitalized costs include only (i) external direct costs of materials and services consumed in developing or obtaining internal-use software, (ii) payroll and other related costs for employees who are directly associated with and who devote time to the internal-use software project and (iii) interest costs incurred, when material, while developing internal-use software. We cease capitalization of such costs no later than the point at which the project is substantially complete and ready for its intended purpose. The unamortized amount of capitalized software totaled $104,881 and $95,301 at December 31, 2017 and 2016 , respectively. We amortize software costs using the straight-line method over the expected life of the software, generally 3 to 7 years. Accumulated amortization of capitalized software was $296,042 and $322,807 as of December 31, 2017 and 2016 , respectively. Such amounts are recorded within other assets in the Consolidated Balance Sheets. We review the carrying value of software and development costs for impairment in accordance with our policy pertaining to the impairment of long-lived assets. Goodwill and Other Intangible Assets Goodwill and indefinite-lived intangible assets are not amortized, but are evaluated for impairment annually or more often if indicators of a potential impairment are present. Our annual impairment tests are conducted at the beginning of the fourth quarter. We test goodwill for impairment by performing either a qualitative or quantitative assessment. If we choose to perform a qualitative assessment, we evaluate economic, industry and company-specific factors in assessing the fair value of the related reporting unit. If we determine that it is more likely than not that the fair value of the reporting unit is less than its carrying value, a quantitative test is then performed. Otherwise, no further testing is required. For those reporting units tested using a quantitative approach, we compare the fair value of each reporting unit with the carrying amount of the reporting unit, including goodwill. If the estimated fair value of the reporting unit is less than the carrying amount of the reporting unit, impairment is indicated, requiring recognition of a goodwill impairment charge for the differential (up to the carrying value of goodwill). We test individual indefinite-lived intangible assets by comparing the estimated fair values with the book values of each asset. We determine the fair value of our reporting units and indefinite-lived intangible assets using an income approach. Under the income approach, we calculate the fair value of our reporting units and indefinite-lived intangible assets based on the present value of estimated future cash flows. Considerable management judgment is necessary to evaluate the impact of operating and macroeconomic changes and to estimate the future cash flows used to measure fair value. Our estimates of future cash flows consider past performance, current and anticipated market conditions and internal projections and operating plans which incorporate estimates for sales growth and profitability, and cash flows associated with taxes and capital spending. Additional assumptions include forecasted growth rates, estimated discount rates, which may be risk-adjusted for the operating market of the reporting unit, and estimated royalty rates that would be charged for comparable branded licenses. We believe such assumptions also reflect current and anticipated market conditions and are consistent with those that would be used by other marketplace participants for similar valuation purposes. Such assumptions are subject to change due to changing economic and competitive conditions. See Note 3 for additional information regarding the results of impairment tests. The cost of intangible assets with finite useful lives is amortized on a straight-line basis. Our finite-lived intangible assets consist primarily of certain trademarks, customer-related intangible assets and patents obtained through business acquisitions, which are amortized over estimated useful lives of approximately 25 years , 15 years , and 5 years , respectively. If certain events or changes in operating conditions indicate that the carrying value of these assets, or related asset groups, may not be recoverable, we perform an impairment assessment and may adjust the remaining useful lives. Currency Translation The financial statements of our foreign entities with functional currencies other than the U.S. dollar are translated into U.S. dollars, with the resulting translation adjustments recorded as a component of other comprehensive income (loss). Assets and liabilities are translated into U.S. dollars using the exchange rates in effect at the balance sheet date, while income and expense items are translated using the average exchange rates during the period. Derivative Instruments We use derivative instruments principally to offset exposure to market risks arising from changes in commodity prices, foreign currency exchange rates and interest rates. See Note 5 for additional information on our risk management strategy and the types of instruments we use. Derivative instruments are recognized on the balance sheet at their fair values. When we become party to a derivative instrument and intend to apply hedge accounting, we designate the instrument for financial reporting purposes as a cash flow or fair value hedge. The accounting for changes in fair value (gains or losses) of a derivative instrument depends on whether we have designated it and it qualified as part of a hedging relationship, as noted below: • Changes in the fair value of a derivative that is designated as a cash flow hedge are recorded in accumulated other comprehensive income (“AOCI”) to the extent effective and reclassified into earnings in the same period or periods during which the transaction hedged by that derivative also affects earnings. • Changes in the fair value of a derivative that is designated as a fair value hedge, along with the offsetting loss or gain on the hedged asset or liability that is attributable to the risk being hedged, are recorded in earnings, thereby reflecting in earnings the net extent to which the hedge is not effective in achieving offsetting changes in fair value. • Changes in the fair value of a derivative not designated as a hedging instrument are recognized in earnings in cost of sales or SM&A, consistent with the related exposure. For derivatives designated as hedges, we assess, both at the hedge's inception and on an ongoing basis, whether they are highly effective in offsetting changes in fair values or cash flows of hedged items. The ineffective portion, if any, is recorded directly in earnings. In addition, if we determine that a derivative is not highly effective as a hedge or that it has ceased to be a highly effective hedge, we discontinue hedge accounting prospectively. We do not hold or issue derivative instruments for trading or speculative purposes and are not a party to any instruments with leverage or prepayment features. Cash flows related to the derivative instruments we use to manage interest, commodity or other currency exposures are classified as operating activities. Reclassifications Certain prior period amounts have been reclassified to conform to current year presentation. Specifically, this includes amounts reclassified to conform to the current year presentation in the Consolidated Statements of Cash Flows. Recent Accounting Pronouncements Recently Adopted Accounting Pronouncements In March 2016, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2016-09, Compensation—Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting . We adopted the provisions of this ASU in the first quarter of 2017. This update principally affects the recognition of excess tax benefits and deficiencies and the cash flow classification of share-based compensation-related transactions. The requirement to recognize excess tax benefits and deficiencies as income tax expense or benefit in the income statement was applied prospectively, with a benefit of $11,745 recognized during the year ended December 31, 2017 . Additionally, within the Consolidated Statement of Cash Flows, the impact of the adoption resulted in a $24,901 increase in net cash flow from operating activities and a corresponding decrease in net cash flow from financing activities for the year ended December 31, 2017 . These classification requirements were adopted retrospectively to the Consolidated Statement of Cash Flows. As a result, for the year ended December 31, 2016 , the impact resulted in a $29,953 increase in net cash flow from operating activities and a corresponding $29,953 decrease in net cash flow from financing activities. For the year ended December 31, 2015 , the impact resulted in a $41,855 increase in net cash flow from operating activities and a corresponding $41,855 decrease in net cash flow from financing activities. In January 2017, the FASB issued ASU No. 2017-04, Intangibles-Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment . This ASU eliminated Step 2 from the goodwill impairment test, which required a hypothetical purchase price allocation. A goodwill impairment will now be the amount by which a reporting unit’s carrying value exceeds its fair value. ASU 2017-04 is effective for annual or any interim goodwill impairment tests in fiscal years beginning after December 15, 2019. Entities are permitted to adopt the standard early for interim or annual goodwill impairment tests performed on testing dates after January 1, 2017. We early-adopted the provisions of this ASU in the fourth quarter of 2017 in conjunction with our annual impairment testing. The adoption had no impact on our Consolidated Financial Statements. Recently Issued Accounting Pronouncements Not Yet Adopted In May 2014, the FASB issued ASU No. 2014-09, Revenue from Contracts with Customers , which outlines a single comprehensive model for entities to use in accounting for revenue arising from contracts with customers that supersedes most current revenue recognition guidance. This guidance requires an entity to recognize revenue when it transfers promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. The guidance also requires additional financial statement disclosures that will enable users to understand the nature, amount, timing and uncertainty of revenue and cash flows relating to customer contracts. The new standard was originally effective for us on January 1, 2017; however, in July 2015 the FASB decided to defer the effective date by one year. Early application is not permitted, but reporting entities may choose to adopt the standard as of the original effective date. The standard permits the use of either the full retrospective or modified retrospective transition method. We have concluded our assessment of the new standard and will be adopting the provisions of this ASU in the first quarter of 2018 utilizing the modified retrospective transition method. The adoption of the new standard will not have a material impact on our Consolidated Financial Statements. In February 2016, the FASB issued ASU No. 2016-02, Leases (Topic 842). This ASU will require lessees to recognize a right-of-use asset and lease liability for all leases with terms of more than 12 months. Recognition, measurement and presentation of expenses will depend on classification as a finance or operating lease. This ASU also requires certain quantitative and qualitative disclosures. Accounting guidance for lessors is largely unchanged. The amendments should be applied on a modified retrospective basis. ASU 2016-02 is effective for us beginning January 1, 2019. We are in the process of developing an inventory of our lease arrangements in order to determine the impact that the adoption of ASU 2016-02 will have on our consolidated financial statements and related disclosures. Based on our assessment to date, we expect adoption of this standard to result in a material increase in lease-related assets and liabilities on our Consolidated Balance Sheets; however, we do not expect it to have a significant impact on our Consolidated Statements of Income or Cash Flows. In March 2017, the FASB issued ASU No. 2017-07, Compensation-Retirement Benefits (Topic 715) . This ASU will require an employer to report the service cost component of net benefit cost in the same line item as other compensation costs arising from services rendered by the pertinent employees during the period. The other components of net benefit cost are required to be presented in the income statement separately from the service cost component and outside a subtotal of income from operations, if presented, or disclosed separately. In addition, only the service cost component may be eligible for capitalization where applicable. The amendments should be applied on a retrospective basis. ASU 2017-07 is effective for us beginning January 1, 2018, with early adoption permitted as of the beginning of a financial year. We will adopt the provisions of this ASU in the first quarter of 2018. Adoption of the new standard will only impact classification within our Consolidated Statements of Income. In August 2017, the FASB issued ASU No. 2017-12, Derivatives and Hedging (Topic 815): Targeted Improvements to Accounting for Hedging Activities , which amends ASC 815. The purpose of this ASU is to better align accounting rules with a company’s risk management activities and financial reporting for hedging relationships, better reflect economic results of hedging in financial statements, simplify hedge accounting requirements and improve the disclosures of hedging arrangements. The amendment should be applied using the modified retrospective transition method. ASU 2017-12 is effective for annual periods beginning after December 15, 2018 and interim periods within those annual periods, with early adoption permitted. We intend to adopt the provisions of this ASU in the first quarter of 2018. We believe the adoption of the new standard will not have a material impact on our Consolidated Financial Statements. No other new accounting pronouncement issued or effective during the fiscal year had or is expected to have a material impact on our consolidated financial statements or disclosures. |
BUSINESS ACQUISITIONS AND DIVES
BUSINESS ACQUISITIONS AND DIVESTITURES | 12 Months Ended |
Dec. 31, 2017 | |
Business Combinations [Abstract] | |
Business Acquisitions and Divestitures | BUSINESS ACQUISITIONS AND DIVESTITURES Acquisitions of businesses are accounted for as purchases and, accordingly, the results of operations of the businesses acquired have been included in the consolidated financial statements since the respective dates of the acquisitions. The purchase price for each acquisition is allocated to the assets acquired and liabilities assumed. 2016 Activity Ripple Brand Collective, LLC On April 26, 2016 , we completed the acquisition of all of the outstanding shares of Ripple Brand Collective, LLC, a privately held company that owned the barkTHINS mass premium chocolate snacking brand. The barkTHINS brand is largely sold in the United States in take-home resealable packages and is available in the club channel, as well as select natural and conventional grocers. The purchase consideration was allocated to assets acquired and liabilities assumed based on their respective fair values as follows: Goodwill $ 128,110 Trademarks 91,200 Other intangible assets 60,900 Other assets, primarily current assets, net of cash acquired totaling $674 12,375 Current liabilities (7,211 ) Net assets acquired $ 285,374 Goodwill is calculated as the excess of the purchase price over the fair value of the net assets acquired. The goodwill resulting from the acquisition is attributable primarily to the value of leveraging our brand building expertise, consumer insights, supply chain capabilities and retail relationships to accelerate growth and access to barkTHINS products. Acquired trademarks were assigned estimated useful lives of 27 years , while other intangibles, including customer relationships and covenants not to compete, were assigned estimated useful lives ranging from 2 to 14 years. The recorded goodwill, trademarks and other intangibles are expected to be deductible for tax purposes. Shanghai Golden Monkey In September 2014, we completed the acquisition of 80% of the outstanding shares of Shanghai Golden Monkey Food Joint Stock Co., Ltd. (“SGM”), a confectionery company based in Shanghai, China, whose product line is primarily sold through traditional trade channels. The acquisition was undertaken in order to leverage these traditional trade channels, which complemented our traditional China chocolate business that has historically been primarily distributed through Tier 1 or hypermarket channels. On February 3, 2016, we completed the purchase of the remaining 20% of the outstanding shares of SGM for cash consideration totaling $35,762 , pursuant to a new agreement entered into during the fourth quarter of 2015 with the selling SGM shareholders which revised the originally-agreed purchase price for these shares. For accounting purposes, we treated the acquisition as if we had acquired 100% at the initial acquisition date in 2014 and financed the payment for the remaining 20% of the outstanding shares. Therefore, the cash settlement of the liability for the purchase of these remaining shares is reflected within the financing section of the Consolidated Statements of Cash Flows. The final settlement also resulted in an extinguishment gain of $26,650 representing the net carrying amount of the recorded liability in excess of the cash paid to settle the obligation for the remaining 20% of the outstanding shares. This gain is recorded within non-operating other (income) expense, net within the Consolidated Statements of Income. 2015 Activity KRAVE Pure Foods In March 2015 , we completed the acquisition of all of the outstanding shares of KRAVE Pure Foods, Inc. (“Krave”), the Sonoma, California based manufacturer of Krave , a leading all-natural brand of premium meat snack products. The transaction was undertaken to allow Hershey to tap into the rapidly growing meat snacks category and further expand into the broader snacks space. Total purchase consideration included cash consideration of $220,016 , as well as agreement to pay additional cash consideration of up to $20,000 to the Krave shareholders if certain defined targets related to net sales and gross profit margin are met or exceeded during the twelve-month periods ending December 31, 2015 or March 31, 2016. The fair value of the contingent cash consideration was classified as a liability of $16,800 as of the acquisition date. Based on revised targets in a subsequent agreement with the Krave shareholders, the fair value was reduced over the second and third quarters of 2015 to $10,000 , with the adjustment to fair value recorded within selling, marketing and administrative expenses. The remaining $10,000 was paid in December 2015. The purchase consideration was allocated to assets acquired and liabilities assumed based on their respective fair values as follows: Goodwill $ 147,089 Trademarks 112,000 Other intangible assets 17,000 Other assets, primarily current assets, net of cash acquired totaling $1,362 9,465 Current liabilities (2,756 ) Non-current deferred tax liabilities (47,344 ) Net assets acquired $ 235,454 Goodwill was calculated as the excess of the purchase price over the fair value of the net assets acquired. The goodwill resulting from the acquisition was attributable primarily to the value of leveraging our brand building expertise, consumer insights, supply chain capabilities and retail relationships to accelerate growth and access to Krave products. The recorded goodwill is not expected to be deductible for tax purposes. Mauna Loa In December 2014, we entered into an agreement to sell the Mauna Loa Macadamia Nut Corporation (“Mauna Loa”), a business that had historically been reported within our North America segment. The transaction closed in the first quarter of 2015, resulting in proceeds, net of selling expenses and an estimated working capital adjustment, of $32,408 . The sale of Mauna Loa resulted in the recording of an additional loss on sale of $2,667 in the first quarter of 2015, based on updates to the selling expenses and tax benefits. The loss on the sale is reflected within business realignment costs in the Consolidated Statements of Income. |
GOODWILL AND INTANGIBLE ASSETS
GOODWILL AND INTANGIBLE ASSETS | 12 Months Ended |
Dec. 31, 2017 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill and Intangible Assets | GOODWILL AND INTANGIBLE ASSETS The changes in the carrying value of goodwill by reportable segment for the years ended December 31, 2017 and 2016 are as follows: North America International and Other Total Goodwill $ 667,056 $ 379,544 $ 1,046,600 Accumulated impairment loss (4,973 ) (357,375 ) (362,348 ) Balance at January 1, 2016 662,083 22,169 684,252 Acquired during the period (see Note 2) 128,110 — 128,110 Foreign currency translation 1,997 (2,015 ) (18 ) Balance at December 31, 2016 792,190 20,154 812,344 Foreign currency translation 7,739 978 8,717 Balance at December 31, 2017 $ 799,929 $ 21,132 $ 821,061 We had no goodwill impairment charges in 2017 or 2016. In 2015, we recorded goodwill impairment charges totaling $280,802 , which resulted from our interim reassessment of the valuation of the SGM business, coupled with a write-down of goodwill attributed to the China chocolate business in connection with the SGM acquisition, as discussed below. In 2015, since the SGM business had been performing below expectations, with net sales and earnings levels well below pre-acquisition levels, we performed an interim impairment test of the SGM reporting unit as of July 5, 2015 using an income approach based on our estimates of future performance scenarios for the business. The results of this test indicated that the fair value of the reporting unit was less than the carrying amount as of the measurement date, suggesting that a goodwill impairment was probable, which required us to perform a second step analysis to confirm that an impairment exists and to determine the amount of the impairment based on our reassessed value of the reporting unit. Although preliminary, as a result of this reassessment, in the second quarter of 2015 we recorded an estimated $249,811 non-cash goodwill impairment charge, representing a write-down of all of the goodwill related to the SGM reporting unit as of July 5, 2015. During the third quarter of 2015, we increased the value of acquired goodwill by $16,599 , with the corresponding offset principally represented by the establishment of additional opening balance sheet liabilities. We also finalized the impairment test of the goodwill relating to the SGM reporting unit, which resulted in a write-off of this additional goodwill in the third quarter, for a total impairment of $266,409 . At this time, we also tested the other long-lived assets of SGM for recoverability by comparing the sum of the undiscounted cash flows to the carrying value of the asset group, and no impairment was indicated. In connection with the 2014 SGM acquisition, we assigned approximately $15,000 of goodwill to our existing China chocolate business, as this reporting unit was expected to benefit from acquisition synergies relating to the sale of Golden Monkey-branded product through its Tier 1 and hypermarket distributor networks. As the net sales and earnings of our China business continued to be adversely impacted by macroeconomic challenges and changing consumer shopping behavior through the third quarter of 2015, we determined that an interim impairment test of the goodwill in this reporting unit was also required. We performed the first step of this test in the third quarter of 2015 using an income approach based on our estimates of future performance scenarios for the business. The results of this test suggested that a goodwill impairment was probable, and the conclusions of the second step analysis resulted in a write-down of $14,393 , representing the full value of goodwill attributed to this reporting unit as of October 4, 2015. The following table provides the gross carrying amount and accumulated amortization for each major class of intangible asset: December 31, 2017 2016 Gross Carrying Amount Accumulated Amortization Gross Carrying Amount Accumulated Amortization Intangible assets subject to amortization: Trademarks $ 277,473 $ (37,510 ) $ 317,023 $ (30,458 ) Customer-related 128,182 (34,659 ) 200,409 (36,482 ) Patents 17,009 (15,975 ) 16,426 (13,700 ) Total 422,664 (88,144 ) 533,858 (80,640 ) Intangible assets not subject to amortization: Trademarks 34,636 39,519 Total other intangible assets $ 369,156 $ 492,737 As discussed in Note 7, in February 2017, we commenced the Margin for Growth Program which includes an initiative to optimize the manufacturing operations supporting our China business. We deemed this to be a triggering event requiring us to test our China long-lived asset group for impairment by first determining whether the carrying value of the asset group was recovered by our current estimates of future cash flows associated with the asset group. Because this assessment indicated that the carrying value was not recoverable, we calculated an impairment loss as the excess of the asset group's carrying value over its fair value. The resulting impairment loss was allocated to the asset group's long-lived assets. Therefore, as a result of this testing, during the first quarter of 2017, we recorded an impairment charge totaling $105,992 representing the portion of the impairment loss that was allocated to the distributor relationship and trademark intangible assets that had been recognized in connection with the 2014 SGM acquisition. In connection with our annual impairment testing of indefinite lived intangible assets for 2016, we recognized a trademark impairment charge of $4,204 , primarily resulting from plans to discontinue a brand sold in India. Total amortization expense for the years ended December 31, 2017 , 2016 and 2015 was $23,376 , $26,687 and $22,306 , respectively. Amortization expense for the next five years, based on current intangible balances, is estimated to be as follows: Year ending December 31, 2018 2019 2020 2021 2022 Amortization expense $ 20,529 $ 19,599 $ 19,360 $ 19,345 $ 19,345 |
SHORT AND LONG-TERM DEBT
SHORT AND LONG-TERM DEBT | 12 Months Ended |
Dec. 31, 2017 | |
Debt Disclosure [Abstract] | |
Short and Long-Term Debt | SHORT AND LONG-TERM DEBT Short-term Debt As a source of short-term financing, we utilize cash on hand and commercial paper or bank loans with an original maturity of three months or less. We maintain a $1.0 billion unsecured revolving credit facility, which currently expires in November 2020. This agreement also includes an option to increase borrowings by an additional $400 million with the consent of the lenders. The unsecured committed revolving credit agreement contains a financial covenant whereby the ratio of (a) pre-tax income from operations from the most recent four fiscal quarters to (b) consolidated interest expense for the most recent four fiscal quarters may not be less than 2.0 to 1.0 at the end of each fiscal quarter. The credit agreement also contains customary representations, warranties and events of default. Payment of outstanding advances may be accelerated, at the option of the lenders, should we default in our obligation under the credit agreement. As of December 31, 2017 , we complied with all customary affirmative and negative covenants and the financial covenant pertaining to our credit agreement. There were no significant compensating balance agreements that legally restricted these funds. In addition to the revolving credit facility, we maintain lines of credit with domestic and international commercial banks. Our credit limit in various currencies was $440,148 at December 31, 2017 and $504,237 at December 31, 2016 . These lines permit us to borrow at the respective banks’ prime commercial interest rates, or lower. We had short-term foreign bank loans against these lines of credit for $110,684 at December 31, 2017 and $158,805 at December 31, 2016 . Commitment fees relating to our revolving credit facility and lines of credit are not material. At December 31, 2017 , we had outstanding commercial paper totaling $448,675 , at a weighted average interest rate of 1.4% . At December 31, 2016 , we had outstanding commercial paper totaling $473,666 , at a weighted average interest rate of 0.6% . The maximum amount of short-term borrowings outstanding during 2017 was $815,588 . The weighted-average interest rate on short-term borrowings outstanding was 1.7% as of December 31, 2017 and 1.0% as of December 31, 2016 . Long-term Debt Long-term debt consisted of the following: December 31, 2017 2016 1.60% Notes due 2018 $ 300,000 $ 300,000 4.125% Notes due 2020 350,000 350,000 8.8% Debentures due 2021 84,715 84,715 2.625% Notes due 2023 250,000 250,000 3.20% Notes due 2025 300,000 300,000 2.30% Notes due 2026 500,000 500,000 7.2% Debentures due 2027 193,639 193,639 3.375% Notes due 2046 300,000 300,000 Capital lease obligations 99,194 83,619 Net impact of interest rate swaps, debt issuance costs and unamortized debt discounts (16,427 ) (14,275 ) Total long-term debt 2,361,121 2,347,698 Less—current portion 300,098 243 Long-term portion $ 2,061,023 $ 2,347,455 In September 2016, we repaid $250,000 of 5.45% Notes due in 2016 upon their maturity. In November 2016, we repaid $250,000 of 1.50% Notes due in 2016 upon their maturity. In August 2016, we issued $500,000 of 2.30% Notes due in 2026 and $300,000 of 3.375% Notes due in 2046 (the "Notes"). Proceeds from the issuance of the Notes, net of discounts and issuance costs, totaled $792,953 . The Notes were issued under a shelf registration statement on Form S-3 filed in June 2015 that registered an indeterminate amount of debt securities. In August 2015, we paid $100,165 to repurchase $71,646 of our long-term debt as part of a cash tender offer, consisting of $15,285 of our 8.80% Debentures due in 2021 and $56,361 of our 7.20% Debentures due in 2027. We used a portion of the proceeds from the Notes issued in August 2015 to fund the repurchase. As a result of the repurchase, we recorded interest expense of $28,326 which represented the premium paid for the tender offer as well as the write-off of the related unamortized debt discount and debt issuance costs. Upon extinguishment of the debt, we unwound the fixed-to-floating interest rate swaps related to the tendered bonds and recognized a gain of $278 currently in interest expense resulting from the hedging instruments. Aggregate annual maturities of our long-term Notes (excluding capital lease obligations and net impact of interest rate swaps, debt issuance costs and unamortized debt discounts) are as follows for the years ending December 31: 2018 $ 300,098 2019 — 2020 350,000 2021 84,715 2022 — Thereafter 1,543,639 Our debt is principally unsecured and of equal priority. None of our debt is convertible into our Common Stock. Interest Expense Net interest expense consists of the following: For the years ended December 31, 2017 2016 2015 Interest expense $ 104,232 $ 97,851 $ 93,520 Capitalized interest (4,166 ) (5,903 ) (12,537 ) Loss on extinguishment of debt — — 28,326 Interest expense 100,066 91,948 109,309 Interest income (1,784 ) (1,805 ) (3,536 ) Interest expense, net $ 98,282 $ 90,143 $ 105,773 |
DERIVATIVE INSTRUMENTS
DERIVATIVE INSTRUMENTS | 12 Months Ended |
