Cover Page
Cover Page - USD ($) $ in Billions | 12 Months Ended | ||
Oct. 31, 2020 | Dec. 11, 2020 | May 01, 2020 | |
Cover [Abstract] | |||
Document Type | 10-K | ||
Document Annual Report | true | ||
Document Period End Date | Oct. 31, 2020 | ||
Current Fiscal Year End Date | --10-31 | ||
Document Transition Report | false | ||
Entity File Number | 1-8649 | ||
Entity Registrant Name | THE TORO COMPANY | ||
Entity Incorporation, State or Country Code | DE | ||
Entity Tax Identification Number | 41-0580470 | ||
Entity Address, Address Line One | 8111 Lyndale Avenue South | ||
Entity Address, City or Town | Bloomington | ||
Entity Address, State or Province | MN | ||
Entity Address, Postal Zip Code | 55420-1196 | ||
City Area Code | 952 | ||
Local Phone Number | 888-8801 | ||
Title of 12(b) Security | Common Stock, par value $1.00 per share | ||
Trading Symbol | TTC | ||
Security Exchange Name | NYSE | ||
Entity Well-known Seasoned Issuer | Yes | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Interactive Data Current | Yes | ||
Entity Filer Category | Large Accelerated Filer | ||
Entity Small Business | false | ||
Entity Emerging Growth Company | false | ||
ICFR Auditor Attestation Flag | true | ||
Entity Shell Company | false | ||
Entity Public Float | $ 6.7 | ||
Entity Common Stock, Shares Outstanding | 107,628,246 | ||
Documents Incorporated by Reference | Portions of the registrant's definitive Proxy Statement for the 2021 Annual Meeting of Shareholders expected to be held March 16, 2021 are incorporated by reference into Part III of this Annual Report on Form 10-K. | ||
Entity Central Index Key | 0000737758 | ||
Amendment Flag | false | ||
Document Fiscal Year Focus | 2020 | ||
Document Fiscal Period Focus | FY |
Consolidated Statements of Earn
Consolidated Statements of Earnings - USD ($) shares in Thousands, $ in Thousands | 12 Months Ended | ||
Oct. 31, 2020 | Oct. 31, 2019 | Oct. 31, 2018 | |
Income Statement [Abstract] | |||
Net sales | $ 3,378,810 | $ 3,138,084 | $ 2,618,650 |
Cost of sales | 2,189,036 | 2,090,121 | 1,677,639 |
Gross profit | 1,189,774 | 1,047,963 | 941,011 |
Selling, general and administrative expense | 763,417 | 722,934 | 567,926 |
Operating earnings | 426,357 | 325,029 | 373,085 |
Interest expense | (33,156) | (28,835) | (19,096) |
Other income, net | 13,869 | 25,939 | 18,408 |
Earnings before income taxes | 407,070 | 322,133 | 372,397 |
Provision for income taxes | 77,369 | 48,150 | 100,458 |
Net earnings | $ 329,701 | $ 273,983 | $ 271,939 |
Basic net earnings per share of common stock (in dollars per share) | $ 3.06 | $ 2.57 | $ 2.56 |
Diluted net earnings per share of common stock (in dollars per share) | $ 3.03 | $ 2.53 | $ 2.50 |
Weighted-average number of shares of common stock outstanding - Basic (in shares) | 107,658 | 106,773 | 106,369 |
Weighted-average number of shares of common stock outstanding - Diluted (in shares) | 108,663 | 108,090 | 108,657 |
Consolidated Statements of Comp
Consolidated Statements of Comprehensive Income - USD ($) $ in Thousands | 12 Months Ended | ||
Oct. 31, 2020 | Oct. 31, 2019 | Oct. 31, 2018 | |
Statement of Comprehensive Income [Abstract] | |||
Net earnings | $ 329,701 | $ 273,983 | $ 271,939 |
Other comprehensive income (loss), net of tax: | |||
Foreign currency translation adjustments, net of tax of $0, $(16), and $(222), respectively | 6,517 | (1,314) | (8,408) |
Derivative instruments, net of tax of $(2,782), $(862), and $2,899, respectively | (8,485) | (2,498) | 7,415 |
Pension and post-retirement benefits, net of tax of $45, $(1,305), and $254, respectively | (245) | (4,300) | 1,035 |
Other comprehensive income (loss), net of tax | (2,213) | (8,112) | 42 |
Comprehensive income | $ 327,488 | $ 265,871 | $ 271,981 |
Consolidated Statements of Co_2
Consolidated Statements of Comprehensive Income (Parenthetical) - USD ($) $ in Thousands | 12 Months Ended | ||
Oct. 31, 2020 | Oct. 31, 2019 | Oct. 31, 2018 | |
Statement of Comprehensive Income [Abstract] | |||
Foreign currency translation adjustments, tax | $ 0 | $ (16) | $ (222) |
Derivative instruments, tax | (2,782) | (862) | 2,899 |