Dec. 31, 2017 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Derivative Instruments | DERIVATIVE INSTRUMENTS We are exposed to market risks arising principally from changes in foreign currency exchange rates, interest rates and commodity prices. We use certain derivative instruments to manage these risks. These include interest rate swaps to manage interest rate risk, foreign currency forward exchange contracts to manage foreign currency exchange rate risk, and commodities futures and options contracts to manage commodity market price risk exposures. In entering into these contracts, we have assumed the risk that might arise from the possible inability of counterparties to meet the terms of their contracts. We mitigate this risk by entering into exchanged-traded contracts with collateral posting requirements and/or by performing financial assessments prior to contract execution, conducting periodic evaluations of counterparty performance and maintaining a diverse portfolio of qualified counterparties. We do not expect any significant losses from counterparty defaults. Commodity Price Risk We enter into commodities futures and options contracts and other commodity derivative instruments to reduce the effect of future price fluctuations associated with the purchase of raw materials, energy requirements and transportation services. We generally hedge commodity price risks for 3 - to 24 -month periods. Our open commodity derivative contracts had a notional value of $405,288 as of December 31, 2017 and $739,374 as of December 31, 2016 . Derivatives used to manage commodity price risk are not designated for hedge accounting treatment. Therefore, the changes in fair value of these derivatives are recorded as incurred within cost of sales. As discussed in Note 11, we define our segment income to exclude gains and losses on commodity derivatives until the related inventory is sold, at which time the related gains and losses are reflected within segment income. This enables us to continue to align the derivative gains and losses with the underlying economic exposure being hedged and thereby eliminate the mark-to-market volatility within our reported segment income. Foreign Exchange Price Risk We are exposed to foreign currency exchange rate risk related to our international operations, including non-functional currency intercompany debt and other non-functional currency transactions of certain subsidiaries. Principal currencies hedged include the euro, Canadian dollar, Japanese yen, and Brazilian real. We typically utilize foreign currency forward exchange contracts to hedge these exposures for periods ranging from 3 to 12 months . The contracts are either designated as cash flow hedges or are undesignated. The net notional amount of foreign exchange contracts accounted for as cash flow hedges was $135,962 at December 31, 2017 and $68,263 at December 31, 2016 . The effective portion of the changes in fair value on these contracts is recorded in other comprehensive income and reclassified into earnings in the same period in which the hedged transactions affect earnings. The net notional amount of foreign exchange contracts that are not designated as accounting hedges was $2,791 at December 31, 2017 and December 31, 2016 , respectively. The change in fair value on these instruments is recorded directly in cost of sales or selling, marketing and administrative expense, depending on the nature of the underlying exposure. Interest Rate Risk We manage our targeted mix of fixed and floating rate debt with debt issuances and by entering into fixed-to-floating interest rate swaps in order to mitigate fluctuations in earnings and cash flows that may result from interest rate volatility. These swaps are designated as fair value hedges, for which the gain or loss on the derivative and the offsetting loss or gain on the hedged item are recognized in current earnings as interest expense (income), net. We had one interest rate derivative instrument in a fair value hedging relationship with a notional amount of $350,000 at December 31, 2017 and 2016 . In order to manage interest rate exposure, in previous years we utilized interest rate swap agreements to protect against unfavorable interest rate changes relating to forecasted debt transactions. These swaps, which were settled upon issuance of the related debt, were designated as cash flow hedges and the gains and losses that were deferred in other comprehensive income are being recognized as an adjustment to interest expense over the same period that the hedged interest payments affect earnings. During 2016, we had one interest rate swap agreement in a cash flow hedging relationship with a notional amount of $500,000 , which was settled in connection with the issuance of debt in August 2016, resulting in a payment of approximately $87,000 which is reflected as an operating cash flow within the Consolidated Statement of Cash Flows. Equity Price Risk We are exposed to market price changes in certain broad market indices related to our deferred compensation obligations to our employees. To mitigate this risk, we use equity swap contracts to hedge the portion of the exposure that is linked to market-level equity returns. These contracts are not designated as hedges for accounting purposes and are entered into for periods of 3 to 12 months . The change in fair value of these derivatives is recorded in selling, marketing and administrative expense, together with the change in the related liabilities. The notional amount of the contracts outstanding at December 31, 2017 and 2016 was $25,246 and $22,099 , respectively. The following table presents the classification of derivative assets and liabilities within the Consolidated Balance Sheets as of December 31, 2017 and 2016 : December 31, 2017 2016 Assets (1) Liabilities (1) Assets (1) Liabilities (1) Derivatives designated as cash flow hedging instruments: Foreign exchange contracts $ 423 $ 1,427 $ 2,229 $ 809 Derivatives designated as fair value hedging instruments: Interest rate swap agreements — 1,897 1,768 — Derivatives not designated as hedging instruments: Commodities futures and options (2) 390 3,054 2,348 10,000 Deferred compensation derivatives 1,581 — 717 — Foreign exchange contracts 31 — — 16 2,002 3,054 3,065 10,016 Total $ 2,425 $ 6,378 $ 7,062 $ 10,825 (1) Derivatives assets are classified on our balance sheet within prepaid expenses and other as well as other assets. Derivative liabilities are classified on our balance sheet within accrued liabilities and other long-term liabilities. (2) As of December 31, 2017 , amounts reflected on a net basis in liabilities were assets of $48,505 and liabilities of $50,179 , which are associated with cash transfers receivable or payable on commodities futures contracts reflecting the change in quoted market prices on the last trading day for the period. The comparable amounts reflected on a net basis in liabilities at December 31, 2016 were assets of $140,885 and liabilities of $150,872 . At December 31, 2017 and 2016 , the remaining amount reflected in assets and liabilities related to the fair value of other non-exchange traded derivative instruments, respectively. Income Statement Impact of Derivative Instruments The effect of derivative instruments on the Consolidated Statements of Income for the years ended December 31, 2017 and December 31, 2016 was as follows: Non-designated Hedges Cash Flow Hedges Gains (losses) recognized in income (a) Gains (losses) recognized in other comprehensive income (“OCI”) (effective portion) Gains (losses) reclassified from accumulated OCI into income (effective portion) (b) 2017 2016 2017 2016 2017 2016 Commodities futures and options $ (55,734 ) $ (171,753 ) $ — $ — $ (1,774 ) $ 30,783 Foreign exchange contracts (23 ) (46 ) (4,931 ) (5,485 ) (3,180 ) (5,625 ) Interest rate swap agreements — — — (47,223 ) (9,480 ) (8,676 ) Deferred compensation derivatives 4,497 2,203 — — — — Total $ (51,260 ) $ (169,596 ) $ (4,931 ) $ (52,708 ) $ (14,434 ) $ 16,482 (a) Gains (losses) recognized in income for non-designated commodities futures and options contracts were included in cost of sales. Gains (losses) recognized in income for non-designated foreign currency forward exchange contracts and deferred compensation derivatives were included in selling, marketing and administrative expenses. (b) Gains (losses) reclassified from AOCI into income were included in cost of sales for commodities futures and options contracts and for foreign currency forward exchange contracts designated as hedges of purchases of inventory or other productive assets. Other gains (losses) for foreign currency forward exchange contracts were included in selling, marketing and administrative expenses. Losses reclassified from AOCI into income for interest rate swap agreements were included in interest expense. The amount of pretax net losses on derivative instruments, including interest rate swap agreements and foreign currency forward exchange contracts expected to be reclassified into earnings in the next 12 months was approximately $10,484 as of December 31, 2017 . This amount was primarily associated with interest rate swap agreements. Fair Value Hedges For the years ended December 31, 2017 and 2016 , we recognized a net pretax benefit to interest expense of $2,660 and $4,365 relating to our fixed-to-floating interest swap arrangements. |
FAIR VALUE MEASUREMENTS FAIR VA
FAIR VALUE MEASUREMENTS FAIR VALUE MEASUREMENTS | 12 Months Ended |
Dec. 31, 2017 | |
FAIR VALUE MEASUREMENTS [Abstract] | |
Fair Value Measurements | FAIR VALUE MEASUREMENTS Accounting guidance on fair value measurements requires that financial assets and liabilities be classified and disclosed in one of the following categories of the fair value hierarchy: Level 1 – Based on unadjusted quoted prices for identical assets or liabilities in an active market. Level 2 – Based on observable market-based inputs or unobservable inputs that are corroborated by market data. Level 3 – Based on unobservable inputs that reflect the entity's own assumptions about the assumptions that a market participant would use in pricing the asset or liability. We did not have any level 3 financial assets or liabilities, nor were there any transfers between levels during the periods presented. The following table presents assets and liabilities that were measured at fair value in the Consolidated Balance Sheet on a recurring basis as of December 31, 2017 and 2016 : Assets (Liabilities) Level 1 Level 2 Level 3 Total December 31, 2017: Derivative Instruments: Assets: Foreign exchange contracts (1) $ — $ 454 $ — $ 454 Deferred compensation derivatives (3) — 1,581 — 1,581 Commodities futures and options (4) 390 — — 390 Liabilities: Foreign exchange contracts (1) — 1,427 — 1,427 Interest rate swap agreements (2) — 1,897 — 1,897 Commodities futures and options (4) 3,054 — — 3,054 December 31, 2016: Assets: Foreign exchange contracts (1) $ — $ 2,229 $ — $ 2,229 Interest rate swap agreements (2) — 1,768 — 1,768 Deferred compensation derivatives (3) — 717 — 717 Commodities futures and options (4) 2,348 — — 2,348 Liabilities: Foreign exchange contracts (1) — 825 — 825 Commodities futures and options (4) 10,000 — — 10,000 (1) The fair value of foreign currency forward exchange contracts is the difference between the contract and current market foreign currency exchange rates at the end of the period. We estimate the fair value of foreign currency forward exchange contracts on a quarterly basis by obtaining market quotes of spot and forward rates for contracts with similar terms, adjusted where necessary for maturity differences. (2) The fair value of interest rate swap agreements represents the difference in the present value of cash flows calculated at the contracted interest rates and at current market interest rates at the end of the period. We calculate the fair value of interest rate swap agreements quarterly based on the quoted market price for the same or similar financial instruments. (3) The fair value of deferred compensation derivatives is based on quoted prices for market interest rates and a broad market equity index. (4) The fair value of commodities futures and options contracts is based on quoted market prices. Other Financial Instruments The carrying amounts of cash and cash equivalents, short-term investments, accounts receivable, accounts payable and short-term debt approximated fair values as of December 31, 2017 and December 31, 2016 because of the relatively short maturity of these instruments. The estimated fair value of our long-term debt is based on quoted market prices for similar debt issues and is, therefore, classified as Level 2 within the valuation hierarchy. The fair values and carrying values of long-term debt, including the current portion, were as follows: Fair Value Carrying Value At December 31, 2017 2016 2017 2016 Current portion of long-term debt $ 299,430 $ 243 $ 300,098 $ 243 Long-term debt 2,113,296 2,379,054 2,061,023 2,347,455 Total $ 2,412,726 $ 2,379,297 $ 2,361,121 $ 2,347,698 Other Fair Value Measurements In addition to assets and liabilities that are recorded at fair value on a recurring basis, GAAP requires that, under certain circumstances, we also record assets and liabilities at fair value on a nonrecurring basis. Generally, assets are recorded at fair value on a nonrecurring basis as a result of impairment charges. During the first quarter of 2017, as discussed in Note 7, we recorded impairment charges totaling $105,992 to write-down distributor relationship and trademark intangible assets that had been recognized in connection with the 2014 SGM acquisition and wrote-down property, plant and equipment by $102,720 . These charges were determined by comparing the fair value of the assets to their carrying value. The fair value of the assets were derived using a combination of an estimated market liquidation approach and discounted cash flow analyses based on Level 3 inputs. |
BUSINESS REALIGNMENT ACTIVITIES
BUSINESS REALIGNMENT ACTIVITIES | 12 Months Ended |
Dec. 31, 2017 | |
Restructuring and Related Activities [Abstract] | |
Business Realignment Activities | BUSINESS REALIGNMENT ACTIVITIES We are currently pursuing several business realignment activities designed to increase our efficiency and focus our business in support of our key growth strategies. Costs recorded in 2017 , 2016 and 2015 related to these activities are as follows: For the years ended December 31, 2017 2016 2015 Margin for Growth Program: Severance $ 32,554 $ — $ — Accelerated depreciation 6,873 — — Other program costs 16,407 — — Operational Optimization Program: Severance 13,828 17,872 — Accelerated depreciation — 48,590 — Other program costs (303 ) 21,831 — 2015 Productivity Initiative: Severance — — 81,290 Pension settlement charges — 13,669 10,178 Other program costs — 5,609 14,285 Other international restructuring programs: Severance — — 6,651 Accelerated depreciation and amortization — — 5,904 Mauna Loa Divestiture (see Note 2) — — 2,667 Total $ 69,359 $ 107,571 $ 120,975 The costs and related benefits of the Margin for Growth Program relate approximately 45% to the North America segment and 55% to the International and Other segment. The costs and related benefits of the Operational Optimization Program relate approximately 35% to the North America segment and 65% to the International and Other segment on a cumulative program to date basis. The costs and related benefits to be derived from the 2015 Productivity Initiative relate primarily to the North American segment. However, segment operating results do not include these business realignment expenses because we evaluate segment performance excluding such costs. Margin for Growth Program In February 2017, the Company's Board of Directors unanimously approved several initiatives under a single program designed to drive continued net sales, operating income and earnings per-share diluted growth over the next several years. This program will focus on improving global efficiency and effectiveness, optimizing the Company’s supply chain, streamlining the Company’s operating model and reducing administrative expenses to generate long-term savings. The Company estimates that the “Margin for Growth” program will result in total pre-tax charges of $375,000 to $425,000 from 2017 to 2019. This estimate includes plant and office closure expenses of $100,000 to $115,000 , net intangible asset impairment charges of $100,000 to $110,000 , employee separation costs of $80,000 to $100,000 , contract termination costs of approximately $25,000 , and other business realignment costs of $70,000 to $75,000 . The cash portion of the total charge is estimated to be $150,000 to $175,000 . The Company expects that implementation of the program will reduce its global workforce by approximately 15% , with a majority of the reductions coming from hourly headcount positions outside of the United States. The program includes an initiative to optimize the manufacturing operations supporting our China business. We deemed this to be a triggering event requiring us to test our China long-lived asset group for impairment by first determining whether the carrying value of the asset group was recovered by our current estimates of future cash flows associated with the asset group. Because this assessment indicated that the carrying value was not recoverable, we calculated an impairment loss as the excess of the asset group's carrying value over its fair value. The resulting impairment loss was allocated to the asset group's long-lived assets. Therefore, as a result of this testing, during the first quarter of 2017, we recorded impairment charges totaling $208,712 , with $105,992 representing the portion of the impairment loss that was allocated to the distributor relationship and trademark intangible assets that had been recognized in connection with the 2014 SGM acquisition and $102,720 representing the portion of the impairment loss that was allocated to property, plant and equipment. These impairment charges are recorded in the long-lived asset impairment charges caption within the Consolidated Statements of Operations. During 2017, we recognized estimated employee severance totaling $32,554 . These charges relate largely to our initiative to improve the cost structure of our China business, as well as our initiative to further streamline our corporate operating model. We also recognized non-cash, asset-related incremental depreciation expense totaling $6,873 as part of optimizing the North America supply chain. During 2017, we also incurred other program costs totaling $16,407 , which relate primarily to third-party charges in support of our initiative to improve global efficiency and effectiveness. 2016 Operational Optimization Program In the second quarter of 2016, we commenced a program (the “Operational Optimization Program”) to optimize our production and supply chain network, which includes select facility consolidations. The program encompasses the continued transition of our China chocolate and SGM operations into a united Golden Hershey platform, including the integration of the China sales force, as well as workforce planning efforts and the consolidation of production within certain facilities in China and North America. For the year ended December 31, 2017 , we incurred pre-tax costs totaling $13,525 , primarily related to employee severance associated with the workforce planning efforts within North America. We currently expect to incur additional cash costs of approximately $8,000 over the next twelve months to complete the remaining facility consolidation efforts relating to this program. 2015 Productivity Initiative In mid-2015, we initiated a productivity initiative (the “2015 Productivity Initiative”) intended to move decision making closer to the customer and the consumer, to enable a more enterprise-wide approach to innovation, to more swiftly advance our knowledge agenda, and to provide for a more efficient cost structure, while ensuring that we effectively allocate resources to future growth areas. Overall, the 2015 Productivity Initiative was undertaken to simplify the organizational structure to enhance the Company's ability to rapidly anticipate and respond to the changing demands of the global consumer. The 2015 Productivity Initiative was executed throughout the third and fourth quarters of 2015, resulting in a net reduction of approximately 300 positions, with the majority of the departures taking place by the end of 2015. The 2015 Productivity Initiative was completed during the third quarter 2016. We incurred total costs of $125,031 relating to this program, including pension settlement charges of $13,669 recorded in 2016 and $10,178 recorded in 2015 relating to lump sum withdrawals by employees retiring or leaving the Company as a result of this program. Other international restructuring programs Costs incurred for the year ended December 31, 2015 related principally to accelerated depreciation and amortization and employee severance costs for minor programs commenced in 2014 to rationalize certain non-U.S. manufacturing and distribution activities and to establish our own sales and distribution teams in Brazil in connection with our exit from the Bauducco joint venture. Costs associated with business realignment activities are classified in our Consolidated Statements of Income as follows: For the years ended December 31, 2017 2016 2015 Cost of sales $ 5,147 $ 58,106 $ 8,801 Selling, marketing and administrative expense 16,449 16,939 17,368 Business realignment costs 47,763 32,526 94,806 Costs associated with business realignment activities $ 69,359 $ 107,571 $ 120,975 The following table presents the liability activity for costs qualifying as exit and disposal costs for the year ended December 31, 2017 : Total Liability balance at December 31, 2016 $ 3,725 2017 business realignment charges (1) 61,872 Cash payments (26,536 ) Other, net (69 ) Liability balance at December 31, 2017 (reported within accrued and other long-term liabilities) $ 38,992 (1) The costs reflected in the liability roll-forward represent employee-related and certain third-party service provider charges. These costs do not include items charged directly to expense, such as accelerated depreciation and amortization and certain of the third-party charges associated with various programs, as those items are not reflected in the business realignment liability in our Consolidated Balance Sheets. |
INCOME TAXES
INCOME TAXES | 12 Months Ended |
Dec. 31, 2017 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | INCOME TAXES The components of income (loss) before income taxes are as follows: For the years ended December 31, 2017 2016 2015 Domestic $ 1,187,825 $ 1,395,440 $ 1,357,618 Foreign (77,157 ) (295,959 ) (455,771 ) Income before income taxes $ 1,110,668 $ 1,099,481 $ 901,847 The components of our provision for income taxes are as follows: For the years ended December 31, 2017 2016 2015 Current: Federal $ 314,277 $ 391,705 $ 409,060 State 37,628 51,706 47,978 Foreign (16,356 ) (25,877 ) (29,605 ) 335,549 417,534 427,433 Deferred: Federal 19,204 (7,706 ) (31,153 ) State 7,573 (452 ) (2,346 ) Foreign (8,195 ) (29,939 ) (5,038 ) 18,582 (38,097 ) (38,537 ) Total provision for income taxes $ 354,131 $ 379,437 $ 388,896 U.S. Tax Cuts and Jobs Act of 2017 The U.S. Tax Cuts and Jobs Act, enacted in December 2017, (“U.S. tax reform”) significantly changes U.S. corporate income tax laws by, among other things, reducing the U.S. corporate income tax rate to 21% starting in 2018 and creating a territorial tax system with a one-time mandatory tax on previously deferred foreign earnings of U.S. subsidiaries. Under GAAP (specifically, ASC Topic 740), the effects of changes in tax rates and laws on deferred tax balances are recognized in the period in which the new legislation is enacted. In response to U.S. tax reform, the Staff of the U.S. Securities and Exchange Commission issued Staff Accounting Bulletin No. 118 (“SAB No. 118”) to provide guidance to registrants in applying ASC Topic 740 in connection with U.S. tax reform. SAB No. 118 provides that in the period of enactment, the income tax effects of U.S. tax reform may be reported as a provisional amount based on a reasonable estimate (to the extent a reasonable estimate can be determined), which would be subject to adjustment during a “measurement period.” The measurement period begins in the reporting period of U.S. tax reform’s enactment and ends when a registrant has obtained, prepared and analyzed the information that was needed in order to complete the accounting requirements under ASC Topic 740. SAB No. 118 also describes supplemental disclosure that should accompany the provisional amounts. U.S. tax reform represents the first significant change in U.S. tax law in over 30 years. As permitted by SAB No. 118, some elements of the tax expense recorded in the fourth quarter of 2017 due to the enactment of U.S. tax reform are considered “provisional,” based on reasonable estimates. The Company is continuing to collect and analyze detailed information about deferred income taxes, the earnings and profits of its non-U.S. subsidiaries, the related taxes paid, the amounts which could be repatriated, the foreign taxes which may be incurred on repatriation and the associated impact of these items under U.S. tax reform. The Company may record adjustments to refine those estimates during the measurement period, as additional analysis is completed. As a result, we recorded a net charge of $32.5 million during the fourth quarter of 2017. This amount, which is reflected within the provision for income taxes in the Consolidated Statement of Income, includes the estimated impact of the one-time mandatory tax on previously deferred earnings of non-U.S. subsidiaries offset in part by the benefit from revaluation of net deferred tax liabilities based on the new lower corporate income tax rate. The impact of the U.S. tax reform may differ from this estimate, possibly materially, due to, among other things, changes in interpretations and assumptions made, additional guidance that may be issued and actions taken by Hershey as a result of the U.S. tax reform. Deferred taxes reflect temporary differences between the tax basis and financial statement carrying value of assets and liabilities. The significant temporary differences that comprised the deferred tax assets and liabilities are as follows: December 31, 2017 2016 Deferred tax assets: Post-retirement benefit obligations $ 58,306 $ 90,584 Accrued expenses and other reserves 103,769 141,228 Stock-based compensation 31,364 48,500 Derivative instruments 27,109 44,010 Pension — 14,662 Lease financing obligation 12,310 18,950 Accrued trade promotion reserves 26,028 50,463 Net operating loss carryforwards 226,142 143,085 Capital loss carryforwards 23,215 38,691 Other 7,748 14,452 Gross deferred tax assets 515,991 604,625 Valuation allowance (312,148 ) (235,485 ) Total deferred tax assets 203,843 369,140 Deferred tax liabilities: Property, plant and equipment, net 132,443 202,300 Acquired intangibles 68,476 113,074 Inventories 20,769 27,608 Pension 969 — Other 23,819 8,884 Total deferred tax liabilities 246,476 351,866 Net deferred tax (liabilities) assets $ (42,633 ) $ 17,274 Included in: Non-current deferred tax assets, net 3,023 56,861 Non-current deferred tax liabilities, net (45,656 ) (39,587 ) Net deferred tax (liabilities) assets $ (42,633 ) $ 17,274 Changes in deferred taxes includes the impact of remeasurement on U.S. deferred taxes at the lower enacted corporate tax rates resulting from the U.S. tax reform. Changes in deferred tax assets for net operating loss carryforwards resulted primarily from current year losses in foreign jurisdictions. The valuation allowances as of December 31, 2017 and 2016 are primarily related to U.S. capital loss carryforwards and various foreign jurisdictions' net operating loss carryforwards and other deferred tax assets that we do not expect to realize. The following table reconciles the federal statutory income tax rate with our effective income tax rate: For the years ended December 31, 2017 2016 2015 Federal statutory income tax rate 35.0 % 35.0 % 35.0 % Increase (reduction) resulting from: State income taxes, net of Federal income tax benefits 2.6 3.4 4.2 Qualified production income deduction (2.9 ) (3.8 ) (4.4 ) Business realignment and impairment charges and gain on sale of trademark licensing rights 4.3 0.4 10.8 Foreign rate differences (4.3 ) 3.6 2.2 Historic and solar tax credits (4.8 ) (3.3 ) (3.3 ) U.S. tax reform 2.9 — — Other, net (0.9 ) (0.8 ) (1.4 ) Effective income tax rate 31.9 % 34.5 % 43.1 % A reconciliation of the beginning and ending amount of unrecognized tax benefits is as follows: December 31, 2017 2016 Balance at beginning of year $ 36,002 $ 33,411 Additions for tax positions taken during prior years 2,492 2,804 Reductions for tax positions taken during prior years (1,689 ) (4,080 ) Additions for tax positions taken during the current year 10,018 9,100 Settlements (1,481 ) — Expiration of statutes of limitations (3,260 ) (5,233 ) Balance at end of year $ 42,082 $ 36,002 The total amount of unrecognized tax benefits that, if recognized, would affect the effective tax rate was $37,587 as of December 31, 2017 and $27,691 as of December 31, 2016 . We report accrued interest and penalties related to unrecognized tax benefits in income tax expense. We recognized a net tax expense of $795 in 2017 , a net tax benefit of $75 in 2016 and a net tax expense of $1,153 in 2015 for interest and penalties. Accrued net interest and penalties were $4,966 as of December 31, 2017 and $3,716 as of December 31, 2016 . We file income tax returns in the U.S. federal jurisdiction and various state and foreign jurisdictions. A number of years may elapse before an uncertain tax position, for which we have unrecognized tax benefits, is audited and finally resolved. While it is often difficult to predict the final outcome or the timing of resolution of any particular uncertain tax position, we believe that our unrecognized tax benefits reflect the most likely outcome. We adjust these unrecognized tax benefits, as well as the related interest, in light of changing facts and circumstances. Settlement of any particular position could require the use of cash. Favorable resolution would be recognized as a reduction to our effective income tax rate in the period of resolution. The Company’s major taxing jurisdictions currently include the United States (federal and state), as well as various foreign jurisdictions such as Canada, China, Mexico, Brazil, India, Malaysia and Switzerland. The number of years with open tax audits varies depending on the tax jurisdiction, with 2013 representing the earliest tax year that remains open for examination by certain taxing authorities. In 2017, the U.S. Internal Revenue Service began an examination of our U.S. federal income tax returns for 2013 and 2014. We reasonably expect reductions in the liability for unrecognized tax benefits of approximately $8,089 within the next 12 months because of the expiration of statutes of limitations and settlements of tax audits. As of December 31, 2017 , we had approximately $370,027 of undistributed earnings of our international subsidiaries. We intend to continue to reinvest earnings outside the United States for the foreseeable future and, therefore, have not recognized additional tax expense (e.g., foreign withholding taxes) on these earnings beyond the one-time U.S. repatriation tax due under the Tax Cuts and Jobs Act. Investments in Partnerships Qualifying for Tax Credits We invest in partnerships which make equity investments in projects eligible to receive federal historic and energy tax credits. The investments are accounted for under the equity method and reported within other assets in our Consolidated Balance Sheets. The tax credits, when realized, are recognized as a reduction of tax expense, at which time the corresponding equity investment is written-down to reflect the remaining value of the future benefits to be realized. For the years ended December 31, 2017 and 2016 , we recognized investment tax credits and related outside basis difference benefit totaling $74,600 and $52,342 , respectively, and we wrote-down the equity investment by $66,209 and $43,482 , respectively, to reflect the realization of these benefits. The equity investment write-down is reflected within other (income) expense, net in the Consolidated Statements of Income. |
PENSION AND OTHER POST-RETIREME
PENSION AND OTHER POST-RETIREMENT BENEFIT PLANS | 12 Months Ended |
Dec. 31, 2017 | |
Retirement Benefits [Abstract] | |
Pension and Other Post-Retirement Benefit Plans | PENSION AND OTHER POST-RETIREMENT BENEFIT PLANS We sponsor a number of defined benefit pension plans. The primary plans are The Hershey Company Retirement Plan and The Hershey Company Retirement Plan for Hourly Employees. These are cash balance plans that provide pension benefits for most domestic employees hired prior to January 1, 2007. We also sponsor two post-retirement benefit plans: health care and life insurance. The health care plan is contributory, with participants’ contributions adjusted annually. The life insurance plan is non-contributory. Obligations and Funded Status A summary of the changes in benefit obligations, plan assets and funded status of these plans is as follows: Pension Benefits Other Benefits December 31, 2017 2016 2017 2016 Change in benefit obligation Projected benefit obligation at beginning of year $ 1,118,318 $ 1,169,424 $ 242,846 $ 255,617 Service cost 20,657 23,075 263 299 Interest cost 40,996 41,875 8,837 9,731 Plan amendments (8,473 ) (43,065 ) — — Actuarial (gain) loss 40,768 15,804 2,207 (2,998 ) Settlement (44,978 ) (59,784 ) — — Currency translation and other 6,749 1,416 889 314 Benefits paid (56,473 ) (30,427 ) (18,930 ) (20,117 ) Projected benefit obligation at end of year 1,117,564 1,118,318 236,112 242,846 Change in plan assets Fair value of plan assets at beginning of year 1,023,676 1,041,902 — — Actual return on plan assets 121,241 49,012 — — Employer contributions 37,503 21,580 18,930 20,117 Settlement (44,978 ) (59,784 ) — — Currency translation and other 5,257 1,393 — — Benefits paid (56,473 ) (30,427 ) (18,930 ) (20,117 ) Fair value of plan assets at end of year 1,086,226 1,023,676 — — Funded status at end of year $ (31,338 ) $ (94,642 ) $ (236,112 ) $ (242,846 ) Amounts recognized in the Consolidated Balance Sheets: Other assets $ 14,988 $ 39 $ — $ — Accrued liabilities (6,916 ) (28,994 ) (20,792 ) (22,576 ) Other long-term liabilities (39,410 ) (65,687 ) (215,320 ) (220,270 ) Total $ (31,338 ) $ (94,642 ) $ (236,112 ) $ (242,846 ) Amounts recognized in Accumulated Other Comprehensive Income (Loss), net of tax: Actuarial net (loss) gain $ (207,659 ) $ (243,228 ) $ 8,313 $ 9,264 Net prior service credit (cost) 30,994 28,360 (1,174 ) (1,565 ) Net amounts recognized in AOCI $ (176,665 ) $ (214,868 ) $ 7,139 $ 7,699 The accumulated benefit obligation for all defined benefit pension plans was $1,077,112 as of December 31, 2017 and $1,081,261 as of December 31, 2016 . Plans with accumulated benefit obligations in excess of plan assets were as follows: December 31, 2017 2016 Projected benefit obligation $ 711,767 $ 1,118,294 Accumulated benefit obligation 675,660 1,081,254 Fair value of plan assets 665,441 1,023,613 Net Periodic Benefit Cost The components of net periodic benefit cost were as follows: Pension Benefits Other Benefits For the years ended December 31, 2017 2016 2015 2017 2016 2015 Amounts recognized in net periodic benefit cost Service cost $ 20,657 $ 23,075 $ 28,300 $ 263 $ 299 $ 542 Interest cost 40,996 41,875 44,179 8,837 9,731 10,187 Expected return on plan assets (57,370 ) (58,820 ) (68,830 ) — — — Amortization of prior service (credit) cost (5,822 ) (1,555 ) (1,178 ) 748 575 611 Amortization of net loss (gain) 33,648 34,940 30,510 (1 ) (13 ) (57 ) Curtailment credit — — (688 ) — — 204 Settlement loss 17,732 22,657 23,067 — — — Total net periodic benefit cost $ 49,841 $ 62,172 $ 55,360 $ 9,847 $ 10,592 $ 11,487 Change in plan assets and benefit obligations recognized in AOCI, pre-tax Actuarial net (gain) loss $ (73,768 ) $ (31,772 ) $ (21,554 ) $ 2,139 $ (3,047 ) $ (26,270 ) Prior service (credit) cost (2,650 ) (41,517 ) 1,748 (744 ) (572 ) (834 ) Total recognized in other comprehensive (income) loss, pre-tax $ (76,418 ) $ (73,289 ) $ (19,806 ) $ 1,395 $ (3,619 ) $ (27,104 ) Net amounts recognized in periodic benefit cost and AOCI $ (26,577 ) $ (11,117 ) $ 35,554 $ 11,242 $ 6,973 $ (15,617 ) Amounts expected to be amortized from AOCI into net periodic benefit cost during 2018 are as follows: Pension Plans Post-Retirement Benefit Plans Amortization of net actuarial loss $ 26,735 $ — Amortization of prior service (credit) cost $ (7,197 ) $ 836 Assumptions The weighted-average assumptions used in computing the benefit obligations were as follows: Pension Benefits Other Benefits December 31, 2017 2016 2017 2016 Discount rate 3.4 % 3.8 % 3.5 % 3.8 % Rate of increase in compensation levels 3.8 % 3.8 % N/A N/A The weighted-average assumptions used in computing net periodic benefit cost were as follows: Pension Benefits Other Benefits For the years ended December 31, 2017 2016 2015 2017 2016 2015 Discount rate 3.8 % 4.0 % 3.7 % 3.8 % 4.0 % 3.7 % Expected long-term return on plan assets 5.8 % 6.1 % 6.3 % N/A N/A N/A Rate of compensation increase 3.8 % 3.8 % 4.1 % N/A N/A N/A The Company’s discount rate assumption is determined by developing a yield curve based on high quality corporate bonds with maturities matching the plans’ expected benefit payment streams. The plans’ expected cash flows are then discounted by the resulting year-by-year spot rates. We base the asset return assumption on current and expected asset allocations, as well as historical and expected returns on the plan asset categories. Prior to December 31, 2017, the service and interest cost components of net periodic benefit cost were determined utilizing a single weighted-average discount rate derived from the yield curve used to measure the plan obligations. Beginning in 2018, we have elected to utilize a full yield curve approach in the estimation of service and interest costs by applying the specific spot rates along the yield curve used in the determination of the benefit obligation to the relevant projected cash flows. We made this change to provide a more precise measurement of service and interest costs by improving the correlation between the projected cash flows to the corresponding spot rates along the yield curve. This change does not affect the measurement of our pension and other post-retirement benefit liabilities but generally results in lower benefit expense in periods when the yield curve is upward sloping. Compared to the method used in 2017, we expect this change to result in lower pension and other post-retirement benefit expense of approximately $5,800 in 2018. We are accounting for this change prospectively as a change in accounting estimate that is inseparable from a change in accounting principle. For purposes of measuring our post-retirement benefit obligation at December 31, 2017 , we assumed a 7.0% annual rate of increase in the per capita cost of covered health care benefits for 2018 , grading down to 5.0% by 2023. For measurement purposes as of December 31, 2016 , we assumed a 7.0% annual rate of increase in the per capita cost of covered health care benefits for 2017 , grading down to 5.0% by 2021. Assumed health care cost trend rates could have a significant effect on the amounts reported for the post-retirement health care plans. A one-percentage point change in assumed health care cost trend rates would have the following effects: Impact of assumed health care cost trend rates One-Percentage One-Percentage Effect on total service and interest cost components $ 148 $ (129 ) Effect on accumulated post-retirement benefit obligation 3,133 (2,758 ) The valuations and assumptions reflect adoption of the Society of Actuaries updated RP-2014 mortality tables with MP-2017 generational projection scales, which we adopted as of December 31, 2017. Adoption of the updated scale did not have a significant impact on our current pension obligations or net period benefit cost since our primary plans are cash balance plans and most participants take lump-sum settlements upon retirement. Plan Assets We broadly diversify our pension plan assets across public equity, fixed income, diversified credit strategies and diversified alternative strategies asset classes. Our target asset allocation for our major domestic pension plans as of December 31, 2017 was as follows: Asset Class Target Asset Allocation Cash 1% Equity securities 25% Fixed income securities 49% Alternative investments, including real estate, listed infrastructure and other 25% As of December 31, 2017 , actual allocations were consistent with the targets and within our allowable ranges. We expect the level of volatility in pension plan asset returns to be in line with the overall volatility of the markets within each asset class. The following table sets forth by level, within the fair value hierarchy (as defined in Note 6), pension plan assets at their fair values as of December 31, 2017 : Quoted prices in active markets of identical assets Significant other observable inputs Significant other unobservable inputs (Level 3) Investments Using NAV as a Practical Expedient (1) Total Cash and cash equivalents $ 1,179 $ 18,161 $ — $ 730 $ 20,070 Equity securities: Global all-cap (a) — — — 276,825 276,825 Fixed income securities: U.S. government/agency — — — 239,686 239,686 Corporate bonds (b) — 33,019 — 162,633 195,652 Collateralized obligations (c) — 40,350 — 34,538 74,888 International government/corporate bonds (d) — — — 32,447 32,447 Alternative investments: Global diversified assets (e) — — — 149,030 149,030 Global real estate investment trusts (f) — — — 50,213 50,213 Global infrastructure (g) — — — 47,415 47,415 Total pension plan assets $ 1,179 $ 91,530 $ — $ 993,517 $ 1,086,226 The following table sets forth by level, within the fair value hierarchy, pension plan assets at their fair values as of December 31, 2016 : Quoted prices in active markets of identical assets (Level 1) Significant other observable inputs (Level 2) Significant other unobservable inputs (Level 3) Total Cash and cash equivalents $ 576 $ 9,540 $ — $ 10,116 Equity securities: Global all-cap (a) 20,216 242,214 — 262,430 Fixed income securities: U.S. government/agency — 228,648 — 228,648 Corporate bonds (b) — 199,634 — 199,634 Collateralized obligations (c) — 50,532 — 50,532 International government/corporate bonds (d) — 30,928 — 30,928 Alternative investments: Global diversified assets (e) — 146,975 — 146,975 Global real estate investment trusts (f) — 48,000 — 48,000 Global infrastructure (g) — 46,413 — 46,413 Total pension plan assets $ 20,792 $ 1,002,884 $ — $ 1,023,676 (1) Certain investments that are measured at fair value using the net asset value per share (or its equivalent) practical expedient have not been categorized in the fair value hierarchy but are included to reconcile to the amounts presented in our Obligations and Funded Status table. (a) This category comprises equity funds that primarily track the MSCI World Index or MSCI All Country World Index. (b) This category comprises fixed income funds primarily invested in investment grade and high yield bonds. (c) This category comprises fixed income funds primarily invested in high quality mortgage-backed securities and other asset-backed obligations. (d) This category comprises fixed income funds primarily invested in Canadian and other international bonds. (e) This category comprises diversified funds invested across alternative asset classes. (f) This category comprises equity funds primarily invested in publicly traded real estate securities. (g) This category comprises equity funds primarily invested in publicly traded listed infrastructure securities. The fair value of the Level 1 assets was based on quoted prices in active markets for the identical assets. The fair value of the Level 2 assets was determined by management based on an assessment of valuations provided by asset management entities and was calculated by aggregating market prices for all underlying securities. Investment objectives for our domestic plan assets are: l To ensure high correlation between the value of plan assets and liabilities; l To maintain careful control of the risk level within each asset class; and l To focus on a long-term return objective. We believe that there are no significant concentrations of risk within our plan assets as of December 31, 2017 . We comply with the rules and regulations promulgated under the Employee Retirement Income Security Act of 1974 (“ERISA”) and we prohibit investments and investment strategies not allowed by ERISA. We do not permit direct purchases of our Company’s securities or the use of derivatives for the purpose of speculation. We invest the assets of non-domestic plans in compliance with laws and regulations applicable to those plans. Cash Flows and Plan Termination Our policy is to fund domestic pension liabilities in accordance with the limits imposed by the ERISA, federal income tax laws and the funding requirements of the Pension Protection Act of 2006. We fund non-domestic pension liabilities in accordance with laws and regulations applicable to those plans. We made total contributions to the pension plans of $37,503 during 2017 . This included contributions totaling $29,201 to fund payouts from the unfunded supplemental retirement plans and $6,461 to complete the termination of the Hershey Company Puerto Rico Hourly Pension Plan, which was approved in 2016 by the Company's Board Compensation and Executive Organization Committee. In 2016 , we made total contributions of $21,580 to the pension plans. For 2018 , minimum funding requirements for our pension plans are approximately $1,591 . Total benefit payments expected to be paid to plan participants, including pension benefits funded from the plans and other benefits funded from Company assets, are as follows: Expected Benefit Payments 2018 2019 2020 2021 2022 2023-2027 Pension Benefits $ 126,392 $ 78,614 $ 85,804 $ 87,159 $ 107,005 $ 407,769 Other Benefits 20,773 19,026 17,768 16,863 15,767 69,003 During the third quarter of 2017, cumulative lump sum distributions from our supplemental executive retirement plan exceeded the plan’s anticipated annual service and interest costs, triggering the recognition of non-cash pension settlement charges due to the acceleration of a portion of the accumulated unrecognized actuarial loss. In addition, settlement charges were also triggered in the pension plan benefiting our employees in Puerto Rico as a result of lump sum distributions and the purchase of annuity contracts relating to the termination of this plan. Multiemployer Pension Plan During 2016, we exited a facility as part of the 2016 Operational Optimization Program (see Note 7) and no longer participate in the BCTGM Union and Industry Canadian Pension Plan, a trustee-managed multiemployer defined benefit pension plan. Our obligation during the term of the collective bargaining agreement was limited to remitting the required contributions to the plan and contributions made were not significant during 2015 through 2016. Savings Plans The Company sponsors several defined contribution plans to provide retirement benefits to employees. Contributions to The Hershey Company 401(k) Plan and similar plans for non-domestic employees are based on a portion of eligible pay up to a defined maximum. All matching contributions were made in cash. Expense associated with the defined contribution plans was $46,154 in 2017 , $43,545 in 2016 and $44,285 in 2015 . |
STOCK COMPENSATION PLANS
STOCK COMPENSATION PLANS | 12 Months Ended |
Dec. 31, 2017 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Stock Compensation Plans | STOCK COMPENSATION PLANS Share-based grants for compensation and incentive purposes are made pursuant to the Equity and Incentive Compensation Plan (“EICP”). The EICP provides for grants of one or more of the following stock-based compensation awards to employees, non-employee directors and certain service providers upon whom the successful conduct of our business is dependent: l Non-qualified stock options (“stock options”); l Performance stock units (“PSUs”) and performance stock; l Stock appreciation rights; l Restricted stock units (“RSUs”) and restricted stock; and l Other stock-based awards. As of December 31, 2017 , 65.8 million shares were authorized and approved by our stockholders for grants under the EICP. The EICP also provides for the deferral of stock-based compensation awards by participants if approved by the Compensation and Executive Organization Committee of our Board and if in accordance with an applicable deferred compensation plan of the Company. Currently, the Compensation and Executive Organization Committee has authorized the deferral of PSU and RSU awards by certain eligible employees under the Company’s Deferred Compensation Plan. Our Board has authorized our non-employee directors to defer any portion of their cash retainer, committee chair fees and RSUs awarded that they elect to convert into deferred stock units under our Directors’ Compensation Plan. At the time stock options are exercised or RSUs and PSUs become payable, common stock is issued from our accumulated treasury shares. Dividend equivalents are credited on RSUs on the same date and at the same rate as dividends are paid on Hershey’s common stock. These dividend equivalents are charged to retained earnings. For the periods presented, compensation expense for all types of stock-based compensation programs and the related income tax benefit recognized were as follows: For the years ended December 31, 2017 2016 2015 Pre-tax compensation expense $ 51,061 $ 54,785 $ 51,533 Related income tax benefit 13,684 17,148 17,109 Compensation costs for stock compensation plans are primarily included in selling, marketing and administrative expense. As of December 31, 2017 , total stock-based compensation cost related to non-vested awards not yet recognized was $62,274 and the weighted-average period over which this amount is expected to be recognized was approximately 2.1 years . Stock Options The exercise price of each stock option awarded under the EICP equals the closing price of our Common Stock on the New York Stock Exchange on the date of grant. Each stock option has a maximum term of 10 years . Grants of stock options provide for pro-rated vesting, typically over a four -year period. Expense for stock options is based on grant date fair value and recognized on a straight-line method over the vesting period, net of estimated forfeitures. A summary of activity relating to grants of stock options for the year ended December 31, 2017 is as follows: Stock Options Shares Weighted-Average Weighted-Average Remaining Aggregate Intrinsic Value Outstanding at beginning of the period 6,192,008 $82.67 6.2 years Granted 1,094,155 $108.06 Exercised (1,133,511 ) $69.64 Forfeited (231,590 ) $103.03 Outstanding as of December 31, 2017 5,921,062 $89.06 5.8 years $ 141,893 Options exercisable as of December 31, 2017 3,699,469 $81.65 4.3 years $ 116,067 The weighted-average fair value of options granted was $15.76 , $11.46 and $18.99 per share in 2017 , 2016 and 2015 , respectively. The fair value was estimated on the date of grant using a Black-Scholes option-pricing model and the following weighted-average assumptions: For the years ended December 31, 2017 2016 2015 Dividend yields 2.4 % 2.4 % 2.1 % Expected volatility 17.2 % 16.8 % 20.7 % Risk-free interest rates 2.2 % 1.5 % 1.9 % Expected term in years 6.8 6.8 6.7 l “Dividend yields” means the sum of dividends declared for the four most recent quarterly periods, divided by the average price of our Common Stock for the comparable periods; l “Expected volatility” means the historical volatility of our Common Stock over the expected term of each grant; l “Risk-free interest rates” means the U.S. Treasury yield curve rate in effect at the time of grant for periods within the contractual life of the stock option; and l “Expected term” means the period of time that stock options granted are expected to be outstanding based primarily on historical data. The total intrinsic value of options exercised was $45,998 , $73,944 and $66,161 in 2017 , 2016 and 2015 , respectively. As of December 31, 2017 , there was $15,849 of total unrecognized compensation cost related to non-vested stock option awards granted under the EICP, which we expect to recognize over a weighted-average period of 2.4 years . The following table summarizes information about stock options outstanding as of December 31, 2017 : Options Outstanding Options Exercisable Range of Exercise Prices Number Weighted- Weighted- Number Weighted- $33.40 - $81.73 1,985,084 3.4 $63.53 1,985,084 $63.53 $81.74 - $105.91 2,060,833 6.9 $97.25 929,199 $99.72 $105.92 - $111.76 1,875,145 7.1 $107.06 785,186 $106.04 $33.40 - $111.76 5,921,062 5.8 $89.06 3,699,469 $81.65 Performance Stock Units and Restricted Stock Units Under the EICP, we grant PSUs to selected executives and other key employees. Vesting is contingent upon the achievement of certain performance objectives. We grant PSUs over 3 -year performance cycles. If we meet targets for financial measures at the end of the applicable 3 -year performance cycle, we award a resulting number of shares of our Common Stock to the participants. For PSUs granted, the target award is a combination of a market-based total shareholder return and performance-based components. The performance scores for 2015 through 2017 grants of PSUs can range from 0% to 250% of the targeted amounts. We recognize the compensation cost associated with PSUs ratably over the 3 -year term. Compensation cost is based on the grant date fair value because the grants can only be settled in shares of our Common Stock. The grant date fair value of PSUs is determined based on the Monte Carlo simulation model for the market-based total shareholder return component and the closing market price of the Company’s Common Stock on the date of grant for performance-based components. In 2017 , 2016 and 2015 , we awarded RSUs to certain executive officers and other key employees under the EICP. We also awarded RSUs quarterly to non-employee directors. We recognize the compensation cost associated with employee RSUs over a specified award vesting period based on the grant date fair value of our Common Stock. We recognize expense for employee RSUs based on the straight-line method. We recognize the compensation cost associated with non-employee director RSUs ratably over the vesting period, net of estimated forfeitures. A summary of activity relating to grants of PSUs and RSUs for the period ended December 31, 2017 is as follows: Performance Stock Units and Restricted Stock Units Number of units Weighted-average grant date fair value for equity awards (per unit) Outstanding at beginning of year 828,228 $102.66 Granted 478,044 $110.97 Performance assumption change 21,305 $96.71 Vested (277,261 ) $109.35 Forfeited (126,952 ) $107.91 Outstanding at end of year 923,364 $103.11 The following table sets forth information about the fair value of the PSUs and RSUs granted for potential future distribution to employees and non-employee directors. In addition, the table provides assumptions used to determine the fair value of the market-based total shareholder return component using the Monte Carlo simulation model on the date of grant. For the years ended December 31, 2017 2016 2015 Units granted 478,044 545,750 381,407 Weighted-average fair value at date of grant $ 110.97 $ 93.55 $ 104.68 Monte Carlo simulation assumptions: Estimated values $ 46.85 $ 38.02 $ 61.22 Dividend yields 2.3 % 2.5 % 2.0 % Expected volatility 20.4 % 17.0 % 14.9 % l “Estimated values” means the fair value for the market-based total shareholder return component of each PSU at the date of grant using a Monte Carlo simulation model; l “Dividend yields” means the sum of dividends declared for the four most recent quarterly periods, divided by the average price of our Common Stock for the comparable periods; l “Expected volatility” means the historical volatility of our Common Stock over the expected term of each grant. The fair value of shares vested totaled $29,981 , $22,062 and $46,113 in 2017 , 2016 and 2015 , respectively. Deferred PSUs, deferred RSUs and deferred stock units representing directors’ fees totaled 369,278 units as of December 31, 2017 . Each unit is equivalent to one share of the Company’s Common Stock. |
SEGMENT INFORMATION
SEGMENT INFORMATION | 12 Months Ended |
Dec. 31, 2017 | |
Segment Reporting [Abstract] | |
Segment Information | SEGMENT INFORMATION Our organizational structure is designed to ensure continued focus on North America, coupled with an emphasis on profitable growth in our focus international markets. Our business is organized around geographic regions, which enables us to build processes for repeatable success in our global markets. As a result, we have defined our operating segments on a geographic basis, as this aligns with how our Chief Operating Decision Maker (“CODM”) manages our business, including resource allocation and performance assessment. Our North America business, which generates approximately 88% of our consolidated revenue, is our only reportable segment. None of our other operating segments meet the quantitative thresholds to qualify as reportable segments; therefore, these operating segments are combined and disclosed below as International and Other. • North America - This segment is responsible for our traditional chocolate and non-chocolate confectionery market position, as well as our grocery and growing snacks market positions, in the United States and Canada. This includes developing and growing our business in chocolate and non-chocolate confectionery, pantry, food service and other snacking product lines. • International and Other - International and Other is a combination of all other operating segments that are not individually material, including those geographic regions where we operate outside of North America. We currently have operations and manufacture product in China, Mexico, Brazil, India and Malaysia, primarily for consumers in these regions, and also distribute and sell confectionery products in export markets of Asia, Latin America, Middle East, Europe, Africa and other regions. This segment also includes our global retail operations, including Hershey's Chocolate World stores in Hershey, Pennsylvania, New York City, Las Vegas, Niagara Falls (Ontario), Dubai, and Singapore, as well as operations associated with licensing the use of certain of the Company's trademarks and products to third parties around the world. For segment reporting purposes, we use “segment income” to evaluate segment performance and allocate resources. Segment income excludes unallocated general corporate administrative expenses, unallocated mark-to-market gains and losses on commodity derivatives, business realignment and impairment charges, acquisition integration costs, the non-service related portion of pension expense and other unusual gains or losses that are not part of our measurement of segment performance. These items of our operating income are managed centrally at the corporate level and are excluded from the measure of segment income reviewed by the CODM as well the measure of segment performance used for incentive compensation purposes. Accounting policies associated with our operating segments are generally the same as those described in Note 1. Certain manufacturing, warehousing, distribution and other activities supporting our global operations are integrated to maximize efficiency and productivity. As a result, assets and capital expenditures are not managed on a segment basis and are not included in the information reported to the CODM for the purpose of evaluating performance or allocating resources. We disclose depreciation and amortization that is generated by segment-specific assets, since these amounts are included within the measure of segment income reported to the CODM. Our segment net sales and earnings were as follows: For the years ended December 31, 2017 2016 2015 Net sales: North America $ 6,621,173 $ 6,532,988 $ 6,468,158 International and Other 894,253 907,193 918,468 Total $ 7,515,426 $ 7,440,181 $ 7,386,626 Segment income (loss): North America $ 2,045,550 $ 2,040,995 $ 2,073,967 International and Other 11,532 (29,139 ) (98,067 ) Total segment income 2,057,082 2,011,856 1,975,900 Unallocated corporate expense (1) 504,323 497,423 497,386 Unallocated mark-to-market (gains) losses on commodity derivatives (35,292 ) 163,238 — Goodwill, indefinite and long-lived asset impairment charges 208,712 4,204 280,802 Costs associated with business realignment activities 69,359 107,571 120,975 Non-service related pension expense 35,028 27,157 18,079 Acquisition and integration costs 311 6,480 20,899 Operating profit 1,274,641 1,205,783 1,037,759 Interest expense, net 98,282 90,143 105,773 Other (income) expense, net 65,691 16,159 30,139 Income before income taxes $ 1,110,668 $ 1,099,481 $ 901,847 (1) Includes centrally-managed (a) corporate functional costs relating to legal, treasury, finance, and human resources, (b) expenses associated with the oversight and administration of our global operations, including warehousing, distribution and manufacturing, information systems and global shared services, (c) non-cash stock-based compensation expense, and (d) other gains or losses that are not integral to segment performance. Activity within the unallocated mark-to-market (gains) losses on commodity derivatives is as follows: For the years ended December 31, 2017 2016 Net losses on mark-to-market valuation of commodity derivative positions recognized in income $ 55,734 $ 171,753 Net losses on commodity derivative positions reclassified from unallocated to segment income (91,026 ) (8,515 ) Net (gains) losses on mark-to-market valuation of commodity derivative positions recognized in unallocated derivative (gains) losses $ (35,292 ) $ 163,238 As of December 31, 2017 , the cumulative amount of mark-to-market losses on commodity derivatives that have been recognized in our consolidated cost of sales and not yet allocated to reportable segments was $127,946 . Based on our forecasts of the timing of the recognition of the underlying hedged items, we expect to reclassify net pretax losses on commodity derivatives of $94,449 to segment operating results in the next twelve months. Depreciation and amortization expense included within segment income presented above is as follows: For the years ended December 31, 2017 2016 2015 North America $ 171,265 $ 162,211 $ 153,185 International and Other 42,542 50,753 46,342 Corporate (1) 48,046 88,873 45,401 Total $ 261,853 $ 301,837 $ 244,928 (1) Corporate includes non-cash asset-related accelerated depreciation and amortization related to business realignment activities, as discussed in Note 7. Such amounts are not included within our measure of segment income. Additional geographic information is as follows: 2017 2016 2015 Net sales: United States $ 6,263,703 $ 6,196,723 $ 6,116,490 Other 1,251,723 1,243,458 1,270,136 Total $ 7,515,426 $ 7,440,181 $ 7,386,626 Long-lived assets: United States $ 1,575,496 $ 1,528,255 $ 1,528,723 Other 531,201 648,993 711,737 Total $ 2,106,697 $ 2,177,248 $ 2,240,460 |
EQUITY AND NONCONTROLLING INTER
EQUITY AND NONCONTROLLING INTEREST | 12 Months Ended |
Dec. 31, 2017 | |
Equity [Abstract] | |
Equity and Noncontrolling Interest | EQUITY AND NONCONTROLLING INTEREST We had 1,055,000,000 authorized shares of capital stock as of December 31, 2017 . Of this total, 900,000,000 shares were designated as Common Stock, 150,000,000 shares were designated as Class B Stock and 5,000,000 shares were designated as Preferred Stock. Each class has a par value of one dollar per share. Holders of the Common Stock and the Class B Stock generally vote together without regard to class on matters submitted to stockholders, including the election of directors. The holders of Common Stock have 1 vote per share and the holders of Class B Stock have 10 votes per share. However, the Common Stock holders, voting separately as a class, are entitled to elect one-sixth of the Board. With respect to dividend rights, the Common Stock holders are entitled to cash dividends 10% higher than those declared and paid on the Class B Stock. Class B Stock can be converted into Common Stock on a share-for-share basis at any time. During 2017 , 2016 , and 2015 no shares of Class B Stock were converted into Common Stock. Changes in the outstanding shares of Common Stock for the past three years were as follows: For the years ended December 31, 2017 2016 2015 Shares issued 359,901,744 359,901,744 359,901,744 Treasury shares at beginning of year (147,642,009 ) (143,124,384 ) (138,856,786 ) Stock repurchases: Shares repurchased in the open market under pre-approved share repurchase programs — (4,640,964 ) (4,209,112 ) Milton Hershey School Trust repurchase (1,500,000 ) — — Shares repurchased to replace Treasury Stock issued for stock options and incentive compensation (1,278,675 ) (1,820,766 ) (1,776,838 ) Stock issuances: Shares issued for stock options and incentive compensation 1,379,757 1,944,105 1,718,352 Treasury shares at end of year (149,040,927 ) (147,642,009 ) (143,124,384 ) Net shares outstanding at end of year 210,860,817 212,259,735 216,777,360 We are authorized to purchase our outstanding shares in open market and privately negotiated transactions. The programs have no expiration date and acquired shares of Common Stock will be held as treasury shares. Purchases under approved share repurchase authorizations are in addition to our practice of buying back shares sufficient to offset those issued under incentive compensation plans. Hershey Trust Company Hershey Trust Company, as trustee for the Milton Hershey School Trust (the "Trust") and as direct owner of investment shares, held 8,403,121 shares of our Common Stock as of December 31, 2017 . As trustee for the Trust, Hershey Trust Company held 60,612,012 shares of the Class B Stock as of December 31, 2017 , and was entitled to cast approximately 80% of all of the votes entitled to be cast on matters requiring the vote of both classes of our common stock voting together. Hershey Trust Company, as trustee for the Trust, or any successor trustee, or Milton Hershey School, as appropriate, must approve any issuance of shares of Common Stock or other action that would result in it not continuing to have voting control of our Company. In August 2017, the Company entered into a Stock Purchase Agreement with Hershey Trust Company, as trustee for the Trust, pursuant to which the Company agreed to purchase 1,500,000 shares of the Company’s common stock from the Trust at a price equal to $106.01 per share, for a total purchase price of $159,015 . Noncontrolling Interest in Subsidiary We currently own a 50% controlling interest in Lotte Shanghai Foods Co., Ltd. (“LSFC”), a joint venture established in 2007 in China for the purpose of manufacturing and selling product to the venture partners. A roll-forward showing the 2017 activity relating to the noncontrolling interest follows: Noncontrolling Interest Balance, December 31, 2016 $ 41,831 Net loss attributable to noncontrolling interest (26,444 ) Other comprehensive income - foreign currency translation adjustments 840 Balance, December 31, 2017 $ 16,227 The 2017 net loss attributable to the noncontrolling interest reflects the 50% allocation of LSFC-related business realignment and impairment costs (see Note 7). The 2016 net loss attributable to noncontrolling interests totaled $3,970 , which was presented within selling, marketing and administrative expense in the Consolidated Statements of Income since the amount was not considered significant. |
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 12 Months Ended |
Dec. 31, 2017 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | COMMITMENTS AND CONTINGENCIES Purchase obligations We enter into certain obligations for the purchase of raw materials. These obligations are primarily in the form of forward contracts for the purchase of raw materials from third-party brokers and dealers. These contracts minimize the effect of future price fluctuations by fixing the price of part or all of these purchase obligations. Total obligations consisted of fixed price contracts for the purchase of commodities and unpriced contracts that were valued using market prices as of December 31, 2017 . The cost of commodities associated with the unpriced contracts is variable as market prices change over future periods. We mitigate the variability of these costs to the extent that we have entered into commodities futures contracts or other commodity derivative instruments to hedge our costs for those periods. Increases or decreases in market prices are offset by gains or losses on commodities futures contracts or other commodity derivative instruments. Taking delivery of and making payments for the specific commodities for use in the manufacture of finished goods satisfies our obligations under the forward purchase contracts. For each of the three years in the period ended December 31, 2017 , we satisfied these obligations by taking delivery of and making payment for the specific commodities. As of December 31, 2017 , we had entered into agreements for the purchase of raw materials with various suppliers. Subject to meeting our quality standards, the purchase obligations covered by these agreements were as follows as of December 31, 2017 : in millions 2018 2019 2020 2021 2022 Purchase obligations $ 1,359.7 $ 272.3 $ 11.4 $ 2.5 $ 0.7 Lease commitments We also have commitments under various operating and capital lease arrangements. Future minimum payments under lease arrangements with a remaining term in excess of one year were as follows as of December 31, 2017 : Operating leases (1) Capital leases (2) 2018 $ 16,241 $ 3,401 2019 16,784 3,469 2020 14,763 3,538 2021 12,914 3,609 2022 11,267 4,216 Thereafter 182,368 175,313 (1) Future minimum rental payments reflect commitments under non-cancelable operating leases primarily for offices, retail stores, warehouse and distribution facilities. Total rent expense for the years ended December 31, 2017 , 2016 and 2015 was $25,525 , $20,330 and $19,754 , respectively, including short-term rentals. (2) Future minimum rental payments reflect commitments under non-cancelable capital leases primarily for offices and warehouse facilities. Environmental contingencies We have a number of facilities that contain varying amounts of asbestos in certain locations within the facilities. Our asbestos management program is compliant with current applicable regulations, which require that we handle or dispose of asbestos in a special manner if such facilities undergo major renovations or are demolished. We do not have sufficient information to estimate the fair value of any asset retirement obligations related to these facilities. We cannot specify the settlement date or range of potential settlement dates and, therefore, sufficient information is not available to apply an expected present value technique. We expect to maintain the facilities with repairs and maintenance activities that would not involve or require the removal of significant quantities of asbestos. Legal contingencies We are subject to various pending or threatened legal proceedings and claims that arise in the ordinary course of our business. While it is not feasible to predict or determine the outcome of such proceedings and claims with certainty, in our opinion these matters, both individually and in the aggregate, are not expected to have a material effect on our financial condition, results of operations or cash flows. Collective Bargaining As of December 31, 2017 , the Company employed approximately 15,360 full-time and 1,550 part-time employees worldwide. Collective bargaining agreements covered approximately 5,450 employees, or approximately 32% of the Company’s employees worldwide. During 2018, agreements will be negotiated for certain employees at four facilities outside of the United States, comprising approximately 72% of total employees under collective bargaining agreements. We currently expect that we will be able to renegotiate such agreements on satisfactory terms when they expire. |
EARNINGS PER SHARE
EARNINGS PER SHARE | 12 Months Ended |
Dec. 31, 2017 | |
Earnings Per Share [Abstract] | |
Earnings Per Share | EARNINGS PER SHARE We compute basic earnings per share for Common Stock and Class B common stock using the two-class method. The Class B common stock is convertible into Common Stock on a share-for-share basis at any time. The computation of diluted earnings per share for Common Stock assumes the conversion of Class B common stock using the if-converted method, while the diluted earnings per share of Class B common stock does not assume the conversion of those shares. We compute basic and diluted earnings per share based on the weighted-average number of shares of Common Stock and Class B common stock outstanding as follows: For the years ended December 31, 2017 2016 2015 Common Stock Class B Common Stock Common Stock Class B Common Stock Common Stock Class B Common Stock Basic earnings per share: Numerator: Allocation of distributed earnings (cash dividends paid) $ 385,878 $ 140,394 $ 367,081 $ 132,394 $ 352,953 $ 123,179 Allocation of undistributed earnings 188,286 68,423 162,299 58,270 27,324 9,495 Total earnings—basic $ 574,164 $ 208,817 $ 529,380 $ 190,664 $ 380,277 $ 132,674 Denominator (shares in thousands): Total weighted-average shares—basic 151,625 60,620 153,519 60,620 158,471 60,620 Earnings Per Share—basic $ 3.79 $ 3.44 $ 3.45 $ 3.15 $ 2.40 $ 2.19 Diluted earnings per share: Numerator: Allocation of total earnings used in basic computation $ 574,164 $ 208,817 $ 529,380 $ 190,664 $ 380,277 $ 132,674 Reallocation of total earnings as a result of conversion of Class B common stock to Common stock 208,817 — 190,664 — 132,674 — Reallocation of undistributed earnings — (492 ) — (324 ) — (69 ) Total earnings—diluted $ 782,981 $ 208,325 $ 720,044 $ 190,340 $ 512,951 $ 132,605 Denominator (shares in thousands): Number of shares used in basic computation 151,625 60,620 153,519 60,620 158,471 60,620 Weighted-average effect of dilutive securities: Conversion of Class B common stock to Common shares outstanding 60,620 — 60,620 — 60,620 — Employee stock options 1,144 — 964 — 1,335 — Performance and restricted stock units 353 — 201 — 225 — Total weighted-average shares—diluted 213,742 60,620 215,304 60,620 220,651 60,620 Earnings Per Share—diluted $ 3.66 $ 3.44 $ 3.34 $ 3.14 $ 2.32 $ 2.19 The earnings per share calculations for the years ended December 31, 2017 , 2016 and 2015 excluded 2,374 , 3,680 and 2,660 stock options (in thousands), respectively, that would have been antidilutive. |
OTHER (INCOME) EXPENSE, NET OTH
OTHER (INCOME) EXPENSE, NET OTHER (INCOME) EXPENSE, NET | 12 Months Ended |
Dec. 31, 2017 | |
Other Income and Expenses [Abstract] | |
Other (Income) Expense, Net | OTHER (INCOME) EXPENSE, NET Other (income) expense, net reports certain gains and losses associated with activities not directly related to our core operations. A summary of the components of other (income) expense, net is as follows: For the years ended December 31, 2017 2016 2015 Write-down of equity investments in partnerships qualifying for tax credits $ 66,209 $ 43,482 $ 39,489 Settlement of SGM liability (see Note 2) — (26,650 ) — Gain on sale of non-core trademark — — (9,950 ) Other (income) expense, net (518 ) (673 ) 600 Total $ 65,691 $ 16,159 $ 30,139 |
SUPPLEMENTAL BALANCE SHEET INFO
SUPPLEMENTAL BALANCE SHEET INFORMATION | 12 Months Ended |
Dec. 31, 2017 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Supplemental Balance Sheet Information | SUPPLEMENTAL BALANCE SHEET INFORMATION The components of certain Consolidated Balance Sheet accounts are as follows: December 31, 2017 2016 Inventories: Raw materials $ 224,940 $ 315,239 Goods in process 93,627 88,490 Finished goods 614,945 528,587 Inventories at FIFO 933,512 932,316 Adjustment to LIFO (180,676 ) (186,638 ) Total inventories $ 752,836 $ 745,678 Property, plant and equipment: Land $ 108,300 $ 103,865 Buildings 1,214,158 1,238,634 Machinery and equipment 2,925,353 3,001,552 Construction in progress 212,912 230,987 Property, plant and equipment, gross 4,460,723 4,575,038 Accumulated depreciation (2,354,026 ) (2,397,790 ) Property, plant and equipment, net $ 2,106,697 $ 2,177,248 Other assets: Capitalized software, net $ 104,881 $ 95,301 Income tax receivable — 1,449 Other non-current assets 146,998 71,615 Total other assets $ 251,879 $ 168,365 Accrued liabilities: Payroll, compensation and benefits $ 190,863 $ 240,080 Advertising and promotion 305,107 358,573 Other 180,164 152,333 Total accrued liabilities $ 676,134 $ 750,986 Other long-term liabilities: Post-retirement benefits liabilities $ 215,320 $ 220,270 Pension benefits liabilities 39,410 65,687 Other 184,209 114,204 Total other long-term liabilities $ 438,939 $ 400,161 Accumulated other comprehensive loss: Foreign currency translation adjustments $ (91,837 ) $ (110,613 ) Pension and post-retirement benefit plans, net of tax (169,526 ) (207,169 ) Cash flow hedges, net of tax (52,383 ) (58,106 ) Total accumulated other comprehensive loss $ (313,746 ) $ (375,888 ) |
QUARTERLY DATA (Unaudited)
QUARTERLY DATA (Unaudited) | 12 Months Ended |
Dec. 31, 2017 | |
Quarterly Financial Information Disclosure [Abstract] | |
Quarterly Data (Unaudited) | QUARTERLY DATA (Unaudited) Summary quarterly results were as follows: Year 2017 First Second Third Fourth Net sales $ 1,879,678 $ 1,662,991 $ 2,033,121 $ 1,939,636 Gross profit 906,560 763,210 940,222 834,527 Net income attributable to The Hershey Company 125,044 203,501 273,303 181,133 Common stock: Net income per share—Basic (a) 0.60 0.98 1.32 0.88 Net income per share—Diluted (a) 0.58 0.95 1.28 0.85 Dividends paid per share 0.618 0.618 0.656 0.656 Class B common stock: Net income per share—Basic (a) 0.55 0.89 1.20 0.80 Net income per share—Diluted (a) 0.55 0.89 1.20 0.80 Dividends paid per share 0.562 0.562 0.596 0.596 Market price—common stock: High 109.61 115.96 110.50 115.45 Low 103.45 106.41 104.06 102.87 Year 2016 First Second Third Fourth Net sales $ 1,828,812 $ 1,637,671 $ 2,003,454 $ 1,970,244 Gross profit 817,376 747,398 850,848 742,269 Net income attributable to The Hershey Company 229,832 145,956 227,403 116,853 Common stock: Net income per share—Basic (a) 1.09 0.70 1.09 0.56 Net income per share—Diluted (a) 1.06 0.68 1.06 0.55 Dividends paid per share 0.583 0.583 0.618 0.618 Class B common stock: Net income per share—Basic (a) 0.99 0.64 0.99 0.51 Net income per share—Diluted (a) 0.99 0.64 0.99 0.51 Dividends paid per share 0.530 0.530 0.562 0.562 Market price—common stock: High 93.71 113.49 113.89 104.44 Low 83.32 89.60 94.64 94.63 (a) Quarterly income per share amounts do not total to the annual amount due to changes in weighted-average shares outstanding during the year. |
SUBSEQUENT EVENTS SUBSEQUENT EV
SUBSEQUENT EVENTS SUBSEQUENT EVENTS | 12 Months Ended |
Dec. 31, 2017 | |
Subsequent Events [Abstract] | |
Subsequent Events [Text Block] | SUBSEQUENT EVENTS Short-term Debt On January 8, 2018, we entered into an additional credit facility under which the Company may borrow up to $1.5 billion on an unsecured, revolving basis. Funds borrowed may be used for general corporate purposes, including commercial paper backstop and acquisitions. This facility is scheduled to expire on January 7, 2019. Business Acquisition On January 31, 2018, we completed the acquisition of all of the outstanding shares of Amplify Snack Brands, Inc. (“Amplify”), a publicly traded company based in Austin, Texas that owns several popular better-for-you snack brands such as SkinnyPop , Oatmega , Paqui and Tyrrells . Amplify's anchor brand, SkinnyPop , is a market-leading ready-to-eat popcorn brand and is available in a wide range of food distribution channels in the United States. The business enables us to capture more consumer snacking occasions by creating a broader portfolio of brands and is expected to generate 2018 post-acquisition net sales of approximately $375,000 to $385,000 . The purchase consideration for the outstanding shares totaled approximately $908,000 , or $12.00 per outstanding share. In connection with acquisition, the Company paid a total amount of approximately $607,000 to pay in full all outstanding debt owed by Amplify under its existing credit agreement as of January 31, 2018. Funding for the acquisition and repayment of the acquired debt consisted of cash borrowings under the Company's new revolving credit facility. We are currently in the process of determining the allocation of the purchase price, which will include the recognition of identifiable intangible assets and goodwill. We anticipate that the value of Amplify's acquired net assets will be minimal. Goodwill is being determined as the excess of the purchase price over the fair value of the net assets acquired (including the identifiable intangible assets) and is not expected to be deductible for tax purposes. The goodwill that will result from the acquisition is attributable primarily to cost-reduction synergies as Amplify leverages Hershey's resources, expertise and capability-building. |
SCHEDULE II - VALUATION AND QUA
SCHEDULE II - VALUATION AND QUALIFYING ACCOUNTS | 12 Months Ended |
Dec. 31, 2017 | |
Valuation and Qualifying Accounts [Abstract] | |
Schedule II - Valuation and Qualifying Accounts | SCHEDULE II—VALUATION AND QUALIFYING ACCOUNTS For the Years Ended December 31, 2017 , 2016 and 2015 Additions Description Balance at Beginning of Period Charged to Costs and Expenses Charged Deductions Balance of Period In thousands of dollars For the year ended December 31, 2017 Allowances deducted from assets Accounts receivable—trade, net (a) $ 40,153 $ 166,993 $ — $ (165,354 ) $ 41,792 Valuation allowance on net deferred taxes (b) 235,485 92,139 — (15,476 ) 312,148 Inventory obsolescence reserve (c) 20,043 35,666 — (36,361 ) 19,348 Total allowances deducted from assets $ 295,681 $ 294,798 $ — $ (217,191 ) $ 373,288 For the year ended December 31, 2016 Allowances deducted from assets Accounts receivable—trade, net (a) $ 32,638 $ 174,314 $ — $ (166,799 ) $ 40,153 Valuation allowance on net deferred taxes (b) 207,055 28,430 — — 235,485 Inventory obsolescence reserve (c) 22,632 30,053 — (32,642 ) 20,043 Total allowances deducted from assets $ 262,325 $ 232,797 $ — $ (199,441 ) $ 295,681 For the year ended December 31, 2015 Allowances deducted from assets Accounts receivable—trade, net (a) $ 15,885 $ 172,622 $ — $ (155,869 ) $ 32,638 Valuation allowance on net deferred taxes (b) 147,223 59,832 — — 207,055 Inventory obsolescence reserve (c) 11,748 32,434 — (21,550 ) 22,632 Total allowances deducted from assets $ 174,856 $ 264,888 $ — $ (177,419 ) $ 262,325 (a) Includes allowances for doubtful accounts, anticipated discounts and write-offs of uncollectible accounts receivable. (b) Includes adjustments to the valuation allowance for deferred tax assets that we do not expect to realize. The 2017 deductions from reserves reflects the change in valuation allowance due to the remeasurement of corresponding U.S. deferred tax assets at the lower enacted corporate tax rates resulting from the U.S. tax reform. (c) Includes adjustments to the inventory reserve, transfers, disposals and write-offs of obsolete inventory. |
SUMMARY OF SIGNIFICANT ACCOUN28
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 12 Months Ended |
Dec. 31, 2017 | |
Accounting Policies [Abstract] | |
Description of Business and Basis of Presentation | Description of Business The Hershey Company together with its wholly-owned subsidiaries and entities in which it has a controlling interest,(the “Company,” “Hershey,” “we” or “us”) is a global confectionery leader known for its branded portfolio of chocolate, sweets, mints and other great-tasting snacks. The Company has more than 80 brands worldwide including such iconic brand names as Hershey’s, Reese’s, Kisses, Jolly Rancher and Ice Breakers, which are marketed, sold and distributed in approximately 80 countries worldwide. Hershey is focused on growing its presence in key international markets while continuing to build its competitive advantage in North America. The Company currently operates through two reportable segments that are aligned with its management structure and the key markets it serves: North America and International and Other. For additional information on our segment presentation, see Note 11. Basis of Presentation Our consolidated financial statements include the accounts of The Hershey Company and its majority-owned or controlled subsidiaries. Intercompany transactions and balances have been eliminated. We have a controlling financial interest if we own a majority of the outstanding voting common stock and minority shareholders do not have substantive participating rights, we have significant control through contractual or economic interests in which we are the primary beneficiary or we have the power to direct the activities that most significantly impact the entity's economic performance. Net income (loss) attributable to noncontrolling interests in 2016 and 2015 was not considered significant and was recorded within selling, marketing and administrative expense in the Consolidated Statements of Income. See Note 12 for additional information on our noncontrolling interest. We use the equity method of accounting when we have a 20% to 50% interest in other companies and exercise significant influence. In addition, we use the equity method of accounting for our investments in partnership entities which make equity investments in projects eligible to receive federal historic and energy tax credits. See Note 8 for additional information on our equity investments in partnership entities qualifying for tax credits. |
Use of Estimates | Use of Estimates The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America (“GAAP”) requires management to make estimates and assumptions that affect the amounts reported in the consolidated financial statements and accompanying disclosures. Our significant estimates and assumptions include, among others, pension and other post-retirement benefit plan assumptions, valuation assumptions of goodwill and other intangible assets, useful lives of long-lived assets, marketing and trade promotion accruals and income taxes. These estimates and assumptions are based on management’s best judgment. Management evaluates its estimates and assumptions on an ongoing basis using historical experience and other factors, including the current economic environment, and the effects of any revisions are reflected in the consolidated financial statements in the period that they are determined. As future events and their effects cannot be determined with precision, actual results could differ significantly from these estimates. |
Revenue Recognition | Revenue Recognition We record sales when all of the following criteria have been met: l A valid customer order with a fixed price has been received; l The product has been delivered to the customer; l There is no further significant obligation to assist in the resale of the product; and l Collectability is reasonably assured. Net sales include revenue from the sale of finished goods and royalty income, net of allowances for trade promotions, consumer coupon programs and other sales incentives, and allowances and discounts associated with aged or potentially unsaleable products. Trade promotions and sales incentives primarily include reduced price features, merchandising displays, sales growth incentives, new item allowances and cooperative advertising. Sales, use, value-added and other excise taxes are not recognized in revenue. In 2017 , 2016 and 2015 , approximately 29% , 25% and 26% , respectively, of our consolidated net sales were made to McLane Company, Inc., one of the largest wholesale distributors in the United States to convenience stores, drug stores, wholesale clubs and mass merchandisers and the primary distributor of our products to Wal-Mart Stores, Inc. |
Cost of Sales | Cost of Sales Cost of sales represents costs directly related to the manufacture and distribution of our products. Primary costs include raw materials, packaging, direct labor, overhead, shipping and handling, warehousing and the depreciation of manufacturing, warehousing and distribution facilities. Manufacturing overhead and related expenses include salaries, wages, employee benefits, utilities, maintenance and property taxes. |
Selling, Marketing and Administrative Expense | Selling, Marketing and Administrative Expense Selling, marketing and administrative expense (“SM&A”) represents costs incurred in generating revenues and in managing our business. Such costs include advertising and other marketing expenses, selling expenses, research and development, administrative and other indirect overhead costs, amortization of capitalized software and intangible assets and depreciation of administrative facilities. Research and development costs, charged to expense as incurred, totaled $45,850 in 2017 , $47,268 in 2016 and $49,281 in 2015 . Advertising expense is also charged to expense as incurred and totaled $541,293 in 2017 , $521,479 in 2016 and $561,644 in 2015 . Prepaid advertising expense was $56 and $651 as of December 31, 2017 and 2016 , respectively. |
Cash Equivalents | Cash Equivalents Cash equivalents consist of highly liquid debt instruments, time deposits and money market funds with original maturities of three months or less. The fair value of cash and cash equivalents approximates the carrying amount. |
Short-term Investments | Short-term Investments Short-term investments consist of bank term deposits that have original maturity dates ranging from greater than three months to twelve months. Short-term investments are carried at cost, which approximates fair value. |
Accounts Receivable - Trade | Accounts Receivable—Trade In the normal course of business, we extend credit to customers that satisfy pre-defined credit criteria, based upon the results of our recurring financial account reviews and our evaluation of current and projected economic conditions. Our primary concentrations of credit risk are associated with McLane Company, Inc. and Target Corporation, two customers served principally by our North America segment. As of December 31, 2017 , McLane Company, Inc. accounted for approximately 24% of our total accounts receivable. Target Corporation accounted for approximately 11% of our total accounts receivable as of December 31, 2017 . No other customer accounted for more than 10% of our year-end accounts receivable. We believe that we have little concentration of credit risk associated with the remainder of our customer base. Accounts receivable-trade in the Consolidated Balance Sheets is presented net of allowances for bad debts and anticipated discounts of $41,792 and $40,153 at December 31, 2017 and 2016 , respectively. |
Inventories | Inventories Inventories are valued at the lower of cost or market value, adjusted for the value of inventory that is estimated to be excess, obsolete or otherwise unsaleable. As of December 31, 2017 , approximately 59% of our inventories, representing the majority of our U.S. inventories, were valued under the last-in, first-out (“LIFO”) method. The remainder of our inventories in the U.S. and inventories for our international businesses are valued at the lower of first-in, first-out (“FIFO”) cost or market. LIFO cost of inventories valued using the LIFO method was $443,492 as of December 31, 2017 and $402,919 as of December 31, 2016 . The adjustment to LIFO, as shown in Note 16, approximates the excess of replacement cost over the stated LIFO inventory value. The net impact of LIFO acquisitions and liquidations was not material to 2017 , 2016 or 2015 . |
Property, Plant and Equipment | Property, Plant and Equipment Property, plant and equipment is stated at cost and depreciated on a straight-line basis over the estimated useful lives of the assets, as follows: 3 to 15 years for machinery and equipment; and 25 to 40 years for buildings and related improvements. At December 31, 2017 and December 31, 2016 , property, plant and equipment includes assets under capital lease arrangements with net book values totaling $116,843 and $104,503 , respectively. Total depreciation expense for the years ended December 31, 2017 , 2016 and 2015 was $211,592 , $231,735 and $197,054 , respectively, and includes depreciation on assets recorded under capital lease arrangements. Maintenance and repairs are expensed as incurred. We capitalize applicable interest charges incurred during the construction of new facilities and production lines and amortize these costs over the assets’ estimated useful lives. We review long-lived assets for impairment whenever events or changes in circumstances indicate that the carrying amount of such assets may not be recoverable. We measure the recoverability of assets to be held and used by a comparison of the carrying amount of long-lived assets to future undiscounted net cash flows expected to be generated. If these assets are considered to be impaired, we measure impairment as the amount by which the carrying amount of the assets exceeds the fair value of the assets. We report assets held for sale or disposal at the lower of the carrying amount or fair value less cost to sell. We assess asset retirement obligations on a periodic basis and recognize the fair value of a liability for an asset retirement obligation in the period in which it is incurred if a reasonable estimate of fair value can be made. We capitalize associated asset retirement costs as part of the carrying amount of the long-lived asset. |
Computer Software | Computer Software We capitalize costs associated with software developed or obtained for internal use when both the preliminary project stage is completed and it is probable the software being developed will be completed and placed in service. Capitalized costs include only (i) external direct costs of materials and services consumed in developing or obtaining internal-use software, (ii) payroll and other related costs for employees who are directly associated with and who devote time to the internal-use software project and (iii) interest costs incurred, when material, while developing internal-use software. We cease capitalization of such costs no later than the point at which the project is substantially complete and ready for its intended purpose. The unamortized amount of capitalized software totaled $104,881 and $95,301 at December 31, 2017 and 2016 , respectively. We amortize software costs using the straight-line method over the expected life of the software, generally 3 to 7 years. Accumulated amortization of capitalized software was $296,042 and $322,807 as of December 31, 2017 and 2016 , respectively. Such amounts are recorded within other assets in the Consolidated Balance Sheets. We review the carrying value of software and development costs for impairment in accordance with our policy pertaining to the impairment of long-lived assets. |
Goodwill and Other Intangible Assets | Goodwill and Other Intangible Assets Goodwill and indefinite-lived intangible assets are not amortized, but are evaluated for impairment annually or more often if indicators of a potential impairment are present. Our annual impairment tests are conducted at the beginning of the fourth quarter. We test goodwill for impairment by performing either a qualitative or quantitative assessment. If we choose to perform a qualitative assessment, we evaluate economic, industry and company-specific factors in assessing the fair value of the related reporting unit. If we determine that it is more likely than not that the fair value of the reporting unit is less than its carrying value, a quantitative test is then performed. Otherwise, no further testing is required. For those reporting units tested using a quantitative approach, we compare the fair value of each reporting unit with the carrying amount of the reporting unit, including goodwill. If the estimated fair value of the reporting unit is less than the carrying amount of the reporting unit, impairment is indicated, requiring recognition of a goodwill impairment charge for the differential (up to the carrying value of goodwill). We test individual indefinite-lived intangible assets by comparing the estimated fair values with the book values of each asset. We determine the fair value of our reporting units and indefinite-lived intangible assets using an income approach. Under the income approach, we calculate the fair value of our reporting units and indefinite-lived intangible assets based on the present value of estimated future cash flows. Considerable management judgment is necessary to evaluate the impact of operating and macroeconomic changes and to estimate the future cash flows used to measure fair value. Our estimates of future cash flows consider past performance, current and anticipated market conditions and internal projections and operating plans which incorporate estimates for sales growth and profitability, and cash flows associated with taxes and capital spending. Additional assumptions include forecasted growth rates, estimated discount rates, which may be risk-adjusted for the operating market of the reporting unit, and estimated royalty rates that would be charged for comparable branded licenses. We believe such assumptions also reflect current and anticipated market conditions and are consistent with those that would be used by other marketplace participants for similar valuation purposes. Such assumptions are subject to change due to changing economic and competitive conditions. See Note 3 for additional information regarding the results of impairment tests. The cost of intangible assets with finite useful lives is amortized on a straight-line basis. Our finite-lived intangible assets consist primarily of certain trademarks, customer-related intangible assets and patents obtained through business acquisitions, which are amortized over estimated useful lives of approximately 25 years , 15 years , and 5 years , respectively. If certain events or changes in operating conditions indicate that the carrying value of these assets, or related asset groups, may not be recoverable, we perform an impairment assessment and may adjust the remaining useful lives. |
Currency Translation | Currency Translation The financial statements of our foreign entities with functional currencies other than the U.S. dollar are translated into U.S. dollars, with the resulting translation adjustments recorded as a component of other comprehensive income (loss). Assets and liabilities are translated into U.S. dollars using the exchange rates in effect at the balance sheet date, while income and expense items are translated using the average exchange rates during the period. |
Derivative Instruments | Derivative Instruments We use derivative instruments principally to offset exposure to market risks arising from changes in commodity prices, foreign currency exchange rates and interest rates. See Note 5 for additional information on our risk management strategy and the types of instruments we use. Derivative instruments are recognized on the balance sheet at their fair values. When we become party to a derivative instrument and intend to apply hedge accounting, we designate the instrument for financial reporting purposes as a cash flow or fair value hedge. The accounting for changes in fair value (gains or losses) of a derivative instrument depends on whether we have designated it and it qualified as part of a hedging relationship, as noted below: • Changes in the fair value of a derivative that is designated as a cash flow hedge are recorded in accumulated other comprehensive income (“AOCI”) to the extent effective and reclassified into earnings in the same period or periods during which the transaction hedged by that derivative also affects earnings. • Changes in the fair value of a derivative that is designated as a fair value hedge, along with the offsetting loss or gain on the hedged asset or liability that is attributable to the risk being hedged, are recorded in earnings, thereby reflecting in earnings the net extent to which the hedge is not effective in achieving offsetting changes in fair value. • Changes in the fair value of a derivative not designated as a hedging instrument are recognized in earnings in cost of sales or SM&A, consistent with the related exposure. For derivatives designated as hedges, we assess, both at the hedge's inception and on an ongoing basis, whether they are highly effective in offsetting changes in fair values or cash flows of hedged items. The ineffective portion, if any, is recorded directly in earnings. In addition, if we determine that a derivative is not highly effective as a hedge or that it has ceased to be a highly effective hedge, we discontinue hedge accounting prospectively. We do not hold or issue derivative instruments for trading or speculative purposes and are not a party to any instruments with leverage or prepayment features. Cash flows related to the derivative instruments we use to manage interest, commodity or other currency exposures are classified as operating activities. |
Reclassifications | Reclassifications Certain prior period amounts have been reclassified to conform to current year presentation. Specifically, this includes amounts reclassified to conform to the current year presentation in the Consolidated Statements of Cash Flows. |
Recent Accounting Pronouncements | Recent Accounting Pronouncements Recently Adopted Accounting Pronouncements In March 2016, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2016-09, Compensation—Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting . We adopted the provisions of this ASU in the first quarter of 2017. This update principally affects the recognition of excess tax benefits and deficiencies and the cash flow classification of share-based compensation-related transactions. The requirement to recognize excess tax benefits and deficiencies as income tax expense or benefit in the income statement was applied prospectively, with a benefit of $11,745 recognized during the year ended December 31, 2017 . Additionally, within the Consolidated Statement of Cash Flows, the impact of the adoption resulted in a $24,901 increase in net cash flow from operating activities and a corresponding decrease in net cash flow from financing activities for the year ended December 31, 2017 . These classification requirements were adopted retrospectively to the Consolidated Statement of Cash Flows. As a result, for the year ended December 31, 2016 , the impact resulted in a $29,953 increase in net cash flow from operating activities and a corresponding $29,953 decrease in net cash flow from financing activities. For the year ended December 31, 2015 , the impact resulted in a $41,855 increase in net cash flow from operating activities and a corresponding $41,855 decrease in net cash flow from financing activities. In January 2017, the FASB issued ASU No. 2017-04, Intangibles-Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment . This ASU eliminated Step 2 from the goodwill impairment test, which required a hypothetical purchase price allocation. A goodwill impairment will now be the amount by which a reporting unit’s carrying value exceeds its fair value. ASU 2017-04 is effective for annual or any interim goodwill impairment tests in fiscal years beginning after December 15, 2019. Entities are permitted to adopt the standard early for interim or annual goodwill impairment tests performed on testing dates after January 1, 2017. We early-adopted the provisions of this ASU in the fourth quarter of 2017 in conjunction with our annual impairment testing. The adoption had no impact on our Consolidated Financial Statements. Recently Issued Accounting Pronouncements Not Yet Adopted In May 2014, the FASB issued ASU No. 2014-09, Revenue from Contracts with Customers , which outlines a single comprehensive model for entities to use in accounting for revenue arising from contracts with customers that supersedes most current revenue recognition guidance. This guidance requires an entity to recognize revenue when it transfers promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. The guidance also requires additional financial statement disclosures that will enable users to understand the nature, amount, timing and uncertainty of revenue and cash flows relating to customer contracts. The new standard was originally effective for us on January 1, 2017; however, in July 2015 the FASB decided to defer the effective date by one year. Early application is not permitted, but reporting entities may choose to adopt the standard as of the original effective date. The standard permits the use of either the full retrospective or modified retrospective transition method. We have concluded our assessment of the new standard and will be adopting the provisions of this ASU in the first quarter of 2018 utilizing the modified retrospective transition method. The adoption of the new standard will not have a material impact on our Consolidated Financial Statements. In February 2016, the FASB issued ASU No. 2016-02, Leases (Topic 842). This ASU will require lessees to recognize a right-of-use asset and lease liability for all leases with terms of more than 12 months. Recognition, measurement and presentation of expenses will depend on classification as a finance or operating lease. This ASU also requires certain quantitative and qualitative disclosures. Accounting guidance for lessors is largely unchanged. The amendments should be applied on a modified retrospective basis. ASU 2016-02 is effective for us beginning January 1, 2019. We are in the process of developing an inventory of our lease arrangements in order to determine the impact that the adoption of ASU 2016-02 will have on our consolidated financial statements and related disclosures. Based on our assessment to date, we expect adoption of this standard to result in a material increase in lease-related assets and liabilities on our Consolidated Balance Sheets; however, we do not expect it to have a significant impact on our Consolidated Statements of Income or Cash Flows. In March 2017, the FASB issued ASU No. 2017-07, Compensation-Retirement Benefits (Topic 715) . This ASU will require an employer to report the service cost component of net benefit cost in the same line item as other compensation costs arising from services rendered by the pertinent employees during the period. The other components of net benefit cost are required to be presented in the income statement separately from the service cost component and outside a subtotal of income from operations, if presented, or disclosed separately. In addition, only the service cost component may be eligible for capitalization where applicable. The amendments should be applied on a retrospective basis. ASU 2017-07 is effective for us beginning January 1, 2018, with early adoption permitted as of the beginning of a financial year. We will adopt the provisions of this ASU in the first quarter of 2018. Adoption of the new standard will only impact classification within our Consolidated Statements of Income. In August 2017, the FASB issued ASU No. 2017-12, Derivatives and Hedging (Topic 815): Targeted Improvements to Accounting for Hedging Activities , which amends ASC 815. The purpose of this ASU is to better align accounting rules with a company’s risk management activities and financial reporting for hedging relationships, better reflect economic results of hedging in financial statements, simplify hedge accounting requirements and improve the disclosures of hedging arrangements. The amendment should be applied using the modified retrospective transition method. ASU 2017-12 is effective for annual periods beginning after December 15, 2018 and interim periods within those annual periods, with early adoption permitted. We intend to adopt the provisions of this ASU in the first quarter of 2018. We believe the adoption of the new standard will not have a material impact on our Consolidated Financial Statements. No other new accounting pronouncement issued or effective during the fiscal year had or is expected to have a material impact on our consolidated financial statements or disclosures. |
BUSINESS ACQUISITIONS AND DIV29
BUSINESS ACQUISITIONS AND DIVESTITURES (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Ripple Brand Collective, LLC [Member] | |
Business Acquisition and Divestitures [Line Items] | |
Schedule of Purchase Consideration Allocation to Assets Acquired and Liabilities Assumed | The purchase consideration was allocated to assets acquired and liabilities assumed based on their respective fair values as follows: Goodwill $ 128,110 Trademarks 91,200 Other intangible assets 60,900 Other assets, primarily current assets, net of cash acquired totaling $674 12,375 Current liabilities (7,211 ) Net assets acquired $ 285,374 |
KRAVE Pure Foods, Inc. | |
Business Acquisition and Divestitures [Line Items] | |
Schedule of Purchase Consideration Allocation to Assets Acquired and Liabilities Assumed | The purchase consideration was allocated to assets acquired and liabilities assumed based on their respective fair values as follows: Goodwill $ 147,089 Trademarks 112,000 Other intangible assets 17,000 Other assets, primarily current assets, net of cash acquired totaling $1,362 9,465 Current liabilities (2,756 ) Non-current deferred tax liabilities (47,344 ) Net assets acquired $ 235,454 |
GOODWILL AND INTANGIBLE ASSETS
GOODWILL AND INTANGIBLE ASSETS (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of the Changes in the Carrying Value of Goodwill by Reportable Segment | The changes in the carrying value of goodwill by reportable segment for the years ended December 31, 2017 and 2016 are as follows: North America International and Other Total Goodwill $ 667,056 $ 379,544 $ 1,046,600 Accumulated impairment loss (4,973 ) (357,375 ) (362,348 ) Balance at January 1, 2016 662,083 22,169 684,252 Acquired during the period (see Note 2) 128,110 — 128,110 Foreign currency translation 1,997 (2,015 ) (18 ) Balance at December 31, 2016 792,190 20,154 812,344 Foreign currency translation 7,739 978 8,717 Balance at December 31, 2017 $ 799,929 $ 21,132 $ 821,061 |
Schedule of Gross Carrying Amount and Accumulated Amortization for Each Major Class of Intangible Asset | The following table provides the gross carrying amount and accumulated amortization for each major class of intangible asset: December 31, 2017 2016 Gross Carrying Amount Accumulated Amortization Gross Carrying Amount Accumulated Amortization Intangible assets subject to amortization: Trademarks $ 277,473 $ (37,510 ) $ 317,023 $ (30,458 ) Customer-related 128,182 (34,659 ) 200,409 (36,482 ) Patents 17,009 (15,975 ) 16,426 (13,700 ) Total 422,664 (88,144 ) 533,858 (80,640 ) Intangible assets not subject to amortization: Trademarks 34,636 39,519 Total other intangible assets $ 369,156 $ 492,737 |
Schedule of Amortization Expense, for the Next Five Years | Amortization expense for the next five years, based on current intangible balances, is estimated to be as follows: Year ending December 31, 2018 2019 2020 2021 2022 Amortization expense $ 20,529 $ 19,599 $ 19,360 $ 19,345 $ 19,345 |
SHORT AND LONG-TERM DEBT (Table
SHORT AND LONG-TERM DEBT (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Debt Disclosure [Abstract] | |
Schedule of Long-term Debt Instruments | Long-term debt consisted of the following: December 31, 2017 2016 1.60% Notes due 2018 $ 300,000 $ 300,000 4.125% Notes due 2020 350,000 350,000 8.8% Debentures due 2021 84,715 84,715 2.625% Notes due 2023 250,000 250,000 3.20% Notes due 2025 300,000 300,000 2.30% Notes due 2026 500,000 500,000 7.2% Debentures due 2027 193,639 193,639 3.375% Notes due 2046 300,000 300,000 Capital lease obligations 99,194 83,619 Net impact of interest rate swaps, debt issuance costs and unamortized debt discounts (16,427 ) (14,275 ) Total long-term debt 2,361,121 2,347,698 Less—current portion 300,098 243 Long-term portion $ 2,061,023 $ 2,347,455 |
Schedule of Maturities of Long-term Debt | Aggregate annual maturities of our long-term Notes (excluding capital lease obligations and net impact of interest rate swaps, debt issuance costs and unamortized debt discounts) are as follows for the years ending December 31: 2018 $ 300,098 2019 — 2020 350,000 2021 84,715 2022 — Thereafter 1,543,639 |
Schedule of Net Interest Expense | Net interest expense consists of the following: For the years ended December 31, 2017 2016 2015 Interest expense $ 104,232 $ 97,851 $ 93,520 Capitalized interest (4,166 ) (5,903 ) (12,537 ) Loss on extinguishment of debt — — 28,326 Interest expense 100,066 91,948 109,309 Interest income (1,784 ) (1,805 ) (3,536 ) Interest expense, net $ 98,282 $ 90,143 $ 105,773 |
DERIVATIVE INSTRUMENTS (Tables)
DERIVATIVE INSTRUMENTS (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Schedule of the Classification of Derivative Assets and Liabilities within the Consolidated Balance Sheets | The following table presents the classification of derivative assets and liabilities within the Consolidated Balance Sheets as of December 31, 2017 and 2016 : December 31, 2017 2016 Assets (1) Liabilities (1) Assets (1) Liabilities (1) Derivatives designated as cash flow hedging instruments: Foreign exchange contracts $ 423 $ 1,427 $ 2,229 $ 809 Derivatives designated as fair value hedging instruments: Interest rate swap agreements — 1,897 1,768 — Derivatives not designated as hedging instruments: Commodities futures and options (2) 390 3,054 2,348 10,000 Deferred compensation derivatives 1,581 — 717 — Foreign exchange contracts 31 — — 16 2,002 3,054 3,065 10,016 Total $ 2,425 $ 6,378 $ 7,062 $ 10,825 (1) Derivatives assets are classified on our balance sheet within prepaid expenses and other as well as other assets. Derivative liabilities are classified on our balance sheet within accrued liabilities and other long-term liabilities. (2) As of December 31, 2017 , amounts reflected on a net basis in liabilities were assets of $48,505 and liabilities of $50,179 , which are associated with cash transfers receivable or payable on commodities futures contracts reflecting the change in quoted market prices on the last trading day for the period. The comparable amounts reflected on a net basis in liabilities at December 31, 2016 were assets of $140,885 and liabilities of $150,872 . At December 31, 2017 and 2016 , the remaining amount reflected in assets and liabilities related to the fair value of other non-exchange traded derivative instruments, respectively. |
Schedule of the Effect of Derivative Instruments on the Consolidated Statements of Income | The effect of derivative instruments on the Consolidated Statements of Income for the years ended December 31, 2017 and December 31, 2016 was as follows: Non-designated Hedges Cash Flow Hedges Gains (losses) recognized in income (a) Gains (losses) recognized in other comprehensive income (“OCI”) (effective portion) Gains (losses) reclassified from accumulated OCI into income (effective portion) (b) 2017 2016 2017 2016 2017 2016 Commodities futures and options $ (55,734 ) $ (171,753 ) $ — $ — $ (1,774 ) $ 30,783 Foreign exchange contracts (23 ) (46 ) (4,931 ) (5,485 ) (3,180 ) (5,625 ) Interest rate swap agreements — — — (47,223 ) (9,480 ) (8,676 ) Deferred compensation derivatives 4,497 2,203 — — — — Total $ (51,260 ) $ (169,596 ) $ (4,931 ) $ (52,708 ) $ (14,434 ) $ 16,482 (a) Gains (losses) recognized in income for non-designated commodities futures and options contracts were included in cost of sales. Gains (losses) recognized in income for non-designated foreign currency forward exchange contracts and deferred compensation derivatives were included in selling, marketing and administrative expenses. (b) Gains (losses) reclassified from AOCI into income were included in cost of sales for commodities futures and options contracts and for foreign currency forward exchange contracts designated as hedges of purchases of inventory or other productive assets. Other gains (losses) for foreign currency forward exchange contracts were included in selling, marketing and administrative expenses. Losses reclassified from AOCI into income for interest rate swap agreements were included in interest expense. |
FAIR VALUE MEASUREMENTS FAIR 33
FAIR VALUE MEASUREMENTS FAIR VALUE MEASUREMENTS (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
FAIR VALUE MEASUREMENTS [Abstract] | |
Schedule of Assets and Liabilities Measured at Fair Value | The following table presents assets and liabilities that were measured at fair value in the Consolidated Balance Sheet on a recurring basis as of December 31, 2017 and 2016 : Assets (Liabilities) Level 1 Level 2 Level 3 Total December 31, 2017: Derivative Instruments: Assets: Foreign exchange contracts (1) $ — $ 454 $ — $ 454 Deferred compensation derivatives (3) — 1,581 — 1,581 Commodities futures and options (4) 390 — — 390 Liabilities: Foreign exchange contracts (1) — 1,427 — 1,427 Interest rate swap agreements (2) — 1,897 — 1,897 Commodities futures and options (4) 3,054 — — 3,054 December 31, 2016: Assets: Foreign exchange contracts (1) $ — $ 2,229 $ — $ 2,229 Interest rate swap agreements (2) — 1,768 — 1,768 Deferred compensation derivatives (3) — 717 — 717 Commodities futures and options (4) 2,348 — — 2,348 Liabilities: Foreign exchange contracts (1) — 825 — 825 Commodities futures and options (4) 10,000 — — 10,000 (1) The fair value of foreign currency forward exchange contracts is the difference between the contract and current market foreign currency exchange rates at the end of the period. We estimate the fair value of foreign currency forward exchange contracts on a quarterly basis by obtaining market quotes of spot and forward rates for contracts with similar terms, adjusted where necessary for maturity differences. (2) The fair value of interest rate swap agreements represents the difference in the present value of cash flows calculated at the contracted interest rates and at current market interest rates at the end of the period. We calculate the fair value of interest rate swap agreements quarterly based on the quoted market price for the same or similar financial instruments. (3) The fair value of deferred compensation derivatives is based on quoted prices for market interest rates and a broad market equity index. (4) The fair value of commodities futures and options contracts is based on quoted market prices. |
Schedule of Fair Values and Carrying Values of Long-Term Debt | The fair values and carrying values of long-term debt, including the current portion, were as follows: Fair Value Carrying Value At December 31, 2017 2016 2017 2016 Current portion of long-term debt $ 299,430 $ 243 $ 300,098 $ 243 Long-term debt 2,113,296 2,379,054 2,061,023 2,347,455 Total $ 2,412,726 $ 2,379,297 $ 2,361,121 $ 2,347,698 |
BUSINESS REALIGNMENT ACTIVITI34
BUSINESS REALIGNMENT ACTIVITIES (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Restructuring and Related Activities [Abstract] | |
Schedule of Business Realignment Activity | Costs recorded in 2017 , 2016 and 2015 related to these activities are as follows: For the years ended December 31, 2017 2016 2015 Margin for Growth Program: Severance $ 32,554 $ — $ — Accelerated depreciation 6,873 — — Other program costs 16,407 — — Operational Optimization Program: Severance 13,828 17,872 — Accelerated depreciation — 48,590 — Other program costs (303 ) 21,831 — 2015 Productivity Initiative: Severance — — 81,290 Pension settlement charges — 13,669 10,178 Other program costs — 5,609 14,285 Other international restructuring programs: Severance — — 6,651 Accelerated depreciation and amortization — — 5,904 Mauna Loa Divestiture (see Note 2) — — 2,667 Total $ 69,359 $ 107,571 $ 120,975 Costs associated with business realignment activities are classified in our Consolidated Statements of Income as follows: For the years ended December 31, 2017 2016 2015 Cost of sales $ 5,147 $ 58,106 $ 8,801 Selling, marketing and administrative expense 16,449 16,939 17,368 Business realignment costs 47,763 32,526 94,806 Costs associated with business realignment activities $ 69,359 $ 107,571 $ 120,975 |
Schedule of Liability Activity for Costs Qualifying as Exit and Disposal Costs | The following table presents the liability activity for costs qualifying as exit and disposal costs for the year ended December 31, 2017 : Total Liability balance at December 31, 2016 $ 3,725 2017 business realignment charges (1) 61,872 Cash payments (26,536 ) Other, net (69 ) Liability balance at December 31, 2017 (reported within accrued and other long-term liabilities) $ 38,992 (1) The costs reflected in the liability roll-forward represent employee-related and certain third-party service provider charges. These costs do not include items charged directly to expense, such as accelerated depreciation and amortization and certain of the third-party charges associated with various programs, as those items are not reflected in the business realignment liability in our Consolidated Balance Sheets. |
INCOME TAXES (Tables)
INCOME TAXES (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Income Tax Disclosure [Abstract] | |
Schedule of Income (Loss) Before Income Taxes | The components of income (loss) before income taxes are as follows: For the years ended December 31, 2017 2016 2015 Domestic $ 1,187,825 $ 1,395,440 $ 1,357,618 Foreign (77,157 ) (295,959 ) (455,771 ) Income before income taxes $ 1,110,668 $ 1,099,481 $ 901,847 |
Schedule of Components of Income Tax Expense (Benefit) | The components of our provision for income taxes are as follows: For the years ended December 31, 2017 2016 2015 Current: Federal $ 314,277 $ 391,705 $ 409,060 State 37,628 51,706 47,978 Foreign (16,356 ) (25,877 ) (29,605 ) 335,549 417,534 427,433 Deferred: Federal 19,204 (7,706 ) (31,153 ) State 7,573 (452 ) (2,346 ) Foreign (8,195 ) (29,939 ) (5,038 ) 18,582 (38,097 ) (38,537 ) Total provision for income taxes $ 354,131 $ 379,437 $ 388,896 |
Schedule of Deferred Tax Asset and Liabilities | The significant temporary differences that comprised the deferred tax assets and liabilities are as follows: December 31, 2017 2016 Deferred tax assets: Post-retirement benefit obligations $ 58,306 $ 90,584 Accrued expenses and other reserves 103,769 141,228 Stock-based compensation 31,364 48,500 Derivative instruments 27,109 44,010 Pension — 14,662 Lease financing obligation 12,310 18,950 Accrued trade promotion reserves 26,028 50,463 Net operating loss carryforwards 226,142 143,085 Capital loss carryforwards 23,215 38,691 Other 7,748 14,452 Gross deferred tax assets 515,991 604,625 Valuation allowance (312,148 ) (235,485 ) Total deferred tax assets 203,843 369,140 Deferred tax liabilities: Property, plant and equipment, net 132,443 202,300 Acquired intangibles 68,476 113,074 Inventories 20,769 27,608 Pension 969 — Other 23,819 8,884 Total deferred tax liabilities 246,476 351,866 Net deferred tax (liabilities) assets $ (42,633 ) $ 17,274 Included in: Non-current deferred tax assets, net 3,023 56,861 Non-current deferred tax liabilities, net (45,656 ) (39,587 ) Net deferred tax (liabilities) assets $ (42,633 ) $ 17,274 |
Schedule of Effective Income Tax Rate Reconciliation | The following table reconciles the federal statutory income tax rate with our effective income tax rate: For the years ended December 31, 2017 2016 2015 Federal statutory income tax rate 35.0 % 35.0 % 35.0 % Increase (reduction) resulting from: State income taxes, net of Federal income tax benefits 2.6 3.4 4.2 Qualified production income deduction (2.9 ) (3.8 ) (4.4 ) Business realignment and impairment charges and gain on sale of trademark licensing rights 4.3 0.4 10.8 Foreign rate differences (4.3 ) 3.6 2.2 Historic and solar tax credits (4.8 ) (3.3 ) (3.3 ) U.S. tax reform 2.9 — — Other, net (0.9 ) (0.8 ) (1.4 ) Effective income tax rate 31.9 % 34.5 % 43.1 % |
Schedule of Unrecognized Tax Benefits Roll Forward | A reconciliation of the beginning and ending amount of unrecognized tax benefits is as follows: December 31, 2017 2016 Balance at beginning of year $ 36,002 $ 33,411 Additions for tax positions taken during prior years 2,492 2,804 Reductions for tax positions taken during prior years (1,689 ) (4,080 ) Additions for tax positions taken during the current year 10,018 9,100 Settlements (1,481 ) — Expiration of statutes of limitations (3,260 ) (5,233 ) Balance at end of year $ 42,082 $ 36,002 |
PENSION AND OTHER POST-RETIRE36
PENSION AND OTHER POST-RETIREMENT BENEFIT PLANS (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Retirement Benefits [Abstract] | |
Schedule of Defined Benefit Obligations, Plan Assets, and Funded Status | A summary of the changes in benefit obligations, plan assets and funded status of these plans is as follows: Pension Benefits Other Benefits December 31, 2017 2016 2017 2016 Change in benefit obligation Projected benefit obligation at beginning of year $ 1,118,318 $ 1,169,424 $ 242,846 $ 255,617 Service cost 20,657 23,075 263 299 Interest cost 40,996 41,875 8,837 9,731 Plan amendments (8,473 ) (43,065 ) — — Actuarial (gain) loss 40,768 15,804 2,207 (2,998 ) Settlement (44,978 ) (59,784 ) — — Currency translation and other 6,749 1,416 889 314 Benefits paid (56,473 ) (30,427 ) (18,930 ) (20,117 ) Projected benefit obligation at end of year 1,117,564 1,118,318 236,112 242,846 Change in plan assets Fair value of plan assets at beginning of year 1,023,676 1,041,902 — — Actual return on plan assets 121,241 49,012 — — Employer contributions 37,503 21,580 18,930 20,117 Settlement (44,978 ) (59,784 ) — — Currency translation and other 5,257 1,393 — — Benefits paid (56,473 ) (30,427 ) (18,930 ) (20,117 ) Fair value of plan assets at end of year 1,086,226 1,023,676 — — Funded status at end of year $ (31,338 ) $ (94,642 ) $ (236,112 ) $ (242,846 ) Amounts recognized in the Consolidated Balance Sheets: Other assets $ 14,988 $ 39 $ — $ — Accrued liabilities (6,916 ) (28,994 ) (20,792 ) (22,576 ) Other long-term liabilities (39,410 ) (65,687 ) (215,320 ) (220,270 ) Total $ (31,338 ) $ (94,642 ) $ (236,112 ) $ (242,846 ) Amounts recognized in Accumulated Other Comprehensive Income (Loss), net of tax: Actuarial net (loss) gain $ (207,659 ) $ (243,228 ) $ 8,313 $ 9,264 Net prior service credit (cost) 30,994 28,360 (1,174 ) (1,565 ) Net amounts recognized in AOCI $ (176,665 ) $ (214,868 ) $ 7,139 $ 7,699 |
Schedule of Accumulated Benefit Obligations in Excess of Plan Assets | Plans with accumulated benefit obligations in excess of plan assets were as follows: December 31, 2017 2016 Projected benefit obligation $ 711,767 $ 1,118,294 Accumulated benefit obligation 675,660 1,081,254 Fair value of plan assets 665,441 1,023,613 |
Schedule of Components of Net Periodic Benefit Cost | The components of net periodic benefit cost were as follows: Pension Benefits Other Benefits For the years ended December 31, 2017 2016 2015 2017 2016 2015 Amounts recognized in net periodic benefit cost Service cost $ 20,657 $ 23,075 $ 28,300 $ 263 $ 299 $ 542 Interest cost 40,996 41,875 44,179 8,837 9,731 10,187 Expected return on plan assets (57,370 ) (58,820 ) (68,830 ) — — — Amortization of prior service (credit) cost (5,822 ) (1,555 ) (1,178 ) 748 575 611 Amortization of net loss (gain) 33,648 34,940 30,510 (1 ) (13 ) (57 ) Curtailment credit — — (688 ) — — 204 Settlement loss 17,732 22,657 23,067 — — — Total net periodic benefit cost $ 49,841 $ 62,172 $ 55,360 $ 9,847 $ 10,592 $ 11,487 Change in plan assets and benefit obligations recognized in AOCI, pre-tax Actuarial net (gain) loss $ (73,768 ) $ (31,772 ) $ (21,554 ) $ 2,139 $ (3,047 ) $ (26,270 ) Prior service (credit) cost (2,650 ) (41,517 ) 1,748 (744 ) (572 ) (834 ) Total recognized in other comprehensive (income) loss, pre-tax $ (76,418 ) $ (73,289 ) $ (19,806 ) $ 1,395 $ (3,619 ) $ (27,104 ) Net amounts recognized in periodic benefit cost and AOCI $ (26,577 ) $ (11,117 ) $ 35,554 $ 11,242 $ 6,973 $ (15,617 ) |
Schedule of Amounts in Accumulated Other Comprehensive Income (Loss) to be Recognized over Next Fiscal Year | Amounts expected to be amortized from AOCI into net periodic benefit cost during 2018 are as follows: Pension Plans Post-Retirement Benefit Plans Amortization of net actuarial loss $ 26,735 $ — Amortization of prior service (credit) cost $ (7,197 ) $ 836 |
Schedule of Weighted-Average Assumptions Used in Computing the Benefit Obligation | The weighted-average assumptions used in computing the benefit obligations were as follows: Pension Benefits Other Benefits December 31, 2017 2016 2017 2016 Discount rate 3.4 % 3.8 % 3.5 % 3.8 % Rate of increase in compensation levels 3.8 % 3.8 % N/A N/A The weighted-average assumptions used in computing net periodic benefit cost were as follows: Pension Benefits Other Benefits For the years ended December 31, 2017 2016 2015 2017 2016 2015 Discount rate 3.8 % 4.0 % 3.7 % 3.8 % 4.0 % 3.7 % Expected long-term return on plan assets 5.8 % 6.1 % 6.3 % N/A N/A N/A Rate of compensation increase 3.8 % 3.8 % 4.1 % N/A N/A N/A |
Schedule of Effect of One-Percentage-Point Change in Assumed Health Care Cost Trend Rates | A one-percentage point change in assumed health care cost trend rates would have the following effects: Impact of assumed health care cost trend rates One-Percentage One-Percentage Effect on total service and interest cost components $ 148 $ (129 ) Effect on accumulated post-retirement benefit obligation 3,133 (2,758 ) |
Schedule of Allocation of Plan Assets | Our target asset allocation for our major domestic pension plans as of December 31, 2017 was as follows: Asset Class Target Asset Allocation Cash 1% Equity securities 25% Fixed income securities 49% Alternative investments, including real estate, listed infrastructure and other 25% The following table sets forth by level, within the fair value hierarchy (as defined in Note 6), pension plan assets at their fair values as of December 31, 2017 : Quoted prices in active markets of identical assets Significant other observable inputs Significant other unobservable inputs (Level 3) Investments Using NAV as a Practical Expedient (1) Total Cash and cash equivalents $ 1,179 $ 18,161 $ — $ 730 $ 20,070 Equity securities: Global all-cap (a) — — — 276,825 276,825 Fixed income securities: U.S. government/agency — — — 239,686 239,686 Corporate bonds (b) — 33,019 — 162,633 195,652 Collateralized obligations (c) — 40,350 — 34,538 74,888 International government/corporate bonds (d) — — — 32,447 32,447 Alternative investments: Global diversified assets (e) — — — 149,030 149,030 Global real estate investment trusts (f) — — — 50,213 50,213 Global infrastructure (g) — — — 47,415 47,415 Total pension plan assets $ 1,179 $ 91,530 $ — $ 993,517 $ 1,086,226 The following table sets forth by level, within the fair value hierarchy, pension plan assets at their fair values as of December 31, 2016 : Quoted prices in active markets of identical assets (Level 1) Significant other observable inputs (Level 2) Significant other unobservable inputs (Level 3) Total Cash and cash equivalents $ 576 $ 9,540 $ — $ 10,116 Equity securities: Global all-cap (a) 20,216 242,214 — 262,430 Fixed income securities: U.S. government/agency — 228,648 — 228,648 Corporate bonds (b) — 199,634 — 199,634 Collateralized obligations (c) — 50,532 — 50,532 International government/corporate bonds (d) — 30,928 — 30,928 Alternative investments: Global diversified assets (e) — 146,975 — 146,975 Global real estate investment trusts (f) — 48,000 — 48,000 Global infrastructure (g) — 46,413 — 46,413 Total pension plan assets $ 20,792 $ 1,002,884 $ — $ 1,023,676 (1) Certain investments that are measured at fair value using the net asset value per share (or its equivalent) practical expedient have not been categorized in the fair value hierarchy but are included to reconcile to the amounts presented in our Obligations and Funded Status table. (a) This category comprises equity funds that primarily track the MSCI World Index or MSCI All Country World Index. (b) This category comprises fixed income funds primarily invested in investment grade and high yield bonds. (c) This category comprises fixed income funds primarily invested in high quality mortgage-backed securities and other asset-backed obligations. (d) This category comprises fixed income funds primarily invested in Canadian and other international bonds. (e) This category comprises diversified funds invested across alternative asset classes. (f) This category comprises equity funds primarily invested in publicly traded real estate securities. (g) This category comprises equity funds primarily invested in publicly traded listed infrastructure securities. |
Schedule of Expected Benefit Payments | Total benefit payments expected to be paid to plan participants, including pension benefits funded from the plans and other benefits funded from Company assets, are as follows: Expected Benefit Payments 2018 2019 2020 2021 2022 2023-2027 Pension Benefits $ 126,392 $ 78,614 $ 85,804 $ 87,159 $ 107,005 $ 407,769 Other Benefits 20,773 19,026 17,768 16,863 15,767 69,003 |
STOCK COMPENSATION PLANS (Table
STOCK COMPENSATION PLANS (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Schedule of Stock Compensation Costs | For the periods presented, compensation expense for all types of stock-based compensation programs and the related income tax benefit recognized were as follows: For the years ended December 31, 2017 2016 2015 Pre-tax compensation expense $ 51,061 $ 54,785 $ 51,533 Related income tax benefit 13,684 17,148 17,109 |
Schedule of Activity Relating to the Grants of Stock Options | A summary of activity relating to grants of stock options for the year ended December 31, 2017 is as follows: Stock Options Shares Weighted-Average Weighted-Average Remaining Aggregate Intrinsic Value Outstanding at beginning of the period 6,192,008 $82.67 6.2 years Granted 1,094,155 $108.06 Exercised (1,133,511 ) $69.64 Forfeited (231,590 ) $103.03 Outstanding as of December 31, 2017 5,921,062 $89.06 5.8 years $ 141,893 Options exercisable as of December 31, 2017 3,699,469 $81.65 4.3 years $ 116,067 |
Schedule of Fair Value Estimated on the Grant Date and the Weighted Average Assumptions | The fair value was estimated on the date of grant using a Black-Scholes option-pricing model and the following weighted-average assumptions: For the years ended December 31, 2017 2016 2015 Dividend yields 2.4 % 2.4 % 2.1 % Expected volatility 17.2 % 16.8 % 20.7 % Risk-free interest rates 2.2 % 1.5 % 1.9 % Expected term in years 6.8 6.8 6.7 l “Dividend yields” means the sum of dividends declared for the four most recent quarterly periods, divided by the average price of our Common Stock for the comparable periods; l “Expected volatility” means the historical volatility of our Common Stock over the expected term of each grant; l “Risk-free interest rates” means the U.S. Treasury yield curve rate in effect at the time of grant for periods within the contractual life of the stock option; and l “Expected term” means the period of time that stock options granted are expected to be outstanding based primarily on historical data. |
Schedule of Outstanding Stock Options | The following table summarizes information about stock options outstanding as of December 31, 2017 : Options Outstanding Options Exercisable Range of Exercise Prices Number Weighted- Weighted- Number Weighted- $33.40 - $81.73 1,985,084 3.4 $63.53 1,985,084 $63.53 $81.74 - $105.91 2,060,833 6.9 $97.25 929,199 $99.72 $105.92 - $111.76 1,875,145 7.1 $107.06 785,186 $106.04 $33.40 - $111.76 5,921,062 5.8 $89.06 3,699,469 $81.65 |
Schedule of Activity Relating to Grants of PSUs and RSUs | A summary of activity relating to grants of PSUs and RSUs for the period ended December 31, 2017 is as follows: Performance Stock Units and Restricted Stock Units Number of units Weighted-average grant date fair value for equity awards (per unit) Outstanding at beginning of year 828,228 $102.66 Granted 478,044 $110.97 Performance assumption change 21,305 $96.71 Vested (277,261 ) $109.35 Forfeited (126,952 ) $107.91 Outstanding at end of year 923,364 $103.11 |
Schedule of Information Pertaining to Fair Value of PSUs and RSUs Granted for Potential Future Distribution | The following table sets forth information about the fair value of the PSUs and RSUs granted for potential future distribution to employees and non-employee directors. In addition, the table provides assumptions used to determine the fair value of the market-based total shareholder return component using the Monte Carlo simulation model on the date of grant. For the years ended December 31, 2017 2016 2015 Units granted 478,044 545,750 381,407 Weighted-average fair value at date of grant $ 110.97 $ 93.55 $ 104.68 Monte Carlo simulation assumptions: Estimated values $ 46.85 $ 38.02 $ 61.22 Dividend yields 2.3 % 2.5 % 2.0 % Expected volatility 20.4 % 17.0 % 14.9 % l “Estimated values” means the fair value for the market-based total shareholder return component of each PSU at the date of grant using a Monte Carlo simulation model; l “Dividend yields” means the sum of dividends declared for the four most recent quarterly periods, divided by the average price of our Common Stock for the comparable periods; l “Expected volatility” means the historical volatility of our Common Stock over the expected term of each grant. |
SEGMENT INFORMATION (Tables)
SEGMENT INFORMATION (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Segment Reporting [Abstract] | |
Schedule of Net Sales and Earnings by Segment | Our segment net sales and earnings were as follows: For the years ended December 31, 2017 2016 2015 Net sales: North America $ 6,621,173 $ 6,532,988 $ 6,468,158 International and Other 894,253 907,193 918,468 Total $ 7,515,426 $ 7,440,181 $ 7,386,626 Segment income (loss): North America $ 2,045,550 $ 2,040,995 $ 2,073,967 International and Other 11,532 (29,139 ) (98,067 ) Total segment income 2,057,082 2,011,856 1,975,900 Unallocated corporate expense (1) 504,323 497,423 497,386 Unallocated mark-to-market (gains) losses on commodity derivatives (35,292 ) 163,238 — Goodwill, indefinite and long-lived asset impairment charges 208,712 4,204 280,802 Costs associated with business realignment activities 69,359 107,571 120,975 Non-service related pension expense 35,028 27,157 18,079 Acquisition and integration costs 311 6,480 20,899 Operating profit 1,274,641 1,205,783 1,037,759 Interest expense, net 98,282 90,143 105,773 Other (income) expense, net 65,691 16,159 30,139 Income before income taxes $ 1,110,668 $ 1,099,481 $ 901,847 (1) Includes centrally-managed (a) corporate functional costs relating to legal, treasury, finance, and human resources, (b) expenses associated with the oversight and administration of our global operations, including warehousing, distribution and manufacturing, information systems and global shared services, (c) non-cash stock-based compensation expense, and (d) other gains or losses that are not integral to segment performance. |
Schedule of Unallocated Mark-to-Market (Gains) Losses on Commodity Derivatives | Activity within the unallocated mark-to-market (gains) losses on commodity derivatives is as follows: For the years ended December 31, 2017 2016 Net losses on mark-to-market valuation of commodity derivative positions recognized in income $ 55,734 $ 171,753 Net losses on commodity derivative positions reclassified from unallocated to segment income (91,026 ) (8,515 ) Net (gains) losses on mark-to-market valuation of commodity derivative positions recognized in unallocated derivative (gains) losses $ (35,292 ) $ 163,238 |
Schedule of Depreciation and Amortization Expense Included within Segment Income | Depreciation and amortization expense included within segment income presented above is as follows: For the years ended December 31, 2017 2016 2015 North America $ 171,265 $ 162,211 $ 153,185 International and Other 42,542 50,753 46,342 Corporate (1) 48,046 88,873 45,401 Total $ 261,853 $ 301,837 $ 244,928 (1) Corporate includes non-cash asset-related accelerated depreciation and amortization related to business realignment activities, as discussed in Note 7. Such amounts are not included within our measure of segment income. |
Schedule of Segment Information by Geography | Additional geographic information is as follows: 2017 2016 2015 Net sales: United States $ 6,263,703 $ 6,196,723 $ 6,116,490 Other 1,251,723 1,243,458 1,270,136 Total $ 7,515,426 $ 7,440,181 $ 7,386,626 Long-lived assets: United States $ 1,575,496 $ 1,528,255 $ 1,528,723 Other 531,201 648,993 711,737 Total $ 2,106,697 $ 2,177,248 $ 2,240,460 |
EQUITY AND NONCONTROLLING INT39
EQUITY AND NONCONTROLLING INTEREST (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Equity [Abstract] | |
Schedule of the Changes in the Outstanding Shares of Common Stock | Changes in the outstanding shares of Common Stock for the past three years were as follows: For the years ended December 31, 2017 2016 2015 Shares issued 359,901,744 359,901,744 359,901,744 Treasury shares at beginning of year (147,642,009 ) (143,124,384 ) (138,856,786 ) Stock repurchases: Shares repurchased in the open market under pre-approved share repurchase programs — (4,640,964 ) (4,209,112 ) Milton Hershey School Trust repurchase (1,500,000 ) — — Shares repurchased to replace Treasury Stock issued for stock options and incentive compensation (1,278,675 ) (1,820,766 ) (1,776,838 ) Stock issuances: Shares issued for stock options and incentive compensation 1,379,757 1,944,105 1,718,352 Treasury shares at end of year (149,040,927 ) (147,642,009 ) (143,124,384 ) Net shares outstanding at end of year 210,860,817 212,259,735 216,777,360 |
Schedule of Activity Relating to the Noncontrolling Interest | A roll-forward showing the 2017 activity relating to the noncontrolling interest follows: Noncontrolling Interest Balance, December 31, 2016 $ 41,831 Net loss attributable to noncontrolling interest (26,444 ) Other comprehensive income - foreign currency translation adjustments 840 Balance, December 31, 2017 $ 16,227 |
COMMITMENTS AND CONTINGENCIES (
COMMITMENTS AND CONTINGENCIES (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Commitments and Contingencies Disclosure [Abstract] | |
Purchase Obligations Covered by Purchase Agreements with Various Suppliers Future Maturity Schedule | As of December 31, 2017 , we had entered into agreements for the purchase of raw materials with various suppliers. Subject to meeting our quality standards, the purchase obligations covered by these agreements were as follows as of December 31, 2017 : in millions 2018 2019 2020 2021 2022 Purchase obligations $ 1,359.7 $ 272.3 $ 11.4 $ 2.5 $ 0.7 |
Schedule of Future Minimum Lease Payments for Capital Leases | Future minimum payments under lease arrangements with a remaining term in excess of one year were as follows as of December 31, 2017 : Operating leases (1) Capital leases (2) 2018 $ 16,241 $ 3,401 2019 16,784 3,469 2020 14,763 3,538 2021 12,914 3,609 2022 11,267 4,216 Thereafter 182,368 175,313 (1) Future minimum rental payments reflect commitments under non-cancelable operating leases primarily for offices, retail stores, warehouse and distribution facilities. Total rent expense for the years ended December 31, 2017 , 2016 and 2015 was $25,525 , $20,330 and $19,754 , respectively, including short-term rentals. (2) Future minimum rental payments reflect commitments under non-cancelable capital leases primarily for offices and warehouse facilities. |
Future Minimum Payments under Non-Cancelable Operating Leases | Future minimum payments under lease arrangements with a remaining term in excess of one year were as follows as of December 31, 2017 : Operating leases (1) Capital leases (2) 2018 $ 16,241 $ 3,401 2019 16,784 3,469 2020 14,763 3,538 2021 12,914 3,609 2022 11,267 4,216 Thereafter 182,368 175,313 (1) Future minimum rental payments reflect commitments under non-cancelable operating leases primarily for offices, retail stores, warehouse and distribution facilities. Total rent expense for the years ended December 31, 2017 , 2016 and 2015 was $25,525 , $20,330 and $19,754 , respectively, including short-term rentals. (2) Future minimum rental payments reflect commitments under non-cancelable capital leases primarily for offices and warehouse facilities. |
EARNINGS PER SHARE (Tables)
EARNINGS PER SHARE (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Earnings Per Share [Abstract] | |
Schedule of Basic and Diluted Earnings Per Share | We compute basic and diluted earnings per share based on the weighted-average number of shares of Common Stock and Class B common stock outstanding as follows: For the years ended December 31, 2017 2016 2015 Common Stock Class B Common Stock Common Stock Class B Common Stock Common Stock Class B Common Stock Basic earnings per share: Numerator: Allocation of distributed earnings (cash dividends paid) $ 385,878 $ 140,394 $ 367,081 $ 132,394 $ 352,953 $ 123,179 Allocation of undistributed earnings 188,286 68,423 162,299 58,270 27,324 9,495 Total earnings—basic $ 574,164 $ 208,817 $ 529,380 $ 190,664 $ 380,277 $ 132,674 Denominator (shares in thousands): Total weighted-average shares—basic 151,625 60,620 153,519 60,620 158,471 60,620 Earnings Per Share—basic $ 3.79 $ 3.44 $ 3.45 $ 3.15 $ 2.40 $ 2.19 Diluted earnings per share: Numerator: Allocation of total earnings used in basic computation $ 574,164 $ 208,817 $ 529,380 $ 190,664 $ 380,277 $ 132,674 Reallocation of total earnings as a result of conversion of Class B common stock to Common stock 208,817 — 190,664 — 132,674 — Reallocation of undistributed earnings — (492 ) — (324 ) — (69 ) Total earnings—diluted $ 782,981 $ 208,325 $ 720,044 $ 190,340 $ 512,951 $ 132,605 Denominator (shares in thousands): Number of shares used in basic computation 151,625 60,620 153,519 60,620 158,471 60,620 Weighted-average effect of dilutive securities: Conversion of Class B common stock to Common shares outstanding 60,620 — 60,620 — 60,620 — Employee stock options 1,144 — 964 — 1,335 — Performance and restricted stock units 353 — 201 — 225 — Total weighted-average shares—diluted 213,742 60,620 215,304 60,620 220,651 60,620 Earnings Per Share—diluted $ 3.66 $ 3.44 $ 3.34 $ 3.14 $ 2.32 $ 2.19 |
OTHER (INCOME) EXPENSE, NET O42
OTHER (INCOME) EXPENSE, NET OTHER (INCOME) EXPENSE, NET (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Other Income and Expenses [Abstract] | |
Schedule of Other (Income) Expense, Net | A summary of the components of other (income) expense, net is as follows: For the years ended December 31, 2017 2016 2015 Write-down of equity investments in partnerships qualifying for tax credits $ 66,209 $ 43,482 $ 39,489 Settlement of SGM liability (see Note 2) — (26,650 ) — Gain on sale of non-core trademark — — (9,950 ) Other (income) expense, net (518 ) (673 ) 600 Total $ 65,691 $ 16,159 $ 30,139 |
SUPPLEMENTAL BALANCE SHEET IN43
SUPPLEMENTAL BALANCE SHEET INFORMATION (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Schedule of Supplemental Balance Sheet Information | The components of certain Consolidated Balance Sheet accounts are as follows: December 31, 2017 2016 Inventories: Raw materials $ 224,940 $ 315,239 Goods in process 93,627 88,490 Finished goods 614,945 528,587 Inventories at FIFO 933,512 932,316 Adjustment to LIFO (180,676 ) (186,638 ) Total inventories $ 752,836 $ 745,678 Property, plant and equipment: Land $ 108,300 $ 103,865 Buildings 1,214,158 1,238,634 Machinery and equipment 2,925,353 3,001,552 Construction in progress 212,912 230,987 Property, plant and equipment, gross 4,460,723 4,575,038 Accumulated depreciation (2,354,026 ) (2,397,790 ) Property, plant and equipment, net $ 2,106,697 $ 2,177,248 Other assets: Capitalized software, net $ 104,881 $ 95,301 Income tax receivable — 1,449 Other non-current assets 146,998 71,615 Total other assets $ 251,879 $ 168,365 Accrued liabilities: Payroll, compensation and benefits $ 190,863 $ 240,080 Advertising and promotion 305,107 358,573 Other 180,164 152,333 Total accrued liabilities $ 676,134 $ 750,986 Other long-term liabilities: Post-retirement benefits liabilities $ 215,320 $ 220,270 Pension benefits liabilities 39,410 65,687 Other 184,209 114,204 Total other long-term liabilities $ 438,939 $ 400,161 Accumulated other comprehensive loss: Foreign currency translation adjustments $ (91,837 ) $ (110,613 ) Pension and post-retirement benefit plans, net of tax (169,526 ) (207,169 ) Cash flow hedges, net of tax (52,383 ) (58,106 ) Total accumulated other comprehensive loss $ (313,746 ) $ (375,888 ) |
QUARTERLY DATA (Tables)
QUARTERLY DATA (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Quarterly Financial Information Disclosure [Abstract] | |
Schedule of Quarterly Financial Information | Summary quarterly results were as follows: Year 2017 First Second Third Fourth Net sales $ 1,879,678 $ 1,662,991 $ 2,033,121 $ 1,939,636 Gross profit 906,560 763,210 940,222 834,527 Net income attributable to The Hershey Company 125,044 203,501 273,303 181,133 Common stock: Net income per share—Basic (a) 0.60 0.98 1.32 0.88 Net income per share—Diluted (a) 0.58 0.95 1.28 0.85 Dividends paid per share 0.618 0.618 0.656 0.656 Class B common stock: Net income per share—Basic (a) 0.55 0.89 1.20 0.80 Net income per share—Diluted (a) 0.55 0.89 1.20 0.80 Dividends paid per share 0.562 0.562 0.596 0.596 Market price—common stock: High 109.61 115.96 110.50 115.45 Low 103.45 106.41 104.06 102.87 Year 2016 First Second Third Fourth Net sales $ 1,828,812 $ 1,637,671 $ 2,003,454 $ 1,970,244 Gross profit 817,376 747,398 850,848 742,269 Net income attributable to The Hershey Company 229,832 145,956 227,403 116,853 Common stock: Net income per share—Basic (a) 1.09 0.70 1.09 0.56 Net income per share—Diluted (a) 1.06 0.68 1.06 0.55 Dividends paid per share 0.583 0.583 0.618 0.618 Class B common stock: Net income per share—Basic (a) 0.99 0.64 0.99 0.51 Net income per share—Diluted (a) 0.99 0.64 0.99 0.51 Dividends paid per share 0.530 0.530 0.562 0.562 Market price—common stock: High 93.71 113.49 113.89 104.44 Low 83.32 89.60 94.64 94.63 (a) Quarterly income per share amounts do not total to the annual amount due to changes in weighted-average shares outstanding during the year. |
SUMMARY OF SIGNIFICANT ACCOUN45
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - DESCRIPTION OF BUSINESS AND BASIS OF PRESENTATION (Details) | 12 Months Ended |
Dec. 31, 2017countrysegmentbrand_name | |
Accounting Policies [Abstract] | |
Number of brand names | brand_name | 80 |
Number of countries in which products are marketed, sold and distributed (country) | country | 80 |
Number of reportable segments (segment) | segment | 2 |
SUMMARY OF SIGNIFICANT ACCOUN46
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - REVENUE RECOGNITION (Details) | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Sales Revenue, Goods, Net | Customer Concentration Risk | McLane Company, Inc. | |||
Concentration Risk, Percentage | 29.00% | 25.00% | 26.00% |
SUMMARY OF SIGNIFICANT ACCOUN47
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - SELLING, MARKETING AND ADMINISTRATIVE EXPENSE (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Accounting Policies [Abstract] | |||
Research and development costs | $ 45,850 | $ 47,268 | $ 49,281 |
Advertising expense | 541,293 | 521,479 | $ 561,644 |
Prepaid advertising expense | $ 56 | $ 651 |
SUMMARY OF SIGNIFICANT ACCOUN48
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - ACCOUNTS RECEIVABLE - TRADE (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2016 | |
Revenue, Major Customer [Line Items] | ||
Allowance for doubtful accounts | $ 41,792 | $ 40,153 |
McLane Company, Inc. | Customer Concentration Risk | Accounts Receivable | ||
Revenue, Major Customer [Line Items] | ||
Concentration Risk, Percentage | 24.00% | |
Target Corporation [Member] | Customer Concentration Risk | Accounts Receivable | ||
Revenue, Major Customer [Line Items] | ||
Concentration Risk, Percentage | 11.00% |
SUMMARY OF SIGNIFICANT ACCOUN49
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - INVENTORIES (Details) - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 31, 2016 |
Accounting Policies [Abstract] | ||
Percentage of LIFO inventory | 59.00% | |
LIFO inventory amount | $ 443,492 | $ 402,919 |
SUMMARY OF SIGNIFICANT ACCOUN50
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - PROPERTY, PLANT AND EQUIPMENT (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Property, Plant and Equipment [Line Items] | |||
Assets under capital lease arrangements, net | $ 116,843 | $ 104,503 | |
Depreciation | $ 211,592 | $ 231,735 | $ 197,054 |
Machinery and Equipment | Minimum | |||
Property, Plant and Equipment [Line Items] | |||
Property, plant and equipment, useful life | 3 years | ||
Machinery and Equipment | Maximum | |||
Property, Plant and Equipment [Line Items] | |||
Property, plant and equipment, useful life | 15 years | ||
Building and Building Improvements | Minimum | |||
Property, Plant and Equipment [Line Items] | |||
Property, plant and equipment, useful life | 25 years | ||
Building and Building Improvements | Maximum | |||
Property, Plant and Equipment [Line Items] | |||
Property, plant and equipment, useful life | 40 years |
SUMMARY OF SIGNIFICANT ACCOUN51
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - COMPUTER SOFTWARE (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2016 | |
Property, Plant and Equipment [Line Items] | ||
Capitalized software, net | $ 104,881 | $ 95,301 |
Computer Software | ||
Property, Plant and Equipment [Line Items] | ||
Capitalized software, net | 104,881 | 95,301 |
Capitalized computer software, accumulated amortization | $ 296,042 | $ 322,807 |
Computer Software | Minimum | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment, useful life | 3 years | |
Computer Software | Maximum | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment, useful life | 7 years |
SUMMARY OF SIGNIFICANT ACCOUN52
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - GOODWILL AND OTHER INTANGIBLE ASSETS (Details) | 12 Months Ended |
Dec. 31, 2017 | |
Trademarks | |
Finite-Lived Intangible Assets [Line Items] | |
Finite-Lived Intangible Asset, Useful Life | 25 years |
Customer Relationships | |
Finite-Lived Intangible Assets [Line Items] | |
Finite-Lived Intangible Asset, Useful Life | 15 years |
Patents | |
Finite-Lived Intangible Assets [Line Items] | |
Finite-Lived Intangible Asset, Useful Life | 5 years |
SUMMARY OF SIGNIFICANT ACCOUN53
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - RECENT ACCOUNTING PRONOUNCEMENTS (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||
Net Cash Provided by (Used in) Operating Activities | $ 1,249,515 | $ 1,013,428 | $ 1,256,311 |
Net Cash Provided by (Used in) Financing Activities | 843,768 | 464,396 | 797,017 |
Accounting Standards Update 2016-09, Excess Tax Benefit Component [Member] | |||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||
Effective Income Tax Rate Reconciliation, Share-based Compensation, Excess Tax Benefit, Amount | 11,745 | ||
Net Cash Provided by (Used in) Operating Activities | 24,901 | 29,953 | 41,855 |
Net Cash Provided by (Used in) Financing Activities | $ 24,901 | $ 29,953 | $ 41,855 |
BUSINESS ACQUISITIONS AND DIV54
BUSINESS ACQUISITIONS AND DIVESTITURES - RIPPLE BRAND COLLECTIVE, LLC ASSETS ACQUIRED AND LIABILITIES ASSUMED ALLOCATION (Details) - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 31, 2016 | Apr. 26, 2016 | Dec. 31, 2015 |
Business Acquisition [Line Items] | ||||
Goodwill | $ 821,061 | $ 812,344 | $ 684,252 | |
Ripple Brand Collective, LLC [Member] | ||||
Business Acquisition [Line Items] | ||||
Goodwill | $ 128,110 | |||
Other current assets | 12,375 | |||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Cash and Equivalents | 674 | |||
Current liabilities | (7,211) | |||
Net assets acquired | 285,374 | |||
Trademarks | Ripple Brand Collective, LLC [Member] | ||||
Business Acquisition [Line Items] | ||||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Finite-Lived Intangibles | 91,200 | |||
Other | Ripple Brand Collective, LLC [Member] | ||||
Business Acquisition [Line Items] | ||||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Finite-Lived Intangibles | $ 60,900 |
BUSINESS ACQUISITIONS AND DIV55
BUSINESS ACQUISITIONS AND DIVESTITURES - RIPPLE BRAND COLLECTIVE, LLC NARRATIVE (Details) - Ripple Brand Collective, LLC [Member] | Apr. 26, 2016 |
Trademarks | |
Business Acquisition [Line Items] | |
Finite-Lived Intangible Asset, Useful Life | 27 years |
Other | Minimum | |
Business Acquisition [Line Items] | |
Finite-Lived Intangible Asset, Useful Life | 2 years |
Other | Maximum | |
Business Acquisition [Line Items] | |
Finite-Lived Intangible Asset, Useful Life | 14 years |
BUSINESS ACQUISITIONS AND DIV56
BUSINESS ACQUISITIONS AND DIVESTITURES - SHANGHAI GOLDEN MONKEY NARRATIVE (Details) - USD ($) $ in Thousands | Feb. 03, 2016 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | Sep. 26, 2014 |
Business Acquisition [Line Items] | ||||||
Payments of SGM liability (see Note 2) | $ 0 | $ 35,762 | $ 0 | |||
Gain on settlement of SGM liability (see Note 2) | 0 | 26,650 | 0 | |||
Shanghai Golden Monkey Food Joint Stock Co., Ltd. | ||||||
Business Acquisition [Line Items] | ||||||
Business Acquisition, Percentage of Voting Interests Acquired | 20.00% | 100.00% | 80.00% | |||
Payments of SGM liability (see Note 2) | $ 35,762 | |||||
Gain on settlement of SGM liability (see Note 2) | $ 26,650 | $ 0 | $ 26,650 | $ 0 |
BUSINESS ACQUISITIONS AND DIV57
BUSINESS ACQUISITIONS AND DIVESTITURES - KRAVE PURE FOODS NARRATIVE (Details) - USD ($) | 1 Months Ended | 10 Months Ended | 12 Months Ended | ||||||
Dec. 31, 2015 | Dec. 31, 2015 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | Mar. 31, 2016 | Oct. 04, 2015 | Jul. 05, 2015 | Mar. 31, 2015 | |
Business Acquisition [Line Items] | |||||||||
Payments of SGM liability (see Note 2) | $ 0 | $ 35,762,000 | $ 0 | ||||||
KRAVE Pure Foods, Inc. | |||||||||
Business Acquisition [Line Items] | |||||||||
Payments of SGM liability (see Note 2) | $ 220,016,000 | ||||||||
Maximum contingent consideration amount | $ 20,000,000 | ||||||||
Fair value of the contingent consideration | $ 10,000,000 | $ 10,000,000 | $ 16,800,000 | ||||||
Payment of contingent consideration | $ 10,000,000 |
BUSINESS ACQUISITIONS AND DIV58
BUSINESS ACQUISITIONS AND DIVESTITURES - KRAVE PURE FOODS ASSETS ACQUIRED AND LIABILITIES ASSUMED ALLOCATION (Details) - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | Mar. 31, 2015 |
Business Acquisition [Line Items] | ||||
Goodwill | $ 821,061 | $ 812,344 | $ 684,252 | |
KRAVE Pure Foods, Inc. | ||||
Business Acquisition [Line Items] | ||||
Goodwill | $ 147,089 | |||
Other current assets | 9,465 | |||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Cash and Equivalents | 1,362 | |||
Current liabilities | (2,756) | |||
Non-current deferred tax liabilities | (47,344) | |||
Net assets acquired | 235,454 | |||
KRAVE Pure Foods, Inc. | Trademarks | ||||
Business Acquisition [Line Items] | ||||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Finite-Lived Intangibles | 112,000 | |||
KRAVE Pure Foods, Inc. | Other intangible assets | ||||
Business Acquisition [Line Items] | ||||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Finite-Lived Intangibles | $ 17,000 |
BUSINESS ACQUISITIONS AND DIV59
BUSINESS ACQUISITIONS AND DIVESTITURES - MAUNA LOA NARRATIVE (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | ||
Apr. 05, 2015 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||
Proceeds from sale of business | $ 0 | $ 0 | $ 32,408 | |
Disposal Group, Held-for-sale or Disposed of by Sale, Not Discontinued Operations | ||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||
Loss on disposal of business | $ 2,667 | |||
Disposal Group, Held-for-sale or Disposed of by Sale, Not Discontinued Operations | Mauna Loa Macadamia Nut Corporation | ||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||
Proceeds from sale of business | $ 32,408 |
GOODWILL AND INTANGIBLE ASSET60
GOODWILL AND INTANGIBLE ASSETS - SCHEDULE OF CHANGES IN CARRYING VALUE OF GOODWILL BY REPORTABLE SEGMENT (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Goodwill [Line Items] | |||
Goodwill, gross | $ 1,046,600 | ||
Accumulated impairment loss | (362,348) | ||
Goodwill [Roll Forward] | |||
Goodwill, beginning balance | $ 821,061 | $ 812,344 | 684,252 |
Acquired during the period (see Note 2) | 128,110 | ||
Foreign Currency Translation | 8,717 | (18) | |
Goodwill, ending balance | 821,061 | 812,344 | |
Operating Segments | North America | |||
Goodwill [Line Items] | |||
Goodwill, gross | 667,056 | ||
Accumulated impairment loss | (4,973) | ||
Goodwill [Roll Forward] | |||
Goodwill, beginning balance | 799,929 | 792,190 | 662,083 |
Acquired during the period (see Note 2) | 128,110 | ||
Foreign Currency Translation | 7,739 | 1,997 | |
Goodwill, ending balance | 799,929 | 792,190 | |
Operating Segments | International and Other | |||
Goodwill [Line Items] | |||
Goodwill, gross | 379,544 | ||
Accumulated impairment loss | (357,375) | ||
Goodwill [Roll Forward] | |||
Goodwill, beginning balance | 21,132 | 20,154 | $ 22,169 |
Acquired during the period (see Note 2) | 0 | ||
Foreign Currency Translation | 978 | (2,015) | |
Goodwill, ending balance | $ 21,132 | $ 20,154 |
GOODWILL AND INTANGIBLE ASSET61
GOODWILL AND INTANGIBLE ASSETS - GOODWILL AND INTANGIBLE ASSETS NARRATIVE (Details) - USD ($) | 3 Months Ended | 12 Months Ended | |||||
Apr. 02, 2017 | Dec. 31, 2015 | Oct. 04, 2015 | Jul. 05, 2015 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Goodwill [Line Items] | |||||||
Goodwill and indefinite-lived intangible asset impairment charges | $ 0 | $ 4,204,000 | $ 280,802,000 | ||||
Goodwill | $ 684,252,000 | 821,061,000 | 812,344,000 | 684,252,000 | |||
Impairment of Intangible Assets (Excluding Goodwill) | 4,204,000 | ||||||
Amortization expense | 23,376,000 | 26,687,000 | 22,306,000 | ||||
International and Other | CHINA | |||||||
Goodwill [Line Items] | |||||||
Goodwill and indefinite-lived intangible asset impairment charges | 14,393,000 | ||||||
Operating Segments | International and Other | |||||||
Goodwill [Line Items] | |||||||
Goodwill and indefinite-lived intangible asset impairment charges | 0 | 0 | 280,802,000 | ||||
Goodwill | 22,169,000 | 21,132,000 | $ 20,154,000 | 22,169,000 | |||
Shanghai Golden Monkey Food Joint Stock Co., Ltd. | |||||||
Goodwill [Line Items] | |||||||
Goodwill and indefinite-lived intangible asset impairment charges | $ 266,409,000 | $ 249,811,000 | |||||
Purchase price allocation adjustments | $ 16,599,000 | ||||||
Long-lived asset impairment charges | 0 | ||||||
Shanghai Golden Monkey Food Joint Stock Co., Ltd. | International and Other | CHINA | |||||||
Goodwill [Line Items] | |||||||
Goodwill | $ 15,000,000 | $ 15,000,000 | |||||
Margin for Growth Program | |||||||
Goodwill [Line Items] | |||||||
Impairment of Intangible Assets (Excluding Goodwill) | $ 105,992,000 | $ 105,992,000 |
GOODWILL AND INTANGIBLE ASSET62
GOODWILL AND INTANGIBLE ASSETS - SCHEDULE OF GROSS CARRYING AMOUNT AND ACCUMULATED AMORTIZATION FOR EACH MAJOR CLASS OF INTANGIBLE ASSET (Details) - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 31, 2016 |
Finite-Lived Intangible Assets [Line Items] | ||
Finite-lived intangible assets, gross | $ 422,664 | $ 533,858 |
Finite-lived intangible assets, accumulated amortization | (88,144) | (80,640) |
Total other intangible assets | 369,156 | 492,737 |
Trademarks | ||
Finite-Lived Intangible Assets [Line Items] | ||
Indefinite-lived intangible assets, excluding goodwill | 34,636 | 39,519 |
Trademarks | ||
Finite-Lived Intangible Assets [Line Items] | ||
Finite-lived intangible assets, gross | 277,473 | 317,023 |
Finite-lived intangible assets, accumulated amortization | (37,510) | (30,458) |
Customer-related | ||
Finite-Lived Intangible Assets [Line Items] | ||
Finite-lived intangible assets, gross | 128,182 | 200,409 |
Finite-lived intangible assets, accumulated amortization | (34,659) | (36,482) |
Patents | ||
Finite-Lived Intangible Assets [Line Items] | ||
Finite-lived intangible assets, gross | 17,009 | 16,426 |
Finite-lived intangible assets, accumulated amortization | $ (15,975) | $ (13,700) |
GOODWILL AND INTANGIBLE ASSET63
GOODWILL AND INTANGIBLE ASSETS - SCHEDULE OF AMORTIZATION EXPENSE, FOR THE NEXT FIVE YEARS (Details) $ in Thousands | Dec. 31, 2017USD ($) |
Goodwill and Intangible Assets Disclosure [Abstract] | |
2,018 | $ 20,529 |
2,019 | 19,599 |
2,020 | 19,360 |
2,021 | 19,345 |
2,022 | $ 19,345 |
SHORT AND LONG-TERM DEBT - SHOR
SHORT AND LONG-TERM DEBT - SHORT-TERM DEBT NARRATIVE (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2016 | |
Line of Credit Facility [Line Items] | ||
Short-term debt | $ 559,359,000 | $ 632,471,000 |
Short-term debt, weighted average interest rate | 1.70% | 1.00% |
Maximum amount of short term borrowing outstanding | $ 815,588,000 | |
Commercial Paper | ||
Line of Credit Facility [Line Items] | ||
Short-term debt | $ 448,675,000 | $ 473,666,000 |
Short-term debt, weighted average interest rate | 1.40% | 0.60% |
Revolving Credit Facility | Line of Credit | ||
Line of Credit Facility [Line Items] | ||
Line of credit facility, accordion feature increase limit | $ 400,000,000 | |
Debt instrument, covenant, pre-tax income from operations to consolidated interest expense, minimum | 200.00% | |
Revolving Credit Facility | Foreign Line of Credit | ||
Line of Credit Facility [Line Items] | ||
Line of Credit Facility, Maximum Borrowing Capacity | $ 440,148,000 | $ 504,237,000 |
Short-term foreign bank loans against the lines of credit | 110,684,000 | $ 158,805,000 |
Line of Credit | Revolving Credit Facility | Line of Credit | ||
Line of Credit Facility [Line Items] | ||
Line of Credit Facility, Maximum Borrowing Capacity | $ 1,000,000,000 |
SHORT AND LONG-TERM DEBT - SCHE
SHORT AND LONG-TERM DEBT - SCHEDULE OF LONG-TERM DEBT INSTRUMENTS (Details) - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 31, 2016 |
Debt Instrument [Line Items] | ||
Total long-term debt | $ 2,361,121 | $ 2,347,698 |
Net impact of interest rate swaps, debt issuance costs and unamortized debt discounts | (16,427) | (14,275) |
Less—current portion | 300,098 | 243 |
Long-term portion | 2,061,023 | 2,347,455 |
Corporate Debt Securities | 1.60% Notes due 2018 | ||
Debt Instrument [Line Items] | ||
Total long-term debt | 300,000 | 300,000 |
Corporate Debt Securities | 4.125% Notes due 2020 | ||
Debt Instrument [Line Items] | ||
Total long-term debt | 350,000 | 350,000 |
Corporate Debt Securities | 8.8% Debentures due 2021 | ||
Debt Instrument [Line Items] | ||
Total long-term debt | 84,715 | 84,715 |
Corporate Debt Securities | 2.625% Notes due 2023 | ||
Debt Instrument [Line Items] | ||
Total long-term debt | 250,000 | 250,000 |
Corporate Debt Securities | 3.20% Notes due 2025 | ||
Debt Instrument [Line Items] | ||
Total long-term debt | 300,000 | 300,000 |
Corporate Debt Securities | 2.30% Notes due 2026 | ||
Debt Instrument [Line Items] | ||
Total long-term debt | 500,000 | 500,000 |
Corporate Debt Securities | 7.2% Debentures due 2027 | ||
Debt Instrument [Line Items] | ||
Total long-term debt | 193,639 | 193,639 |
Corporate Debt Securities | 3.375% Notes due 2046 | ||
Debt Instrument [Line Items] | ||
Total long-term debt | 300,000 | 300,000 |
Lease Obligations | ||
Debt Instrument [Line Items] | ||
Total long-term debt | $ 99,194 | $ 83,619 |
SHORT AND LONG-TERM DEBT - LONG
SHORT AND LONG-TERM DEBT - LONG TERM DEBT INTEREST RATES (Details) - Corporate Debt Securities | Dec. 31, 2017 | Dec. 31, 2016 | Nov. 30, 2016 | Sep. 30, 2016 | Aug. 31, 2016 | Aug. 31, 2015 |
5.45% Notes due 2016 | ||||||
Debt Instrument [Line Items] | ||||||
Interest rate, stated percentage | 5.45% | 5.45% | 5.45% | |||
1.50% Notes due 2016 | ||||||
Debt Instrument [Line Items] | ||||||
Interest rate, stated percentage | 1.50% | 1.50% | 1.50% | |||
1.60% Notes due 2018 | ||||||
Debt Instrument [Line Items] | ||||||
Interest rate, stated percentage | 1.60% | 1.60% | ||||
4.125% Notes due 2020 | ||||||
Debt Instrument [Line Items] | ||||||
Interest rate, stated percentage | 4.125% | 4.125% | ||||
8.8% Debentures due 2021 | ||||||
Debt Instrument [Line Items] | ||||||
Interest rate, stated percentage | 8.80% | 8.80% | 8.80% | |||
2.625% Notes due 2023 | ||||||
Debt Instrument [Line Items] | ||||||
Interest rate, stated percentage | 2.625% | 2.625% | ||||
3.20% Notes due 2025 | ||||||
Debt Instrument [Line Items] | ||||||
Interest rate, stated percentage | 3.20% | 3.20% | ||||
2.30% Notes due 2026 | ||||||
Debt Instrument [Line Items] | ||||||
Interest rate, stated percentage | 2.30% | 2.30% | 2.30% | |||
7.2% Debentures due 2027 | ||||||
Debt Instrument [Line Items] | ||||||
Interest rate, stated percentage | 7.20% | 7.20% | 7.20% | |||
3.375% Notes due 2046 | ||||||
Debt Instrument [Line Items] | ||||||
Interest rate, stated percentage | 3.375% | 3.375% | 3.375% |
SHORT AND LONG-TERM DEBT - LO67
SHORT AND LONG-TERM DEBT - LONG TERM DEBT NARRATIVE (Details) - USD ($) $ in Thousands | 1 Months Ended | 12 Months Ended | |||||
Nov. 30, 2016 | Sep. 30, 2016 | Aug. 31, 2016 | Aug. 31, 2015 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Debt Instrument [Line Items] | |||||||
Proceeds from Issuance of Other Long-term Debt | $ 792,953 | ||||||
Loss on early extinguishment of debt (see Note 4) | $ 0 | $ 0 | $ 28,326 | ||||
Gain on fair value hedge ineffectiveness | $ 278 | ||||||
Corporate Debt Securities | |||||||
Debt Instrument [Line Items] | |||||||
Debt instrument repurchase amount | 100,165 | ||||||
Extinguishment of debt amount | 71,646 | ||||||
Loss on early extinguishment of debt (see Note 4) | 28,326 | ||||||
8.8% Debentures due 2021 | Corporate Debt Securities | |||||||
Debt Instrument [Line Items] | |||||||
Extinguishment of debt amount | 15,285 | ||||||
7.2% Debentures due 2027 | Corporate Debt Securities | |||||||
Debt Instrument [Line Items] | |||||||
Extinguishment of debt amount | $ 56,361 | ||||||
Corporate Debt Securities | 5.45% Notes due 2016 | |||||||
Debt Instrument [Line Items] | |||||||
Repayments of Debt | $ 250,000 | ||||||
Interest rate, stated percentage | 5.45% | 5.45% | 5.45% | ||||
Corporate Debt Securities | 1.50% Notes due 2016 | |||||||
Debt Instrument [Line Items] | |||||||
Repayments of Debt | $ 250,000 | ||||||
Interest rate, stated percentage | 1.50% | 1.50% | 1.50% | ||||
Corporate Debt Securities | 2.30% Notes due 2026 | |||||||
Debt Instrument [Line Items] | |||||||
Interest rate, stated percentage | 2.30% | 2.30% | 2.30% | ||||
Debt instrument, face amount | $ 500,000 | ||||||
Corporate Debt Securities | 3.375% Notes due 2046 | |||||||
Debt Instrument [Line Items] | |||||||
Interest rate, stated percentage | 3.375% | 3.375% | 3.375% | ||||
Debt instrument, face amount | $ 300,000 | ||||||
Corporate Debt Securities | 8.8% Debentures due 2021 | |||||||
Debt Instrument [Line Items] | |||||||
Interest rate, stated percentage | 8.80% | 8.80% | 8.80% | ||||
Corporate Debt Securities | 7.2% Debentures due 2027 | |||||||
Debt Instrument [Line Items] | |||||||
Interest rate, stated percentage | 7.20% | 7.20% | 7.20% |
SHORT AND LONG-TERM DEBT - SC68
SHORT AND LONG-TERM DEBT - SCHEDULE OF MATURITIES OF LONG-TERM DEBT (Details) $ in Thousands | Dec. 31, 2017USD ($) |
Long-term Debt, Fiscal Year Maturity [Abstract] | |
2,018 | $ 300,098 |
2,019 | 0 |
2,020 | 350,000 |
2,021 | 84,715 |
2,022 | 0 |
Thereafter | $ 1,543,639 |
SHORT AND LONG-TERM DEBT - SC69
SHORT AND LONG-TERM DEBT - SCHEDULE OF NET INTEREST EXPENSE (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Debt Disclosure [Abstract] | |||
Interest expense | $ 104,232 | $ 97,851 | $ 93,520 |
Interest Costs Capitalized Adjustment | 4,166 | 5,903 | 12,537 |
Loss on early extinguishment of debt (see Note 4) | 0 | 0 | 28,326 |
Interest expense | 100,066 | 91,948 | 109,309 |
Interest income | (1,784) | (1,805) | (3,536) |
Interest expense, net | $ 98,282 | $ 90,143 | $ 105,773 |
DERIVATIVE INSTRUMENTS - DERIVA
DERIVATIVE INSTRUMENTS - DERIVATIVE INSTRUMENTS NARRATIVE (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2016 | |
Derivative [Line Items] | ||
Cash flow hedge gain (loss) to be reclassified within twelve months | $ 10,484 | |
Commodities futures and options | Non-designated Hedges | ||
Derivative [Line Items] | ||
Derivative, notional amount | $ 405,288 | $ 739,374 |
Commodities futures and options | Non-designated Hedges | Minimum | ||
Derivative [Line Items] | ||
Derivative, term of contract | 3 months | |
Commodities futures and options | Non-designated Hedges | Maximum | ||
Derivative [Line Items] | ||
Derivative, term of contract | 24 months | |
Foreign exchange contracts | ||
Derivative [Line Items] | ||
Minimum length of time, hedged in cash flow hedge | 3 months | |
Maximum length of time, hedged in cash flow hedge | 12 months | |
Foreign exchange contracts | Designated as Hedging Instrument | Cash Flow Hedges | ||
Derivative [Line Items] | ||
Derivative, notional amount | $ 135,962 | 68,263 |
Foreign exchange contracts | Non-designated Hedges | ||
Derivative [Line Items] | ||
Derivative, notional amount | 2,791 | 2,791 |
Interest rate swap agreements | Designated as Hedging Instrument | Cash Flow Hedges | ||
Derivative [Line Items] | ||
Derivative, notional amount | 500,000 | |
Increase (Decrease) in Derivative Assets and Liabilities | 87,000 | |
Interest rate swap agreements | Designated as Hedging Instrument | Fair Value Hedging | ||
Derivative [Line Items] | ||
Derivative, notional amount | 350,000 | 350,000 |
Deferred compensation derivatives | ||
Derivative [Line Items] | ||
Derivative, notional amount | $ 25,246 | 22,099 |
Deferred compensation derivatives | Non-designated Hedges | Minimum | ||
Derivative [Line Items] | ||
Derivative, term of contract | 3 months | |
Deferred compensation derivatives | Non-designated Hedges | Maximum | ||
Derivative [Line Items] | ||
Derivative, term of contract | 12 months | |
Interest Rate Swap [Member] | Designated as Hedging Instrument | Fair Value Hedging | Interest Expense | ||
Derivative [Line Items] | ||
Fair value hedges, pre-tax benefit | $ 2,660 | $ 4,365 |
DERIVATIVE INSTRUMENTS - SCHEDU
DERIVATIVE INSTRUMENTS - SCHEDULE OF THE CLASSIFICATION OF DERIVATIVE ASSETS AND LIABILITIES WITHIN THE CONSOLIDATED BALANCE SHEETS (Details) - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 31, 2016 |
Derivatives, Fair Value [Line Items] | ||
Derivative asset | $ 2,425 | $ 7,062 |
Derivative liability | 6,378 | 10,825 |
Designated as Hedging Instrument | Cash Flow Hedges | Foreign exchange contracts | ||
Derivatives, Fair Value [Line Items] | ||
Derivative asset | 423 | 2,229 |
Derivative liability | 1,427 | 809 |
Designated as Hedging Instrument | Fair Value Hedging | Interest rate swap agreements | ||
Derivatives, Fair Value [Line Items] | ||
Derivative asset | 0 | 1,768 |
Derivative liability | 1,897 | 0 |
Non-designated Hedges | ||
Derivatives, Fair Value [Line Items] | ||
Derivative asset | 2,002 | 3,065 |
Derivative liability | 3,054 | 10,016 |
Non-designated Hedges | Commodities futures and options | ||
Derivatives, Fair Value [Line Items] | ||
Derivative asset | 390 | 2,348 |
Derivative liability | 3,054 | 10,000 |
Gross derivative assets, included within derivative liabilities | 48,505 | 140,885 |
Derivative liability, gross liabilities | 50,179 | 150,872 |
Non-designated Hedges | Foreign exchange contracts | ||
Derivatives, Fair Value [Line Items] | ||
Derivative asset | 31 | 0 |
Derivative liability | 0 | 16 |
Non-designated Hedges | Deferred compensation derivatives | ||
Derivatives, Fair Value [Line Items] | ||
Derivative asset | 1,581 | 717 |
Derivative liability | $ 0 | $ 0 |
DERIVATIVE INSTRUMENTS - SCHE72
DERIVATIVE INSTRUMENTS - SCHEDULE OF THE EFFECT OF DERIVATIVE INSTRUMENTS ON THE CONSOLIDATED STATEMENTS OF INCOME (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2016 | |
Derivative [Line Items] | ||
Derivative Instruments Not Designated as Hedging Instruments, Gain (Loss), Net | $ (51,260) | $ (169,596) |
Commodities futures and options | ||
Derivative [Line Items] | ||
Derivative Instruments Not Designated as Hedging Instruments, Gain (Loss), Net | (55,734) | (171,753) |
Foreign exchange contracts | ||
Derivative [Line Items] | ||
Derivative Instruments Not Designated as Hedging Instruments, Gain (Loss), Net | (23) | (46) |
Interest rate swap agreements | ||
Derivative [Line Items] | ||
Derivative Instruments Not Designated as Hedging Instruments, Gain (Loss), Net | 0 | 0 |
Deferred compensation derivatives | ||
Derivative [Line Items] | ||
Derivative Instruments Not Designated as Hedging Instruments, Gain (Loss), Net | 4,497 | 2,203 |
Designated as Hedging Instrument | Cash Flow Hedges | ||
Derivative [Line Items] | ||
Gains (losses) recognized in other comprehensive income (“OCI”) (effective portion) | (4,931) | (52,708) |
Gains (losses) reclassified from accumulated OCI into income (effective portion) | (14,434) | 16,482 |
Designated as Hedging Instrument | Cash Flow Hedges | Commodities futures and options | ||
Derivative [Line Items] | ||
Gains (losses) recognized in other comprehensive income (“OCI”) (effective portion) | 0 | 0 |
Gains (losses) reclassified from accumulated OCI into income (effective portion) | (1,774) | 30,783 |
Designated as Hedging Instrument | Cash Flow Hedges | Foreign exchange contracts | ||
Derivative [Line Items] | ||
Gains (losses) recognized in other comprehensive income (“OCI”) (effective portion) | (4,931) | (5,485) |
Gains (losses) reclassified from accumulated OCI into income (effective portion) | (3,180) | (5,625) |
Designated as Hedging Instrument | Cash Flow Hedges | Interest rate swap agreements | ||
Derivative [Line Items] | ||
Gains (losses) recognized in other comprehensive income (“OCI”) (effective portion) | 0 | (47,223) |
Gains (losses) reclassified from accumulated OCI into income (effective portion) | (9,480) | (8,676) |
Designated as Hedging Instrument | Cash Flow Hedges | Deferred compensation derivatives | ||
Derivative [Line Items] | ||
Gains (losses) recognized in other comprehensive income (“OCI”) (effective portion) | 0 | 0 |
Gains (losses) reclassified from accumulated OCI into income (effective portion) | $ 0 | $ 0 |
FAIR VALUE MEASUREMENTS - SCHED
FAIR VALUE MEASUREMENTS - SCHEDULE OF ASSETS AND LIABILITIES MEASURED AT FAIR VALUE (Details) - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 31, 2016 |
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Derivative asset | $ 2,425 | $ 7,062 |
Derivative liability | 6,378 | 10,825 |
Fair Value, Measurements, Recurring | Foreign exchange contracts | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Derivative asset | 454 | 2,229 |
Derivative liability | 1,427 | 825 |
Fair Value, Measurements, Recurring | Foreign exchange contracts | Quoted prices in active markets of identical assets (Level 1) | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Derivative asset | 0 | 0 |
Derivative liability | 0 | 0 |
Fair Value, Measurements, Recurring | Foreign exchange contracts | Significant other observable inputs (Level 2) | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Derivative asset | 454 | 2,229 |
Derivative liability | 1,427 | 825 |
Fair Value, Measurements, Recurring | Foreign exchange contracts | Significant other unobservable inputs (Level 3) | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Derivative asset | 0 | 0 |
Derivative liability | 0 | 0 |
Fair Value, Measurements, Recurring | Interest rate swap agreements | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Derivative asset | 1,768 | |
Derivative liability | 1,897 | |
Fair Value, Measurements, Recurring | Interest rate swap agreements | Quoted prices in active markets of identical assets (Level 1) | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Derivative asset | 0 | |
Derivative liability | 0 | |
Fair Value, Measurements, Recurring | Interest rate swap agreements | Significant other observable inputs (Level 2) | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Derivative asset | 1,768 | |
Derivative liability | 1,897 | |
Fair Value, Measurements, Recurring | Interest rate swap agreements | Significant other unobservable inputs (Level 3) | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Derivative asset | 0 | |
Derivative liability | 0 | |
Fair Value, Measurements, Recurring | Deferred compensation derivatives | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Derivative asset | 1,581 | 717 |
Fair Value, Measurements, Recurring | Deferred compensation derivatives | Quoted prices in active markets of identical assets (Level 1) | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Derivative asset | 0 | 0 |
Fair Value, Measurements, Recurring | Deferred compensation derivatives | Significant other observable inputs (Level 2) | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Derivative asset | 1,581 | 717 |
Fair Value, Measurements, Recurring | Deferred compensation derivatives | Significant other unobservable inputs (Level 3) | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Derivative asset | 0 | 0 |
Fair Value, Measurements, Recurring | Commodities futures and options | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Derivative asset | 390 | 2,348 |
Derivative liability | 3,054 | 10,000 |
Fair Value, Measurements, Recurring | Commodities futures and options | Quoted prices in active markets of identical assets (Level 1) | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Derivative asset | 390 | 2,348 |
Derivative liability | 3,054 | 10,000 |
Fair Value, Measurements, Recurring | Commodities futures and options | Significant other observable inputs (Level 2) | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Derivative asset | 0 | 0 |
Derivative liability | 0 | 0 |
Fair Value, Measurements, Recurring | Commodities futures and options | Significant other unobservable inputs (Level 3) | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Derivative asset | 0 | 0 |
Derivative liability | $ 0 | $ 0 |
FAIR VALUE MEASUREMENTS - SCH74
FAIR VALUE MEASUREMENTS - SCHEDULE OF FAIR VALUES AND CARRYING VALUES OF LONG-TERM DEBT (Details) - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 31, 2016 |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Current portion of long-term debt | $ 300,098 | $ 243 |
Long-term portion | 2,061,023 | 2,347,455 |
Long-term Debt | 2,361,121 | 2,347,698 |
Significant other observable inputs (Level 2) | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Long-term Debt, Current Maturities, Fair Value | 299,430 | 243 |
Current portion of long-term debt | 300,098 | 243 |
Long-term Debt, Excluding Current Maturities, Fair Value | 2,113,296 | 2,379,054 |
Long-term portion | 2,061,023 | 2,347,455 |
Long-term Debt, Fair Value | 2,412,726 | 2,379,297 |
Long-term Debt | $ 2,361,121 | $ 2,347,698 |
FAIR VALUE MEASUREMENTS - FAIR
FAIR VALUE MEASUREMENTS - FAIR VALUE MEASUREMENTS NARRATIVE (Details) - USD ($) | 3 Months Ended | 12 Months Ended | |
Apr. 02, 2017 | Dec. 31, 2017 | Dec. 31, 2016 | |
Derivative [Line Items] | |||
Impairment of Intangible Assets (Excluding Goodwill) | $ 4,204,000 | ||
Margin for Growth Program | |||
Derivative [Line Items] | |||
Impairment of Intangible Assets (Excluding Goodwill) | $ 105,992,000 | $ 105,992,000 | |
Impairment of Long-Lived Assets Held-for-use | $ 102,720,000 | 102,720,000 | |
Significant other unobservable inputs (Level 3) | |||
Derivative [Line Items] | |||
Fair Value, Net Asset (Liability) | $ 0 | $ 0 |
BUSINESS REALIGNMENT ACTIVITI76
BUSINESS REALIGNMENT ACTIVITIES - SCHEDULE OF BUSINESS REALIGNMENT ACTIVITY (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Restructuring Cost and Reserve [Line Items] | |||
Business realignment costs | $ 69,359,000 | $ 107,571,000 | $ 120,975,000 |
Cost of Sales | |||
Restructuring Cost and Reserve [Line Items] | |||
Business realignment costs | 5,147,000 | 58,106,000 | 8,801,000 |
Selling, marketing and administrative | |||
Restructuring Cost and Reserve [Line Items] | |||
Business realignment costs | 16,449,000 | 16,939,000 | 17,368,000 |
Business realignment charges | |||
Restructuring Cost and Reserve [Line Items] | |||
Business realignment costs | 47,763,000 | 32,526,000 | 94,806,000 |
Operation optimization program | |||
Restructuring Cost and Reserve [Line Items] | |||
Business realignment costs | 13,525,000 | ||
Mauna Loa Macadamia Nut Corporation | |||
Restructuring Cost and Reserve [Line Items] | |||
Business realignment costs | 0 | 0 | 2,667,000 |
Severance | Margin for Growth Program | |||
Restructuring Cost and Reserve [Line Items] | |||
Business realignment costs | 32,554,000 | 0 | 0 |
Severance | Operation optimization program | |||
Restructuring Cost and Reserve [Line Items] | |||
Business realignment costs | 13,828,000 | 17,872,000 | 0 |
Severance | 2015 productivity initiative | |||
Restructuring Cost and Reserve [Line Items] | |||
Business realignment costs | 0 | 0 | 81,290,000 |
Severance | Other international restructuring programs | |||
Restructuring Cost and Reserve [Line Items] | |||
Business realignment costs | 0 | 0 | 6,651,000 |
Accelerated depreciation and amortization | Margin for Growth Program | |||
Restructuring Cost and Reserve [Line Items] | |||
Business realignment costs | 6,873,000 | 0 | 0 |
Accelerated depreciation and amortization | Operation optimization program | |||
Restructuring Cost and Reserve [Line Items] | |||
Business realignment costs | 0 | 48,590,000 | 0 |
Accelerated depreciation and amortization | Other international restructuring programs | |||
Restructuring Cost and Reserve [Line Items] | |||
Business realignment costs | 0 | 0 | 5,904,000 |
Other program costs | Margin for Growth Program | |||
Restructuring Cost and Reserve [Line Items] | |||
Business realignment costs | 16,407,000 | 0 | 0 |
Other program costs | Operation optimization program | |||
Restructuring Cost and Reserve [Line Items] | |||
Business realignment costs | (303,000) | 21,831,000 | 0 |
Other program costs | 2015 productivity initiative | |||
Restructuring Cost and Reserve [Line Items] | |||
Business realignment costs | 0 | 5,609,000 | 14,285,000 |
Pension settlement charge | 2015 productivity initiative | |||
Restructuring Cost and Reserve [Line Items] | |||
Business realignment costs | $ 0 | $ 13,669,000 | $ 10,178,000 |
BUSINESS REALIGNMENT ACTIVITI77
BUSINESS REALIGNMENT ACTIVITIES - BUSINESS REALIGNMENT ACTIVITIES NARRATIVE (Details) | 1 Months Ended | 3 Months Ended | 6 Months Ended | 12 Months Ended | ||
Feb. 28, 2017USD ($) | Apr. 02, 2017USD ($) | Dec. 31, 2015employee | Dec. 31, 2017USD ($) | Dec. 31, 2016USD ($) | Dec. 31, 2015USD ($) | |
Restructuring Cost and Reserve [Line Items] | ||||||
Impairment of Intangible Assets (Excluding Goodwill) | $ 4,204,000 | |||||
Long-lived asset impairment charges | $ 208,712,000 | 0 | $ 0 | |||
Business realignment costs | 69,359,000 | 107,571,000 | 120,975,000 | |||
Margin for Growth Program | ||||||
Restructuring Cost and Reserve [Line Items] | ||||||
Impairment of Intangible Assets (Excluding Goodwill) | $ 105,992,000 | 105,992,000 | ||||
Restructuring and Related Cost, Expected Number of Positions Eliminated, Percent | 15.00% | |||||
Long-lived asset impairment charges | 208,712,000 | |||||
Impairment of Long-Lived Assets Held-for-use | $ 102,720,000 | 102,720,000 | ||||
Margin for Growth Program | Severance | ||||||
Restructuring Cost and Reserve [Line Items] | ||||||
Business realignment costs | 32,554,000 | 0 | 0 | |||
Margin for Growth Program | Accelerated depreciation and amortization | ||||||
Restructuring Cost and Reserve [Line Items] | ||||||
Business realignment costs | 6,873,000 | 0 | 0 | |||
Margin for Growth Program | Contract Termination | ||||||
Restructuring Cost and Reserve [Line Items] | ||||||
Restructuring and related cost, expected cost | $ 25,000,000 | |||||
Margin for Growth Program | Other program costs | ||||||
Restructuring Cost and Reserve [Line Items] | ||||||
Business realignment costs | 16,407,000 | 0 | 0 | |||
Operation optimization program | ||||||
Restructuring Cost and Reserve [Line Items] | ||||||
Restructuring and related cost, expected cost | 8,000,000 | |||||
Business realignment costs | $ 13,525,000 | |||||
Restructuring and Related Cost, Period of Incurred Restructuring Costs | 12 months | |||||
Operation optimization program | Severance | ||||||
Restructuring Cost and Reserve [Line Items] | ||||||
Business realignment costs | $ 13,828,000 | 17,872,000 | 0 | |||
Operation optimization program | Accelerated depreciation and amortization | ||||||
Restructuring Cost and Reserve [Line Items] | ||||||
Business realignment costs | 0 | 48,590,000 | 0 | |||
Operation optimization program | Other program costs | ||||||
Restructuring Cost and Reserve [Line Items] | ||||||
Business realignment costs | (303,000) | 21,831,000 | 0 | |||
2015 productivity initiative | ||||||
Restructuring Cost and Reserve [Line Items] | ||||||
Restructuring and Related Cost, Expected Number of Positions Eliminated | employee | 300 | |||||
Restructuring and Related Cost, Cost Incurred to Date | 125,031,000 | |||||
2015 productivity initiative | Severance | ||||||
Restructuring Cost and Reserve [Line Items] | ||||||
Business realignment costs | 0 | 0 | 81,290,000 | |||
2015 productivity initiative | Other program costs | ||||||
Restructuring Cost and Reserve [Line Items] | ||||||
Business realignment costs | $ 0 | 5,609,000 | 14,285,000 | |||
2015 productivity initiative | One-time Termination Benefits | ||||||
Restructuring Cost and Reserve [Line Items] | ||||||
Business realignment costs | $ 13,669,000 | $ 10,178,000 | ||||
Business realignment charges | Geographic Concentration Risk | North America | Margin for Growth Program | ||||||
Restructuring Cost and Reserve [Line Items] | ||||||
Concentration Risk, Percentage | 45.00% | |||||
Business realignment charges | Geographic Concentration Risk | North America | Operation optimization program | ||||||
Restructuring Cost and Reserve [Line Items] | ||||||
Concentration Risk, Percentage | 35.00% | |||||
Business realignment charges | Geographic Concentration Risk | International and Other | Margin for Growth Program | ||||||
Restructuring Cost and Reserve [Line Items] | ||||||
Concentration Risk, Percentage | 55.00% | |||||
Business realignment charges | Geographic Concentration Risk | International and Other | Operation optimization program | ||||||
Restructuring Cost and Reserve [Line Items] | ||||||
Concentration Risk, Percentage | 65.00% | |||||
Minimum | Margin for Growth Program | ||||||
Restructuring Cost and Reserve [Line Items] | ||||||
Restructuring and related cost, expected cost | 375,000,000 | |||||
Impairment of Intangible Assets (Excluding Goodwill) | 100,000,000 | |||||
Effect on Future Cash Flows, Amount | 150,000,000 | |||||
Minimum | Margin for Growth Program | Facility Closing | ||||||
Restructuring Cost and Reserve [Line Items] | ||||||
Restructuring and related cost, expected cost | 100,000,000 | |||||
Minimum | Margin for Growth Program | Severance | ||||||
Restructuring Cost and Reserve [Line Items] | ||||||
Restructuring and related cost, expected cost | 80,000,000 | |||||
Minimum | Margin for Growth Program | Other program costs | ||||||
Restructuring Cost and Reserve [Line Items] | ||||||
Restructuring and related cost, expected cost | 70,000,000 | |||||
Maximum | Margin for Growth Program | ||||||
Restructuring Cost and Reserve [Line Items] | ||||||
Restructuring and related cost, expected cost | 425,000,000 | |||||
Impairment of Intangible Assets (Excluding Goodwill) | 110,000,000 | |||||
Effect on Future Cash Flows, Amount | 175,000,000 | |||||
Maximum | Margin for Growth Program | Facility Closing | ||||||
Restructuring Cost and Reserve [Line Items] | ||||||
Restructuring and related cost, expected cost | 115,000,000 | |||||
Maximum | Margin for Growth Program | Severance | ||||||
Restructuring Cost and Reserve [Line Items] | ||||||
Restructuring and related cost, expected cost | 100,000,000 | |||||
Maximum | Margin for Growth Program | Other program costs | ||||||
Restructuring Cost and Reserve [Line Items] | ||||||
Restructuring and related cost, expected cost | $ 75,000,000 |
BUSINESS REALIGNMENT ACTIVITI78
BUSINESS REALIGNMENT ACTIVITIES - SCHEDULE OF LIABILITY ACTIVITY FOR COSTS QUALIFYING AS EXIT AND DISPOSAL COSTS (Details) $ in Thousands | 12 Months Ended |
Dec. 31, 2017USD ($) | |
Restructuring Reserve [Roll Forward] | |
Liability balance at December 31, 2016 | $ 3,725 |
2017 business realignment charges | 61,872 |
Cash payments | (26,536) |
Other, net | (69) |
Liability balance at December 31, 2017 | $ 38,992 |
INCOME TAXES - SCHEDULE OF INCO
INCOME TAXES - SCHEDULE OF INCOME (LOSS) BEFORE TAXES (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Income Tax Disclosure [Abstract] | |||
Domestic | $ 1,187,825 | $ 1,395,440 | $ 1,357,618 |
Foreign | (77,157) | (295,959) | (455,771) |
Income before income taxes | $ 1,110,668 | $ 1,099,481 | $ 901,847 |
INCOME TAXES - SCHEDULE OF COMP
INCOME TAXES - SCHEDULE OF COMPONENTS OF INCOME TAX EXPENSE (BENEFIT) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Current: | |||
Federal | $ 314,277 | $ 391,705 | $ 409,060 |
State | 37,628 | 51,706 | 47,978 |
Foreign | (16,356) | (25,877) | (29,605) |
Current provision for income taxes | 335,549 | 417,534 | 427,433 |
Deferred: | |||
Federal | 19,204 | (7,706) | (31,153) |
State | 7,573 | (452) | (2,346) |
Foreign | (8,195) | (29,939) | (5,038) |
Deferred income tax provision | 18,582 | (38,097) | (38,537) |
Total provision for income taxes | $ 354,131 | $ 379,437 | $ 388,896 |
INCOME TAXES - INCOME TAXES NAR
INCOME TAXES - INCOME TAXES NARRATIVE (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Income Tax Contingency [Line Items] | ||||
Tax Cuts and Jobs Act of 2017, change in tax rate, income tax expense | $ 32,500 | |||
Amount of unrecognized tax benefits that if recognized would affect the effective tax rate | 37,587 | $ 37,587 | $ 27,691 | |
Net tax expense (benefit) for interest and penalties | (795) | 75 | $ (1,153) | |
Accrued net interest and penalties | 4,966 | 4,966 | 3,716 | |
Expected reduction in the liability for unrecognized tax benefits within the next 12 months | 8,089 | 8,089 | ||
Undistributed earnings of foreign subsidiaries | $ 370,027 | 370,027 | ||
Investment tax credits and related tax depreciation benefits | 74,600 | 52,342 | ||
Write-down of equity investments in partnerships qualifying for historic tax credits | 66,209 | 43,482 | $ 39,489 | |
Other Nonoperating Income (Expense) | Partnerships Qualifying For Tax Credits | ||||
Income Tax Contingency [Line Items] | ||||
Write-down of equity investments in partnerships qualifying for historic tax credits | $ 66,209 | $ 43,482 |
INCOME TAXES - SCHEDULE OF DEFE
INCOME TAXES - SCHEDULE OF DEFERRED TAX ASSET AND LIABILITIES (Details) - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 31, 2016 |
Deferred tax assets: | ||
Post-retirement benefit obligations | $ 58,306 | $ 90,584 |
Accrued expenses and other reserves | 103,769 | 141,228 |
Stock-based compensation | 31,364 | 48,500 |
Derivative instruments | 27,109 | 44,010 |
Pension | 0 | 14,662 |
Lease financing obligation | 12,310 | 18,950 |
Accrued trade promotion reserves | 26,028 | 50,463 |
Net operating loss carryforwards | 226,142 | 143,085 |
Capital loss carryforwards | 23,215 | 38,691 |
Other | 7,748 | 14,452 |
Gross deferred tax assets | 515,991 | 604,625 |
Valuation allowance | (312,148) | (235,485) |
Total deferred tax assets | 203,843 | 369,140 |
Deferred tax liabilities: | ||
Property, plant and equipment, net | 132,443 | 202,300 |
Acquired intangibles | 68,476 | 113,074 |
Inventories | 20,769 | 27,608 |
Pension | 969 | 0 |
Other | 23,819 | 8,884 |
Total deferred tax liabilities | 246,476 | 351,866 |
Net deferred tax liabilities | (42,633) | |
Net deferred tax assets | 17,274 | |
Included in: | ||
Non-current deferred tax assets, net | 3,023 | 56,861 |
Non-current deferred tax liabilities, net | $ (45,656) | $ (39,587) |
INCOME TAXES - SCHEDULE OF EFFE
INCOME TAXES - SCHEDULE OF EFFECTIVE INCOME TAX RATE RECONCILIATION (Details) | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Income Tax Disclosure [Abstract] | |||
Federal statutory income tax rate | 35.00% | 35.00% | 35.00% |
State income taxes, net of Federal income tax benefits | 2.60% | 3.40% | 4.20% |
Qualified production income deduction | (2.90%) | (3.80%) | (4.40%) |
Business realignment and impairment charges and gain on sale of trademark licensing rights | 4.30% | 0.40% | 10.80% |
Foreign rate differences | (4.30%) | 3.60% | 2.20% |
Historic and solar tax credits | (4.80%) | (3.30%) | (3.30%) |
U.S. tax reform | 2.90% | 0.00% | 0.00% |
Other, net | (0.90%) | (0.80%) | (1.40%) |
Effective income tax rate | 31.90% | 34.50% | 43.10% |
INCOME TAXES - SCHEDULE OF UNRE
INCOME TAXES - SCHEDULE OF UNRECOGNIZED TAX BENEFITS ROLL FORWARD (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2016 | |
Reconciliation of Unrecognized Tax Benefits, Excluding Amounts Pertaining to Examined Tax Returns [Roll Forward] | ||
Balance at beginning of year | $ 36,002 | $ 33,411 |
Additions for tax positions taken during prior years | 2,492 | 2,804 |
Reductions for tax positions taken during prior years | (1,689) | (4,080) |
Additions for tax positions taken during the current year | 10,018 | 9,100 |
Settlements | (1,481) | 0 |
Expiration of statutes of limitations | (3,260) | (5,233) |
Balance at end of year | $ 42,082 | $ 36,002 |
PENSION AND OTHER POST-RETIRE85
PENSION AND OTHER POST-RETIREMENT BENEFIT PLANS - PENSION AND OTHER POST-RETIREMENT BENEFIT PLANS NARRATIVE (Details) $ in Thousands | 12 Months Ended | ||||
Dec. 31, 2017USD ($)postretirement_plan | Dec. 31, 2016USD ($) | Dec. 31, 2015USD ($) | Dec. 31, 2023 | Dec. 31, 2021 | |
Defined Benefit Plan Disclosure [Line Items] | |||||
Number of defined benefit, other post-retirement plans, and defined contribution other post-retirement plans (postretirement plan) | postretirement_plan | 2 | ||||
Defined benefit plan, accumulated benefit obligation | $ 1,077,112 | $ 1,081,261 | |||
Defined contribution pan, cost recognized | 46,154 | 43,545 | $ 44,285 | ||
Pro Forma | |||||
Defined Benefit Plan Disclosure [Line Items] | |||||
Defined benefit plan, effect of change in interest method on service and interest cost components | 5,800 | ||||
Pension Benefits | |||||
Defined Benefit Plan Disclosure [Line Items] | |||||
Employer contributions | 37,503 | $ 21,580 | |||
Defined benefit plans, minimum future employer contributions in next fiscal year | 1,591 | ||||
Pension Benefits | Unfunded Plan | Hershey Company Puerto Rico Hourly Pension Plan | |||||
Defined Benefit Plan Disclosure [Line Items] | |||||
Employer contributions | 6,461 | ||||
Supplemental Employee Retirement Plan | |||||
Defined Benefit Plan Disclosure [Line Items] | |||||
Employer contributions | $ 29,201 | ||||
Other Benefits | |||||
Defined Benefit Plan Disclosure [Line Items] | |||||
Defined Benefit Plan, Health Care Cost Trend Rate Assumed, Next Fiscal Year | 7.00% | 7.00% | |||
Employer contributions | $ 18,930 | $ 20,117 | |||
Other Benefits | Scenario, Forecast | |||||
Defined Benefit Plan Disclosure [Line Items] | |||||
Defined benefit plan, ultimate health care cost trend rate | 5.00% | 5.00% |
PENSION AND OTHER POST-RETIRE86
PENSION AND OTHER POST-RETIREMENT BENEFIT PLANS - SCHEDULE OF DEFINED BENEFIT OBLIGATIONS, PLAN ASSETS AND FUNDED STATUS (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Amounts recognized in Accumulated Other Comprehensive Income (Loss), net of tax: | |||
Net amounts recognized in AOCI | $ 169,526 | $ 207,169 | |
Pension Benefits | |||
Change in benefit obligation | |||
Projected benefit obligation at beginning of year | 1,118,318 | 1,169,424 | |
Service cost | 20,657 | 23,075 | $ 28,300 |
Interest cost | 40,996 | 41,875 | 44,179 |
Plan amendments | (8,473) | (43,065) | |
Actuarial (gain) loss | 40,768 | 15,804 | |
Settlement | (44,978) | (59,784) | |
Currency translation and other | 6,749 | 1,416 | |
Benefits paid | 56,473 | 30,427 | |
Projected benefit obligation at end of year | 1,117,564 | 1,118,318 | 1,169,424 |
Change in plan assets | |||
Fair value of plan assets at beginning of year | 1,023,676 | 1,041,902 | |
Actual return on plan assets | 121,241 | 49,012 | |
Employer contributions | 37,503 | 21,580 | |
Settlement | (44,978) | (59,784) | |
Currency translation and other | 5,257 | 1,393 | |
Benefits paid | 56,473 | 30,427 | |
Fair value of plan assets at end of year | 1,086,226 | 1,023,676 | 1,041,902 |
Funded status at end of year | (31,338) | (94,642) | |
Amounts recognized in the Consolidated Balance Sheets: | |||
Other assets | 14,988 | 39 | |
Accrued liabilities | (6,916) | (28,994) | |
Other long-term liabilities | (39,410) | (65,687) | |
Total | (31,338) | (94,642) | |
Amounts recognized in Accumulated Other Comprehensive Income (Loss), net of tax: | |||
Actuarial net (loss) gain | (207,659) | (243,228) | |
Net prior service credit (cost) | 30,994 | 28,360 | |
Net amounts recognized in AOCI | (176,665) | (214,868) | |
Other Benefits | |||
Change in benefit obligation | |||
Projected benefit obligation at beginning of year | 242,846 | 255,617 | |
Service cost | 263 | 299 | 542 |
Interest cost | 8,837 | 9,731 | 10,187 |
Plan amendments | 0 | 0 | |
Actuarial (gain) loss | 2,207 | (2,998) | |
Settlement | 0 | 0 | |
Currency translation and other | 889 | 314 | |
Benefits paid | 18,930 | 20,117 | |
Projected benefit obligation at end of year | 236,112 | 242,846 | 255,617 |
Change in plan assets | |||
Fair value of plan assets at beginning of year | 0 | 0 | |
Actual return on plan assets | 0 | 0 | |
Employer contributions | 18,930 | 20,117 | |
Settlement | 0 | 0 | |
Currency translation and other | 0 | 0 | |
Benefits paid | 18,930 | 20,117 | |
Fair value of plan assets at end of year | 0 | 0 | $ 0 |
Funded status at end of year | (236,112) | (242,846) | |
Amounts recognized in the Consolidated Balance Sheets: | |||
Other assets | 0 | 0 | |
Accrued liabilities | (20,792) | (22,576) | |
Other long-term liabilities | (215,320) | (220,270) | |
Total | (236,112) | (242,846) | |
Amounts recognized in Accumulated Other Comprehensive Income (Loss), net of tax: | |||
Actuarial net (loss) gain | 8,313 | 9,264 | |
Net prior service credit (cost) | (1,174) | (1,565) | |
Net amounts recognized in AOCI | $ 7,139 | $ 7,699 |
PENSION AND OTHER POST-RETIRE87
PENSION AND OTHER POST-RETIREMENT BENEFIT PLANS - SCHEDULE OF ACCUMULATED BENEFIT OBLIGATIONS IN EXCESS OF PLAN ASSETS (Details) - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 31, 2016 |
Retirement Benefits [Abstract] | ||
Projected benefit obligation | $ 711,767 | $ 1,118,294 |
Accumulated benefit obligation | 675,660 | 1,081,254 |
Fair value of plan assets | $ 665,441 | $ 1,023,613 |
PENSION AND OTHER POST-RETIRE88
PENSION AND OTHER POST-RETIREMENT BENEFIT PLANS - SCHEDULE OF COMPONENTS OF NET PERIODIC BENEFIT COST (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Pension Benefits | |||
Amounts recognized in net periodic benefit cost | |||
Service cost | $ 20,657 | $ 23,075 | $ 28,300 |
Interest cost | 40,996 | 41,875 | 44,179 |
Expected return on plan assets | (57,370) | (58,820) | (68,830) |
Amortization of prior service (credit) cost | (5,822) | (1,555) | (1,178) |
Amortization of net loss (gain) | 33,648 | 34,940 | 30,510 |
Curtailment credit | 0 | 0 | (688) |
Settlement loss | 17,732 | 22,657 | 23,067 |
Total net periodic benefit cost | 49,841 | 62,172 | 55,360 |
Change in plan assets and benefit obligations recognized in AOCI, pre-tax | |||
Actuarial net (gain) loss | (73,768) | (31,772) | (21,554) |
Prior service (credit) cost | (2,650) | (41,517) | 1,748 |
Total recognized in other comprehensive (income) loss, pre-tax | (76,418) | (73,289) | (19,806) |
Net amounts recognized in periodic benefit cost and AOCI | (26,577) | (11,117) | 35,554 |
Other Benefits | |||
Amounts recognized in net periodic benefit cost | |||
Service cost | 263 | 299 | 542 |
Interest cost | 8,837 | 9,731 | 10,187 |
Expected return on plan assets | 0 | 0 | 0 |
Amortization of prior service (credit) cost | 748 | 575 | 611 |
Amortization of net loss (gain) | (1) | (13) | (57) |
Curtailment credit | 0 | 0 | 204 |
Settlement loss | 0 | 0 | 0 |
Total net periodic benefit cost | 9,847 | 10,592 | 11,487 |
Change in plan assets and benefit obligations recognized in AOCI, pre-tax | |||
Actuarial net (gain) loss | 2,139 | (3,047) | (26,270) |
Prior service (credit) cost | (744) | (572) | (834) |
Total recognized in other comprehensive (income) loss, pre-tax | 1,395 | (3,619) | (27,104) |
Net amounts recognized in periodic benefit cost and AOCI | $ 11,242 | $ 6,973 | $ (15,617) |
PENSION AND OTHER POST-RETIRE89
PENSION AND OTHER POST-RETIREMENT BENEFIT PLANS - SCHEDULE OF AMOUNTS EXPECTED TO BE AMORTIZED FROM AOCI INTO NET PERIODIC BENEFIT (Details) $ in Thousands | Dec. 31, 2017USD ($) |
Pension Benefits | |
Defined Benefit Plan Disclosure [Line Items] | |
Amortization of net actuarial loss | $ 26,735 |
Amortization of prior service (credit) cost | (7,197) |
Other Benefits | |
Defined Benefit Plan Disclosure [Line Items] | |
Amortization of net actuarial loss | 0 |
Amortization of prior service (credit) cost | $ 836 |
PENSION AND OTHER POST-RETIRE90
PENSION AND OTHER POST-RETIREMENT BENEFIT PLANS - SCHEDULE OF WEIGHTED AVERAGE ASSUMPTIONS USED IN COMPUTING BENEFIT OBLIGATIONS (Details) | Dec. 31, 2017 | Dec. 31, 2016 |
Pension Benefits | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Discount rate | 3.40% | 3.80% |
Rate of increase in compensation levels | 3.80% | 3.80% |
Other Benefits | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Discount rate | 3.50% | 3.80% |
PENSION AND OTHER POST-RETIRE91
PENSION AND OTHER POST-RETIREMENT BENEFIT PLANS - SCHEDULE OF WEIGHTED AVERAGE ASSUMPTIONS USED IN COMPUTING NET PERIODIC BENEFIT COST (Details) | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Pension Benefits | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Discount rate | 3.80% | 4.00% | 3.70% |
Expected long-term return on plan assets | 5.80% | 6.10% | 6.30% |
Rate of compensation increase | 3.80% | 3.80% | 4.10% |
Other Benefits | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Discount rate | 3.80% | 4.00% | 3.70% |
PENSION AND OTHER POST-RETIRE92
PENSION AND OTHER POST-RETIREMENT BENEFIT PLANS - SCHEDULE OF EFFECT OF ONE PERCENT CHANGE IN ASSUMED HEALTH CARE TREND RATES (Details) $ in Thousands | 12 Months Ended |
Dec. 31, 2017USD ($) | |
Retirement Benefits [Abstract] | |
Effect on total service and interest cost components, one percentage point increase | $ 148 |
Effect on total service and interest cost components, one percentage point decrease | (129) |
Effect on post-retirement benefit obligation, one percentage point increase | 3,133 |
Effect on post-retirement benefit obligation, one percentage point decrease | $ (2,758) |
PENSION AND OTHER POST-RETIRE93
PENSION AND OTHER POST-RETIREMENT BENEFIT PLANS - SCHEDULE OF PLAN ASSETS ACROSS ASSET CLASSES (Details) - Domestic Plans | Dec. 31, 2017 |
Cash | |
Defined Benefit Plan Disclosure [Line Items] | |
Defined Benefit Plan, Plan Assets, Target Allocation, Percentage | 1.00% |
Equity securities | |
Defined Benefit Plan Disclosure [Line Items] | |
Defined Benefit Plan, Plan Assets, Target Allocation, Percentage | 25.00% |
Fixed income securities | |
Defined Benefit Plan Disclosure [Line Items] | |
Defined Benefit Plan, Plan Assets, Target Allocation, Percentage | 49.00% |
Alternative investments, including real estate, listed infrastructure and other | |
Defined Benefit Plan Disclosure [Line Items] | |
Defined Benefit Plan, Plan Assets, Target Allocation, Percentage | 25.00% |
PENSION AND OTHER POST-RETIRE94
PENSION AND OTHER POST-RETIREMENT BENEFIT PLANS - SCHEDULE OF PENSION PLAN ASSETS WITHIN THE FAIR VALUE HIERARCHY (Details) - Pension Benefits - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 |
Defined Benefit Plan Disclosure [Line Items] | |||
Defined Benefit Plan, Fair Value of Plan Assets | $ 1,086,226 | $ 1,023,676 | $ 1,041,902 |
Fair Value, Measurements, Recurring | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Defined Benefit Plan, Fair Value of Plan Assets | 1,086,226 | 1,023,676 | |
Defined Benefit Plan, Plan Assets Measured at Net Asset Value | 993,517 | ||
Fair Value, Measurements, Recurring | Quoted prices in active markets of identical assets (Level 1) | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Defined Benefit Plan, Fair Value of Plan Assets | 1,179 | 20,792 | |
Fair Value, Measurements, Recurring | Significant other observable inputs (Level 2) | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Defined Benefit Plan, Fair Value of Plan Assets | 91,530 | 1,002,884 | |
Fair Value, Measurements, Recurring | Significant other unobservable inputs (Level 3) | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Defined Benefit Plan, Fair Value of Plan Assets | 0 | 0 | |
Fair Value, Measurements, Recurring | Cash and cash equivalents | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Defined Benefit Plan, Fair Value of Plan Assets | 20,070 | 10,116 | |
Defined Benefit Plan, Plan Assets Measured at Net Asset Value | 730 | ||
Fair Value, Measurements, Recurring | Cash and cash equivalents | Quoted prices in active markets of identical assets (Level 1) | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Defined Benefit Plan, Fair Value of Plan Assets | 1,179 | 576 | |
Fair Value, Measurements, Recurring | Cash and cash equivalents | Significant other observable inputs (Level 2) | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Defined Benefit Plan, Fair Value of Plan Assets | 18,161 | 9,540 | |
Fair Value, Measurements, Recurring | Cash and cash equivalents | Significant other unobservable inputs (Level 3) | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Defined Benefit Plan, Fair Value of Plan Assets | 0 | 0 | |
Fair Value, Measurements, Recurring | Global all-cap | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Defined Benefit Plan, Fair Value of Plan Assets | 276,825 | 262,430 | |
Defined Benefit Plan, Plan Assets Measured at Net Asset Value | 276,825 | ||
Fair Value, Measurements, Recurring | Global all-cap | Quoted prices in active markets of identical assets (Level 1) | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Defined Benefit Plan, Fair Value of Plan Assets | 0 | 20,216 | |
Fair Value, Measurements, Recurring | Global all-cap | Significant other observable inputs (Level 2) | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Defined Benefit Plan, Fair Value of Plan Assets | 0 | 242,214 | |
Fair Value, Measurements, Recurring | Global all-cap | Significant other unobservable inputs (Level 3) | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Defined Benefit Plan, Fair Value of Plan Assets | 0 | 0 | |
Fair Value, Measurements, Recurring | U.S. government/agency | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Defined Benefit Plan, Fair Value of Plan Assets | 239,686 | 228,648 | |
Defined Benefit Plan, Plan Assets Measured at Net Asset Value | 239,686 | ||
Fair Value, Measurements, Recurring | U.S. government/agency | Quoted prices in active markets of identical assets (Level 1) | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Defined Benefit Plan, Fair Value of Plan Assets | 0 | 0 | |
Fair Value, Measurements, Recurring | U.S. government/agency | Significant other observable inputs (Level 2) | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Defined Benefit Plan, Fair Value of Plan Assets | 0 | 228,648 | |
Fair Value, Measurements, Recurring | U.S. government/agency | Significant other unobservable inputs (Level 3) | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Defined Benefit Plan, Fair Value of Plan Assets | 0 | 0 | |
Fair Value, Measurements, Recurring | Corporate bonds | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Defined Benefit Plan, Fair Value of Plan Assets | 195,652 | 199,634 | |
Defined Benefit Plan, Plan Assets Measured at Net Asset Value | 162,633 | ||
Fair Value, Measurements, Recurring | Corporate bonds | Quoted prices in active markets of identical assets (Level 1) | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Defined Benefit Plan, Fair Value of Plan Assets | 0 | 0 | |
Fair Value, Measurements, Recurring | Corporate bonds | Significant other observable inputs (Level 2) | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Defined Benefit Plan, Fair Value of Plan Assets | 33,019 | 199,634 | |
Fair Value, Measurements, Recurring | Corporate bonds | Significant other unobservable inputs (Level 3) | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Defined Benefit Plan, Fair Value of Plan Assets | 0 | 0 | |
Fair Value, Measurements, Recurring | Collateralized obligations | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Defined Benefit Plan, Fair Value of Plan Assets | 74,888 | 50,532 | |
Defined Benefit Plan, Plan Assets Measured at Net Asset Value | 34,538 | ||
Fair Value, Measurements, Recurring | Collateralized obligations | Quoted prices in active markets of identical assets (Level 1) | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Defined Benefit Plan, Fair Value of Plan Assets | 0 | 0 | |
Fair Value, Measurements, Recurring | Collateralized obligations | Significant other observable inputs (Level 2) | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Defined Benefit Plan, Fair Value of Plan Assets | 40,350 | 50,532 | |
Fair Value, Measurements, Recurring | Collateralized obligations | Significant other unobservable inputs (Level 3) | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Defined Benefit Plan, Fair Value of Plan Assets | 0 | 0 | |
Fair Value, Measurements, Recurring | International government/corporate bonds | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Defined Benefit Plan, Fair Value of Plan Assets | 32,447 | 30,928 | |
Defined Benefit Plan, Plan Assets Measured at Net Asset Value | 32,447 | ||
Fair Value, Measurements, Recurring | International government/corporate bonds | Quoted prices in active markets of identical assets (Level 1) | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Defined Benefit Plan, Fair Value of Plan Assets | 0 | 0 | |
Fair Value, Measurements, Recurring | International government/corporate bonds | Significant other observable inputs (Level 2) | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Defined Benefit Plan, Fair Value of Plan Assets | 0 | 30,928 | |
Fair Value, Measurements, Recurring | International government/corporate bonds | Significant other unobservable inputs (Level 3) | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Defined Benefit Plan, Fair Value of Plan Assets | 0 | 0 | |
Fair Value, Measurements, Recurring | Global diversified assets [Member] | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Defined Benefit Plan, Fair Value of Plan Assets | 149,030 | 146,975 | |
Defined Benefit Plan, Plan Assets Measured at Net Asset Value | 149,030 | ||
Fair Value, Measurements, Recurring | Global diversified assets [Member] | Quoted prices in active markets of identical assets (Level 1) | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Defined Benefit Plan, Fair Value of Plan Assets | 0 | 0 | |
Fair Value, Measurements, Recurring | Global diversified assets [Member] | Significant other observable inputs (Level 2) | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Defined Benefit Plan, Fair Value of Plan Assets | 0 | 146,975 | |
Fair Value, Measurements, Recurring | Global diversified assets [Member] | Significant other unobservable inputs (Level 3) | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Defined Benefit Plan, Fair Value of Plan Assets | 0 | 0 | |
Fair Value, Measurements, Recurring | Global real estate investment trusts [Member] | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Defined Benefit Plan, Fair Value of Plan Assets | 50,213 | 48,000 | |
Defined Benefit Plan, Plan Assets Measured at Net Asset Value | 50,213 | ||
Fair Value, Measurements, Recurring | Global real estate investment trusts [Member] | Quoted prices in active markets of identical assets (Level 1) | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Defined Benefit Plan, Fair Value of Plan Assets | 0 | 0 | |
Fair Value, Measurements, Recurring | Global real estate investment trusts [Member] | Significant other observable inputs (Level 2) | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Defined Benefit Plan, Fair Value of Plan Assets | 0 | 48,000 | |
Fair Value, Measurements, Recurring | Global real estate investment trusts [Member] | Significant other unobservable inputs (Level 3) | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Defined Benefit Plan, Fair Value of Plan Assets | 0 | 0 | |
Fair Value, Measurements, Recurring | Global infrastructure [Member] | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Defined Benefit Plan, Fair Value of Plan Assets | 47,415 | 46,413 | |
Defined Benefit Plan, Plan Assets Measured at Net Asset Value | 47,415 | ||
Fair Value, Measurements, Recurring | Global infrastructure [Member] | Quoted prices in active markets of identical assets (Level 1) | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Defined Benefit Plan, Fair Value of Plan Assets | 0 | 0 | |
Fair Value, Measurements, Recurring | Global infrastructure [Member] | Significant other observable inputs (Level 2) | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Defined Benefit Plan, Fair Value of Plan Assets | 0 | 46,413 | |
Fair Value, Measurements, Recurring | Global infrastructure [Member] | Significant other unobservable inputs (Level 3) | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Defined Benefit Plan, Fair Value of Plan Assets | $ 0 | $ 0 |
PENSION AND OTHER POST-RETIRE95
PENSION AND OTHER POST-RETIREMENT BENEFIT PLANS - SCHEDULE OF EXPECTED BENEFIT PAYMENTS TO BE PAID (Details) $ in Thousands | Dec. 31, 2017USD ($) |
Pension Benefits | |
Defined Benefit Plan Disclosure [Line Items] | |
2,018 | $ 126,392 |
2,019 | 78,614 |
2,020 | 85,804 |
2,021 | 87,159 |
2,022 | 107,005 |
2023-2027 | 407,769 |
Other Benefits | |
Defined Benefit Plan Disclosure [Line Items] | |
2,018 | 20,773 |
2,019 | 19,026 |
2,020 | 17,768 |
2,021 | 16,863 |
2,022 | 15,767 |
2023-2027 | $ 69,003 |
STOCK COMPENSATION PLANS - STOC
STOCK COMPENSATION PLANS - STOCK COMPENSATION PLANS NARRATIVE (Details) - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Share-based compensation arrangement by share-based payment award, number of shares authorized (shares) | 65,800,000 | ||
Employee service share-based compensation, nonvested awards, compensation cost not yet recognized | $ 62,274 | ||
Employee service share-based compensation, nonvested awards, compensation cost not yet recognized, period for recognition | 2 years 1 month | ||
Intrinsic value of share-based liabilities paid, combined with the fair value of shares vested (in millions of dollars) | $ 29,981 | $ 22,062 | $ 46,113 |
Deferred performance stock units, deferred restricted stock units, and directors' fees and accumulated dividend amounts representing deferred stock units outstanding | 369,278 | ||
Employee stock options | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Employee service share-based compensation, nonvested awards, compensation cost not yet recognized, period for recognition | 2 years 5 months | ||
Share-based compensation arrangement by share-based payment award, expiration period | 10 years | ||
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Period | 4 years | ||
Weighted-average fair value of options granted (per share) | $ 15.76 | $ 11.46 | $ 18.99 |
Intrinsic value of options exercised (in millions of dollars) | $ 45,998 | $ 73,944 | $ 66,161 |
Employee service share-based compensation, nonvested awards, compensation not yet recognized, stock options | $ 15,849 | ||
Performance Shares [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Employee service share-based compensation, nonvested awards, compensation cost not yet recognized, period for recognition | 3 years | ||
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Period | 3 years | ||
Performance Shares [Member] | Minimum | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Share based compensation arrangement, by share based payment award, equity instruments other than options, performance score, percentage | 0.00% | ||
Performance Shares [Member] | Maximum | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Share based compensation arrangement, by share based payment award, equity instruments other than options, performance score, percentage | 250.00% | ||
Performance Stock Units and Restricted Stock Units [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Common stock, conversion basis (shares) | 1 |
STOCK COMPENSATION PLANS - SCHE
STOCK COMPENSATION PLANS - SCHEDULE OF COMPENSATION EXPENSE AND INCOME TAX BENEFITS FOR STOCK-BASED COMPENSATION PROGRAMS (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |||
Pre-tax compensation expense | $ 51,061 | $ 54,785 | $ 51,533 |
Related income tax benefit | $ 13,684 | $ 17,148 | $ 17,109 |
STOCK COMPENSATION PLANS - SC98
STOCK COMPENSATION PLANS - SCHEDULE OF STOCK OPTION ACTIVITY (Details) - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2016 | |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding [Roll Forward] | ||
Outstanding shares at beginning of year (shares) | 6,192,008 | |
Granted (shares) | 1,094,155 | |
Exercised (shares) | (1,133,511) | |
Forfeited (shares) | (231,590) | |
Outstanding as of December 31, 2017 (shares) | 5,921,062 | 6,192,008 |
Options exercisable as of December 31, 2017 (shares) | 3,699,469 | |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Weighted Average Exercise Price [Abstract] | ||
Outstanding (USD per share) | $ 82.67 | |
Granted (USD per share) | 108.06 | |
Exercises (USD per share) | 69.64 | |
Forfeited (USD per share) | 103.03 | |
Outstanding (USD per share) | 89.06 | $ 82.67 |
Options exercisable (USD per share) | $ 81.65 | |
Options outstanding, weighted-average remaining contractual term | 5 years 10 months | 6 years 2 months |
Options exercisable, weighted aver remaining contractual term | 4 years 4 months | |
Aggregate intrinsic value of options outstanding | $ 141,893 | |
Aggregate intrinsic value of options exercisable | $ 116,067 |
STOCK COMPENSATION PLANS - SC99
STOCK COMPENSATION PLANS - SCHEDULE OF FAIR VALUE WEIGHTED-AVERAGE ASSUMPTIONS (Details) | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |||
Dividend yields | 2.40% | 2.40% | 2.10% |
Expected volatility | 17.20% | 16.80% | 20.70% |
Risk-free interest rates | 2.20% | 1.50% | 1.90% |
Expected term in years | 6 years 9 months | 6 years 9 months | 6 years 8 months |
STOCK COMPENSATION PLANS - S100
STOCK COMPENSATION PLANS - SCHEDULE OF STOCK OPTION INFORMATION BY EXERCISE PRICE RANGE (Details) | 12 Months Ended |
Dec. 31, 2017$ / sharesshares | |
$33.40 - $81.73 | |
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | |
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range, Lower Range Limit | $ 33.40 |
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range, Upper Range Limit | $ 81.73 |
Number Outstanding as of 12/31/17 (shares) | shares | 1,985,084 |
Weighted- Average Remaining Contractual Life in Years | 3 years 5 months |
Weighted- Average Exercise Price (USD per share) | $ 63.53 |
Number Exercisable as of 12/31/17 (shares) | shares | 1,985,084 |
Weighted- Average Exercise Price (USD per share) | $ 63.53 |
$81.74 - $105.91 | |
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | |
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range, Lower Range Limit | 81.74 |
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range, Upper Range Limit | $ 105.91 |
Number Outstanding as of 12/31/17 (shares) | shares | 2,060,833 |
Weighted- Average Remaining Contractual Life in Years | 6 years 11 months |
Weighted- Average Exercise Price (USD per share) | $ 97.25 |
Number Exercisable as of 12/31/17 (shares) | shares | 929,199 |
Weighted- Average Exercise Price (USD per share) | $ 99.72 |
$105.92 - $111.76 | |
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | |
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range, Lower Range Limit | 105.92 |
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range, Upper Range Limit | $ 111.76 |
Number Outstanding as of 12/31/17 (shares) | shares | 1,875,145 |
Weighted- Average Remaining Contractual Life in Years | 7 years 1 month |
Weighted- Average Exercise Price (USD per share) | $ 107.06 |
Number Exercisable as of 12/31/17 (shares) | shares | 785,186 |
Weighted- Average Exercise Price (USD per share) | $ 106.04 |
$33.40 - $111.76 | |
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | |
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range, Lower Range Limit | 33.40 |
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range, Upper Range Limit | $ 111.76 |
Number Outstanding as of 12/31/17 (shares) | shares | 5,921,062 |
Weighted- Average Remaining Contractual Life in Years | 5 years 10 months |
Weighted- Average Exercise Price (USD per share) | $ 89.06 |
Number Exercisable as of 12/31/17 (shares) | shares | 3,699,469 |
Weighted- Average Exercise Price (USD per share) | $ 81.65 |
STOCK COMPENSATION PLANS - S101
STOCK COMPENSATION PLANS - SCHEDULE OF PSUs AND RSUs ACTIVITY (Details) - Performance and restricted stock units - $ / shares | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Share-based Compensation Arrangement by Share-based Payment Award, Non-Option Equity Instruments, Outstanding [Roll Forward] | |||
Outstanding at beginning of year (shares) | 828,228 | ||
Granted (shares) | 478,044 | 545,750 | 381,407 |
Performance assumption change (shares) | 21,305 | ||
Vested (shares) | (277,261) | ||
Forfeited (shares) | (126,952) | ||
Outstanding at end of year (shares) | 923,364 | 828,228 | |
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Weighted Average Grant Date Fair Value [Abstract] | |||
Outstanding at beginning of year (USD per share) | $ 102.66 | ||
Weighted-average fair value at date of grant (USD per share) | 110.97 | $ 93.55 | $ 104.68 |
Performance assumption change | 96.71 | ||
Vested (USD per share) | 109.35 | ||
Forfeited (USD per share) | 107.91 | ||
Outstanding at end of year (USD per share) | $ 103.11 | $ 102.66 |
STOCK COMPENSATION PLANS - S102
STOCK COMPENSATION PLANS - SCHEDULE OF PSUs AND RSUS FAIR VALUE WEIGHTED-AVERAGE ASSUMPTIONS (Details) - $ / shares | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Dividend yields | 2.40% | 2.40% | 2.10% |
Performance and restricted stock units | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Units granted (shares) | 478,044 | 545,750 | 381,407 |
Weighted-average fair value at date of grant (USD per share) | $ 110.97 | $ 93.55 | $ 104.68 |
Estimated values (USD per share) | $ 46.85 | $ 38.02 | $ 61.22 |
Dividend yields | 2.30% | 2.50% | 2.00% |
Expected volatility | 20.40% | 17.00% | 14.90% |
- SEGMENT INFORMATION NARRATIVE
- SEGMENT INFORMATION NARRATIVE (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
North America | Geographic Concentration Risk | Sales Revenue, Goods, Net | |||
Revenue, Major Customer [Line Items] | |||
Concentration Risk, Percentage | 88.00% | ||
Operating Segments | Commodities futures and options | |||
Revenue, Major Customer [Line Items] | |||
Net Gain Loss On Commodity Derivative Positions Reclassified From Unallocated Derivative Gains Losses To Segment Income | $ (91,026) | $ (8,515) | |
Scenario, Forecast | Operating Segments | Commodities futures and options | |||
Revenue, Major Customer [Line Items] | |||
Net Gain Loss On Commodity Derivative Positions Reclassified From Unallocated Derivative Gains Losses To Segment Income | $ (94,449) | ||
Cost of Sales | Commodities futures and options | |||
Revenue, Major Customer [Line Items] | |||
Derivative, Gain (Loss) on Derivative, Net | $ (127,946) |
- SCHEDULE OF NET SALES AND EAR
- SCHEDULE OF NET SALES AND EARNINGS BY SEGMENT (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2017 | Oct. 01, 2017 | Jul. 02, 2017 | Apr. 02, 2017 | Dec. 31, 2016 | Oct. 02, 2016 | Jul. 03, 2016 | Apr. 03, 2016 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Segment Reporting Information [Line Items] | |||||||||||
Net Sales | $ 1,939,636 | $ 2,033,121 | $ 1,662,991 | $ 1,879,678 | $ 1,970,244 | $ 2,003,454 | $ 1,637,671 | $ 1,828,812 | $ 7,515,426 | $ 7,440,181 | $ 7,386,626 |
Operating Income (Loss) | 1,274,641 | 1,205,783 | 1,037,759 | ||||||||
Costs associated with business realignment activities | 69,359 | 107,571 | 120,975 | ||||||||
Interest expense, net | 98,282 | 90,143 | 105,773 | ||||||||
Other (income) expense, net | 65,691 | 16,159 | 30,139 | ||||||||
Income before income taxes | 1,110,668 | 1,099,481 | 901,847 | ||||||||
Operating Segments | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Operating Income (Loss) | 2,057,082 | 2,011,856 | 1,975,900 | ||||||||
Operating Segments | North America | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Net Sales | 6,621,173 | 6,532,988 | 6,468,158 | ||||||||
Operating Income (Loss) | 2,045,550 | 2,040,995 | 2,073,967 | ||||||||
Operating Segments | International and Other | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Net Sales | 894,253 | 907,193 | 918,468 | ||||||||
Operating Income (Loss) | 11,532 | (29,139) | (98,067) | ||||||||
Corporate, Non-Segment | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Operating Income (Loss) | 504,323 | 497,423 | 497,386 | ||||||||
Segment Reconciling Items | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Derivative, Gain (Loss) on Derivative, Net | (35,292) | 163,238 | 0 | ||||||||
Goodwill and long-lived asset impairment charges | 208,712 | 4,204 | 280,802 | ||||||||
Costs associated with business realignment activities | 69,359 | 107,571 | 120,975 | ||||||||
Non-service related pension expense | 35,028 | 27,157 | 18,079 | ||||||||
Acquisition and integration costs | $ 311 | $ 6,480 | $ 20,899 |
SEGMENT INFORMATION - SCHEDULE
SEGMENT INFORMATION - SCHEDULE OF UNALLOCATED MARK-TO-MARKET (GAINS) LOSSES ON COMMODITY DERIVATIVES (Details) - Commodities futures and options - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2016 | |
Segment Reconciling Items | ||
Segment Reporting Information [Line Items] | ||
Net Mark to Market Valuation of Certain Derivative Positions Recognized in Unallocated Derivative Gains Losses | $ 35,292 | $ (163,238) |
Operating Segments | ||
Segment Reporting Information [Line Items] | ||
Net Gain Loss On Commodity Derivative Positions Reclassified From Unallocated Derivative Gains Losses To Segment Income | (91,026) | (8,515) |
Non-designated Hedges | ||
Segment Reporting Information [Line Items] | ||
Derivative, Gain (Loss) on Derivative, Net | $ 55,734 | $ 171,753 |
- SCHEDULE OF DEPRECIATION AND
- SCHEDULE OF DEPRECIATION AND AMORTIZATION EXPENSE INCLUDED WITHIN SEGMENT INCOME (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Segment Reporting Information [Line Items] | |||
Depreciation and amortization | $ 261,853 | $ 301,837 | $ 244,928 |
Operating Segments | North America | |||
Segment Reporting Information [Line Items] | |||
Depreciation and amortization | 171,265 | 162,211 | 153,185 |
Operating Segments | International and Other | |||
Segment Reporting Information [Line Items] | |||
Depreciation and amortization | 42,542 | 50,753 | 46,342 |
Corporate, Non-Segment | Corporate (1) | |||
Segment Reporting Information [Line Items] | |||
Depreciation and amortization | $ 48,046 | $ 88,873 | $ 45,401 |
- SCHEDULE OF SEGMENT INFORMATI
- SCHEDULE OF SEGMENT INFORMATION BY GEOGRAPHY (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2017 | Oct. 01, 2017 | Jul. 02, 2017 | Apr. 02, 2017 | Dec. 31, 2016 | Oct. 02, 2016 | Jul. 03, 2016 | Apr. 03, 2016 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Revenues from External Customers and Long-Lived Assets [Line Items] | |||||||||||
Net sales | $ 1,939,636 | $ 2,033,121 | $ 1,662,991 | $ 1,879,678 | $ 1,970,244 | $ 2,003,454 | $ 1,637,671 | $ 1,828,812 | $ 7,515,426 | $ 7,440,181 | $ 7,386,626 |
Long-lived assets | 2,106,697 | 2,177,248 | 2,106,697 | 2,177,248 | 2,240,460 | ||||||
United States | |||||||||||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||||||||||
Net sales | 6,263,703 | 6,196,723 | 6,116,490 | ||||||||
Long-lived assets | 1,575,496 | 1,528,255 | 1,575,496 | 1,528,255 | 1,528,723 | ||||||
Other | |||||||||||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||||||||||
Net sales | 1,251,723 | 1,243,458 | 1,270,136 | ||||||||
Long-lived assets | $ 531,201 | $ 648,993 | $ 531,201 | $ 648,993 | $ 711,737 |
EQUITY AND NONCONTROLLING IN108
EQUITY AND NONCONTROLLING INTEREST - EQUITY AND NONCONTROLLING INTEREST NARRATIVE (Details) | 1 Months Ended | 12 Months Ended | ||
Aug. 31, 2017USD ($)$ / sharesshares | Dec. 31, 2017USD ($)vote$ / sharesshares | Dec. 31, 2016USD ($)shares | Dec. 31, 2015USD ($)shares | |
Class of Stock [Line Items] | ||||
Net income (loss) attributable to noncontrolling interests | $ | $ (26,444,000) | $ 0 | $ 0 | |
Common and preferred shares authorized (shares) | 1,055,000,000 | |||
Preferred stock, shares authorized (shares) | 5,000,000 | |||
Preferred stock, par value (USD per share) | $ / shares | $ 1 | |||
Common stock, shares, outstanding (shares) | 210,860,817 | 212,259,735 | 216,777,360 | |
Noncontrolling Interests in Subsidiaries | ||||
Class of Stock [Line Items] | ||||
Net income (loss) attributable to noncontrolling interests | $ | $ (26,444,000) | |||
Noncontrolling Interests in Subsidiaries | Lotte Shanghai Food Company | ||||
Class of Stock [Line Items] | ||||
Noncontrolling interest, ownership percentage by parent | 50.00% | |||
Common stock | ||||
Class of Stock [Line Items] | ||||
Common stock, shares authorized (shares) | 900,000,000 | |||
Common stock, par (USD per share) | $ / shares | $ 1 | |||
Common stock voting rights, board election percentage | 16.66% | |||
Common stock, voting rights (vote) | vote | 1 | |||
Dividends, common sock, cash, additional percentage over Class B common stock dividends | 10.00% | |||
Treasury Stock, Shares, Acquired | 0 | 4,640,964 | 4,209,112 | |
Common stock | Hershey Trust Company | ||||
Class of Stock [Line Items] | ||||
Common stock, shares, outstanding (shares) | 8,403,121 | |||
Class B common stock | ||||
Class of Stock [Line Items] | ||||
Common stock, shares authorized (shares) | 150,000,000 | |||
Common stock, voting rights (vote) | vote | 10 | |||
Conversion of Stock, Shares Converted | 0 | 0 | ||
Class B common stock | Hershey Trust Company | ||||
Class of Stock [Line Items] | ||||
Common stock, shares, outstanding (shares) | 60,612,012 | |||
Common stock, voting percentage | 80.00% | |||
Hershey Trust Company | ||||
Class of Stock [Line Items] | ||||
Treasury Stock, Shares, Acquired | 1,500,000 | |||
Treasury Stock Acquired, Average Cost Per Share | $ / shares | $ 106.01 | |||
Stock Repurchased During Period, Value | $ | $ 159,015,000 | |||
Selling, marketing and administrative | ||||
Class of Stock [Line Items] | ||||
Net income (loss) attributable to noncontrolling interests | $ | $ (3,970,000) | $ 577,000 | ||
Selling, marketing and administrative | Noncontrolling Interests in Subsidiaries | ||||
Class of Stock [Line Items] | ||||
Net income (loss) attributable to noncontrolling interests | $ | $ (3,970,000) | $ 577,000 |
EQUITY AND NONCONTROLLING IN109
EQUITY AND NONCONTROLLING INTEREST - SCHEDULE OF THE CHANGES IN THE OUTSTANDING SHARES OF COMMMON STOCK (Details) - shares | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Class of Stock [Line Items] | |||
Common stock, shares issued (shares) | 359,901,744 | 359,901,744 | 359,901,744 |
Treasury stock, shares, beginning of the period (shares) | (147,642,009) | (143,124,384) | (138,856,786) |
Stock issuances: | |||
Treasury stock, shares, end of the period (shares) | (149,040,927) | (147,642,009) | (143,124,384) |
Common stock, shares, outstanding (shares) | 210,860,817 | 212,259,735 | 216,777,360 |
Employee stock options | |||
Stock repurchases: | |||
Treasury Stock, Shares, Acquired | 1,278,675 | 1,820,766 | 1,776,838 |
Stock issuances: | |||
Stock issued during period, shares, share-based compensation (gross) | 1,379,757 | 1,944,105 | 1,718,352 |
Common stock | |||
Class of Stock [Line Items] | |||
Common stock, shares issued (shares) | 299,281,967 | 299,281,967 | |
Stock repurchases: | |||
Treasury Stock, Shares, Acquired | 0 | 4,640,964 | 4,209,112 |
Hershey Trust Company | |||
Stock repurchases: | |||
Treasury Stock, Shares, Acquired | 1,500,000 | 0 | 0 |
EQUITY AND NONCONTROLLING IN110
EQUITY AND NONCONTROLLING INTEREST - SCHEDULE OF ACTIVITY RELATING TO THE NONCONTROLLING INTEREST (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Stockholders' Equity Attributable to Noncontrolling Interest [Roll Forward] | |||
Balance, December 31, 2016 | $ 41,831 | ||
Net income (loss) attributable to noncontrolling interests | (26,444) | $ 0 | $ 0 |
Balance, December 31, 2017 | 16,227 | 41,831 | |
Noncontrolling Interests in Subsidiaries | |||
Stockholders' Equity Attributable to Noncontrolling Interest [Roll Forward] | |||
Balance, December 31, 2016 | 41,831 | ||
Net income (loss) attributable to noncontrolling interests | (26,444) | ||
Other comprehensive income - foreign currency translation adjustments | 840 | ||
Balance, December 31, 2017 | $ 16,227 | $ 41,831 |
COMMITMENTS AND CONTINGENCIES -
COMMITMENTS AND CONTINGENCIES - SCHEDULE OF PURCHASE OBLIGATIONS COVERED BY PUTCHASE AGREEMENTS WITH VARIOUS SUPPLIERS FUTURE MATURTY SCHEDULE (Details) - Inventories $ in Millions | Dec. 31, 2017USD ($) |
Unrecorded Unconditional Purchase Obligation, Fiscal Year Maturity [Abstract] | |
2,018 | $ 1,359.7 |
2,019 | 272.3 |
2,020 | 11.4 |
2,021 | 2.5 |
2,022 | $ 0.7 |
COMMITMENTS AND CONTINGENCIE112
COMMITMENTS AND CONTINGENCIES - SCHEDULE OF OPERATING AND CAPITAL LEASE OBLIGATIONS (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Commitments and Contingencies Disclosure [Abstract] | |||
Operating Leases, Future Minimum Payments Due, Next Twelve Months | $ 16,241 | ||
Operating Leases, Future Minimum Payments, Due in Two Years | 16,784 | ||
Operating Leases, Future Minimum Payments, Due in Three Years | 14,763 | ||
Operating Leases, Future Minimum Payments, Due in Four Years | 12,914 | ||
Operating Leases, Future Minimum Payments, Due in Five Years | 11,267 | ||
Operating Leases, Future Minimum Payments, Due Thereafter | 182,368 | ||
Capital Leases, Future Minimum Payments Due, Next Twelve Months | 3,401 | ||
Capital Leases, Future Minimum Payments Due in Two Years | 3,469 | ||
Capital Leases, Future Minimum Payments Due in Three Years | 3,538 | ||
Capital Leases, Future Minimum Payments Due in Four Years | 3,609 | ||
Capital Leases, Future Minimum Payments Due in Five Years | 4,216 | ||
Capital Leases, Future Minimum Payments Due Thereafter | 175,313 | ||
Operating Leases, Rent Expense | $ 25,525 | $ 20,330 | $ 19,754 |
COMMITMENTS AND CONTINGENCIE113
COMMITMENTS AND CONTINGENCIES - COMMITMENTS AND CONTINGENCIES NARRATIVE (Details) - employee | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Concentration Risk [Line Items] | ||
Entity number of employees | 15,360 | |
Entity number of part-time employees | 1,550 | |
Workforce Subject to Collective Bargaining Arrangements | ||
Concentration Risk [Line Items] | ||
Entity number of employees | 5,450 | |
Percentage of employees | 32.00% | |
Workforce Subject to Collective Bargaining Arrangements | Scenario, Forecast | ||
Concentration Risk [Line Items] | ||
Percentage of employees | 72.00% |
- SCHEDULE OF BASIC AND DILUTED
- SCHEDULE OF BASIC AND DILUTED EARNINGS PER SHARE (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2017 | Oct. 01, 2017 | Jul. 02, 2017 | Apr. 02, 2017 | Dec. 31, 2016 | Oct. 02, 2016 | Jul. 03, 2016 | Apr. 03, 2016 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Common stock | |||||||||||
Basic earnings per share: | |||||||||||
Allocation of distributed earnings (cash dividends paid) | $ 385,878 | $ 367,081 | $ 352,953 | ||||||||
Allocation of undistributed earnings | 188,286 | 162,299 | 27,324 | ||||||||
Total earnings—basic | $ 574,164 | $ 529,380 | $ 380,277 | ||||||||
Total weighted-average shares—basic (shares) | 151,625 | 153,519 | 158,471 | ||||||||
Earnings Per Share—basic (USD per share) | $ 0.88 | $ 1.32 | $ 0.98 | $ 0.60 | $ 0.56 | $ 1.09 | $ 0.70 | $ 1.09 | $ 3.79 | $ 3.45 | $ 2.40 |
Diluted earnings per share: | |||||||||||
Allocation of total earnings used in basic computation | $ 574,164 | $ 529,380 | $ 380,277 | ||||||||
Reallocation of total earnings as a result of conversion of Class B common stock to Common stock | 208,817 | 190,664 | 132,674 | ||||||||
Reallocation of undistributed earnings | 0 | 0 | 0 | ||||||||
Total earnings—diluted | $ 782,981 | $ 720,044 | $ 512,951 | ||||||||
Conversion of Class B common stock to Common shares outstanding | 60,620 | 60,620 | 60,620 | ||||||||
Total weighted-average shares—diluted (shares) | 213,742 | 215,304 | 220,651 | ||||||||
Earnings Per Share—diluted (USD per share) | 0.85 | 1.28 | 0.95 | 0.58 | 0.55 | 1.06 | 0.68 | 1.06 | $ 3.66 | $ 3.34 | $ 2.32 |
Common stock | Employee stock options | |||||||||||
Diluted earnings per share: | |||||||||||
Incremental common shares attributable to dilutive effect of share-based payment arrangements | 1,144 | 964 | 1,335 | ||||||||
Common stock | Performance and restricted stock units | |||||||||||
Diluted earnings per share: | |||||||||||
Incremental common shares attributable to dilutive effect of share-based payment arrangements | 353 | 201 | 225 | ||||||||
Class B common stock | |||||||||||
Basic earnings per share: | |||||||||||
Allocation of distributed earnings (cash dividends paid) | $ 140,394 | $ 132,394 | $ 123,179 | ||||||||
Allocation of undistributed earnings | 68,423 | 58,270 | 9,495 | ||||||||
Total earnings—basic | $ 208,817 | $ 190,664 | $ 132,674 | ||||||||
Total weighted-average shares—basic (shares) | 60,620 | 60,620 | 60,620 | ||||||||
Earnings Per Share—basic (USD per share) | 0.80 | 1.20 | 0.89 | 0.55 | 0.51 | 0.99 | 0.64 | 0.99 | $ 3.44 | $ 3.15 | $ 2.19 |
Diluted earnings per share: | |||||||||||
Allocation of total earnings used in basic computation | $ 208,817 | $ 190,664 | $ 132,674 | ||||||||
Reallocation of total earnings as a result of conversion of Class B common stock to Common stock | 0 | 0 | 0 | ||||||||
Reallocation of undistributed earnings | (492) | (324) | (69) | ||||||||
Total earnings—diluted | $ 208,325 | $ 190,340 | $ 132,605 | ||||||||
Conversion of Class B common stock to Common shares outstanding | 0 | 0 | 0 | ||||||||
Total weighted-average shares—diluted (shares) | 60,620 | 60,620 | 60,620 | ||||||||
Earnings Per Share—diluted (USD per share) | $ 0.80 | $ 1.20 | $ 0.89 | $ 0.55 | $ 0.51 | $ 0.99 | $ 0.64 | $ 0.99 | $ 3.44 | $ 3.14 | $ 2.19 |
Class B common stock | Employee stock options | |||||||||||
Diluted earnings per share: | |||||||||||
Incremental common shares attributable to dilutive effect of share-based payment arrangements | 0 | 0 | 0 | ||||||||
Class B common stock | Performance and restricted stock units | |||||||||||
Diluted earnings per share: | |||||||||||
Incremental common shares attributable to dilutive effect of share-based payment arrangements | 0 | 0 | 0 |
EARNINGS PER SHARE - EARNINGS P
EARNINGS PER SHARE - EARNINGS PER SHARE NARRATIVE (Details) - shares shares in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Employee stock options | |||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||
Antidilutive securities excluded from computation of earnings per share (shares) | 2,374 | 3,680 | 2,660 |
OTHER (INCOME) EXPENSE, NET - S
OTHER (INCOME) EXPENSE, NET - SCHEDULE OF OTHER (INCOME) AND EXPENSE, NET (Details) - USD ($) $ in Thousands | Feb. 03, 2016 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 |
Summary of Investments, Other than Investments in Related Parties, Reportable Data [Line Items] | ||||
Write-down of equity investments in partnerships qualifying for tax credits | $ 66,209 | $ 43,482 | $ 39,489 | |
Gain on settlement of SGM liability (see Note 2) | 0 | 26,650 | 0 | |
Other (income) expense, net | (518) | (673) | 600 | |
Total | 65,691 | 16,159 | 30,139 | |
Shanghai Golden Monkey Food Joint Stock Co., Ltd. | ||||
Summary of Investments, Other than Investments in Related Parties, Reportable Data [Line Items] | ||||
Gain on settlement of SGM liability (see Note 2) | $ 26,650 | 0 | 26,650 | 0 |
Trademarks | ||||
Summary of Investments, Other than Investments in Related Parties, Reportable Data [Line Items] | ||||
Gain on sale of non-core trademark | $ 0 | $ 0 | $ (9,950) |
- SCHEDULE OF SUPPLEMENTAL BALA
- SCHEDULE OF SUPPLEMENTAL BALANCE SHEET INFORMATION (Details) - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 |
Inventory, Net [Abstract] | |||
Raw materials | $ 224,940 | $ 315,239 | |
Goods in process | 93,627 | 88,490 | |
Finished goods | 614,945 | 528,587 | |
Inventories at FIFO | 933,512 | 932,316 | |
Adjustment to LIFO | (180,676) | (186,638) | |
Total inventories | 752,836 | 745,678 | |
Property, Plant and Equipment [Abstract] | |||
Land | 108,300 | 103,865 | |
Buildings | 1,214,158 | 1,238,634 | |
Machinery and equipment | 2,925,353 | 3,001,552 | |
Construction in progress | 212,912 | 230,987 | |
Property, plant and equipment, gross | 4,460,723 | 4,575,038 | |
Accumulated depreciation | (2,354,026) | (2,397,790) | |
Property, plant and equipment, net | 2,106,697 | 2,177,248 | $ 2,240,460 |
Other Assets, Noncurrent [Abstract] | |||
Capitalized software, net | 104,881 | 95,301 | |
Income tax receivable | 0 | 1,449 | |
Other non-current assets | 146,998 | 71,615 | |
Total other assets | 251,879 | 168,365 | |
Accrued Liabilities, Current [Abstract] | |||
Payroll, compensation and benefits | 190,863 | 240,080 | |
Advertising and promotion | 305,107 | 358,573 | |
Other | 180,164 | 152,333 | |
Total accrued liabilities | 676,134 | 750,986 | |
Other Liabilities, Noncurrent [Abstract] | |||
Post-retirement benefits liabilities | 215,320 | 220,270 | |
Pension benefits liabilities | 39,410 | 65,687 | |
Other | 184,209 | 114,204 | |
Total other long-term liabilities | 438,939 | 400,161 | |
Accumulated Other Comprehensive Income (Loss), Net of Tax [Abstract] | |||
Foreign currency translation adjustments | (91,837) | (110,613) | |
Pension and post-retirement benefit plans, net of tax | (169,526) | (207,169) | |
Cash flow hedges, net of tax | (52,383) | (58,106) | |
Total accumulated other comprehensive loss | $ (313,746) | $ (375,888) |
- SCHEDULE OF QUARTERLY FINANCI
- SCHEDULE OF QUARTERLY FINANCIAL INFORMATION (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2017 | Oct. 01, 2017 | Jul. 02, 2017 | Apr. 02, 2017 | Dec. 31, 2016 | Oct. 02, 2016 | Jul. 03, 2016 | Apr. 03, 2016 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Net sales | $ 1,939,636 | $ 2,033,121 | $ 1,662,991 | $ 1,879,678 | $ 1,970,244 | $ 2,003,454 | $ 1,637,671 | $ 1,828,812 | $ 7,515,426 | $ 7,440,181 | $ 7,386,626 |
Gross profit | 834,527 | 940,222 | 763,210 | 906,560 | 742,269 | 850,848 | 747,398 | 817,376 | 3,444,519 | 3,157,891 | 3,382,675 |
Net income attributable to The Hershey Company | $ 181,133 | $ 273,303 | $ 203,501 | $ 125,044 | $ 116,853 | $ 227,403 | $ 145,956 | $ 229,832 | $ 782,981 | $ 720,044 | $ 512,951 |
Maximum | |||||||||||
Market price of common stock throughout the quarter (USD per share) | $ 115.45 | $ 110.5 | $ 115.96 | $ 109.61 | $ 104.44 | $ 113.89 | $ 113.49 | $ 93.71 | $ 115.45 | $ 104.44 | |
Minimum | |||||||||||
Market price of common stock throughout the quarter (USD per share) | 102.87 | 104.06 | 106.41 | 103.45 | 94.63 | 94.64 | 89.60 | 83.32 | 102.87 | 94.63 | |
Common stock | |||||||||||
Net income per share - basic (USD per share) | 0.88 | 1.32 | 0.98 | 0.60 | 0.56 | 1.09 | 0.70 | 1.09 | 3.79 | 3.45 | $ 2.40 |
Net income per share - diluted (USD per share) | 0.85 | 1.28 | 0.95 | 0.58 | 0.55 | 1.06 | 0.68 | 1.06 | 3.66 | 3.34 | 2.32 |
Dividends paid per share (USD per share) | 0.656 | 0.656 | 0.618 | 0.618 | 0.618 | 0.618 | 0.583 | 0.583 | 2.548 | 2.402 | 2.236 |
Class B common stock | |||||||||||
Net income per share - basic (USD per share) | 0.80 | 1.20 | 0.89 | 0.55 | 0.51 | 0.99 | 0.64 | 0.99 | 3.44 | 3.15 | 2.19 |
Net income per share - diluted (USD per share) | 0.80 | 1.20 | 0.89 | 0.55 | 0.51 | 0.99 | 0.64 | 0.99 | 3.44 | 3.14 | 2.19 |
Dividends paid per share (USD per share) | $ 0.596 | $ 0.596 | $ 0.562 | $ 0.562 | $ 0.562 | $ 0.562 | $ 0.530 | $ 0.530 | $ 2.316 | $ 2.184 | $ 2.032 |
SUBSEQUENT EVENTS SUBSEQUENT119
SUBSEQUENT EVENTS SUBSEQUENT EVENTS (Details) - USD ($) | Jan. 31, 2018 | Dec. 31, 2017 | Oct. 01, 2017 | Jul. 02, 2017 | Apr. 02, 2017 | Dec. 31, 2016 | Oct. 02, 2016 | Jul. 03, 2016 | Apr. 03, 2016 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | Jan. 08, 2018 |
Subsequent Event [Line Items] | ||||||||||||||
Net sales | $ 1,939,636,000 | $ 2,033,121,000 | $ 1,662,991,000 | $ 1,879,678,000 | $ 1,970,244,000 | $ 2,003,454,000 | $ 1,637,671,000 | $ 1,828,812,000 | $ 7,515,426,000 | $ 7,440,181,000 | $ 7,386,626,000 | |||
Amplify Snack Brands, Inc. [Member] | Minimum | Scenario, Forecast | ||||||||||||||
Subsequent Event [Line Items] | ||||||||||||||
Net sales | $ 375,000 | |||||||||||||
Amplify Snack Brands, Inc. [Member] | Maximum | Scenario, Forecast | ||||||||||||||
Subsequent Event [Line Items] | ||||||||||||||
Net sales | $ 385,000 | |||||||||||||
Subsequent Event | ||||||||||||||
Subsequent Event [Line Items] | ||||||||||||||
Business Combination, Consideration Transferred | $ 908,000 | |||||||||||||
Business Combination, Consideration Transferred Pr Share of Common Stock | $ 12 | |||||||||||||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Noncurrent Liabilities, Long-term Debt | $ 607,000 | |||||||||||||
Subsequent Event | Revolving Credit Facility | Line of Credit | ||||||||||||||
Subsequent Event [Line Items] | ||||||||||||||
Line of Credit Facility, Maximum Borrowing Capacity | $ 1,500,000,000 |
SCHEDULE II - VALUATION AND 120
SCHEDULE II - VALUATION AND QUALIFYING ACCOUNTS (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Movement in Valuation Allowances and Reserves [Roll Forward] | |||
Balance at Beginning of Period | $ 295,681 | $ 262,325 | $ 174,856 |
Charged to Costs and Expenses | 294,798 | 232,797 | 264,888 |
Charged to Other Accounts | 0 | 0 | 0 |
Deductions from Reserves | (217,191) | (199,441) | (177,419) |
Balance at End of Period | 373,288 | 295,681 | 262,325 |
Allowance for Trade Receivables | |||
Movement in Valuation Allowances and Reserves [Roll Forward] | |||
Balance at Beginning of Period | 40,153 | 32,638 | 15,885 |
Charged to Costs and Expenses | 166,993 | 174,314 | 172,622 |
Charged to Other Accounts | 0 | 0 | 0 |
Deductions from Reserves | (165,354) | (166,799) | (155,869) |
Balance at End of Period | 41,792 | 40,153 | 32,638 |
Valuation Allowance of Net Deferred Taxes | |||
Movement in Valuation Allowances and Reserves [Roll Forward] | |||
Balance at Beginning of Period | 235,485 | 207,055 | 147,223 |
Charged to Costs and Expenses | 92,139 | 28,430 | 59,832 |
Charged to Other Accounts | 0 | 0 | 0 |
Deductions from Reserves | (15,476) | 0 | 0 |
Balance at End of Period | 312,148 | 235,485 | 207,055 |
Inventory Obsolescence Reserve | |||
Movement in Valuation Allowances and Reserves [Roll Forward] | |||
Balance at Beginning of Period | 20,043 | 22,632 | 11,748 |
Charged to Costs and Expenses | 35,666 | 30,053 | 32,434 |
Charged to Other Accounts | 0 | 0 | 0 |
Deductions from Reserves | (36,361) | (32,642) | (21,550) |
Balance at End of Period | $ 19,348 | $ 20,043 | $ 22,632 |