Pension and retiree medical benefits, tax | $ 45 | $ (1,305) | $ 254 |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Thousands | Oct. 31, 2020 | Oct. 31, 2019 |
ASSETS | ||
Cash and cash equivalents | $ 479,892 | $ 151,828 |
Receivables, net: | ||
Customers, net of allowances (2020 - $4,586; 2019 - $3,270) | 223,105 | 220,534 |
Receivables from finance affiliate | 12,619 | 21,873 |
Other | 25,411 | 26,361 |
Total receivables, net | 261,135 | 268,768 |
Inventories, net | 652,433 | 651,663 |
Prepaid expenses and other current assets | 34,188 | 50,632 |
Total current assets | 1,427,648 | 1,122,891 |
Property, plant and equipment, net | 467,919 | 437,317 |
Goodwill | 424,075 | 362,253 |
Other intangible assets, net | 408,305 | 352,374 |
Right-of-use assets | 78,752 | |
Investment in finance affiliate | 19,745 | 24,147 |
Deferred income taxes | 6,466 | 6,251 |
Other assets | 20,318 | 25,314 |
Total assets | 2,853,228 | 2,330,547 |
LIABILITIES AND STOCKHOLDERS' EQUITY | ||
Current portion of long-term debt | 99,873 | 79,914 |
Accounts payable | 363,953 | 319,230 |
Short-term lease liabilities | 15,447 | |
Accrued liabilities: | ||
Warranty | 107,121 | 96,604 |
Advertising and marketing programs | 98,883 | 103,417 |
Compensation and benefit costs | 58,789 | 76,862 |
Insurance | 13,452 | 11,164 |
Interest | 10,065 | 9,903 |
Other | 88,214 | 59,876 |
Total accrued liabilities | 376,524 | 357,826 |
Total current liabilities | 855,797 | 756,970 |
Long-term debt, less current portion | 691,250 | 620,899 |
Long-term lease liabilities | 66,641 | |
Deferred income taxes | 70,435 | 50,579 |
Other long-term liabilities | 54,277 | 42,521 |
Stockholders' equity: | ||
Preferred stock, par value $1.00 per share, authorized 1,000,000 voting and 850,000 non-voting shares, none issued and outstanding | 0 | 0 |
Common stock, par value $1.00 per share, authorized 175,000,000 shares; issued and outstanding 107,582,670 shares as of October 31, 2020 and 106,742,082 shares as of October 31, 2019 | 107,583 | 106,742 |
Retained earnings | 1,041,507 | 784,885 |
Accumulated other comprehensive loss | (34,262) | (32,049) |
Total stockholders' equity | 1,114,828 | 859,578 |
Total liabilities and stockholders' equity | $ 2,853,228 | $ 2,330,547 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Thousands | Oct. 31, 2020 | Oct. 31, 2019 |
ASSETS | ||
Customers, allowance for doubtful accounts (in dollars) | $ 4,586 | $ 3,270 |
Preferred stock | ||
Preferred stock, par value (in dollars per share) | $ 1 | $ 1 |
Preferred stock, issued (in shares) | 0 | 0 |
Preferred stock, outstanding (in shares) | 0 | 0 |
Common stock | ||
Common stock, par value (in dollars per share) | $ 1 | $ 1 |
Common stock, authorized (in shares) | 175,000,000 | 175,000,000 |
Common stock, issued (in shares) | 107,582,670 | 106,742,082 |
Common stock, outstanding (in shares) | 107,582,670 | 106,742,082 |
Voting Preferred Stock | ||
Preferred stock | ||
Preferred stock, authorized (in shares) | 1,000,000 | 1,000,000 |
Nonvoting Preferred Stock | ||
Preferred stock | ||
Preferred stock, authorized (in shares) | 850,000 | 850,000 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 12 Months Ended | ||
Oct. 31, 2020 | Oct. 31, 2019 | Oct. 31, 2018 | |
Cash flows from operating activities: | |||
Net earnings | $ 329,701 | $ 273,983 | $ 271,939 |
Adjustments to reconcile net earnings to net cash provided by operating activities: | |||
Non-cash income from finance affiliate | (7,663) | (11,948) | (11,143) |
Proceeds from Equity Method Investment, Distribution | 12,066 | 10,343 | 9,228 |
Depreciation of property, plant and equipment | 76,108 | 69,314 | 53,484 |
Amortization of other intangible assets | 19,507 | 18,384 | 7,793 |
Fair value step-up adjustment to acquired inventory | 3,951 | 39,368 | 0 |
Stock-based compensation expense | 15,408 | 13,429 | 12,161 |
Deferred income taxes | 2,269 | (6,190) | 25,255 |
Other | 492 | 6,357 | 507 |
Changes in operating assets and liabilities, net of the effect of acquisitions: | |||
Receivables, net | 15,206 | (11,042) | (10,365) |
Inventories, net | 20,963 | (104,832) | (29,770) |
Prepaid expenses and other assets | 11,828 | 9,747 | (11,744) |
Accounts payable, accrued liabilities, deferred revenue and other liabilities | 39,538 | 30,458 | 47,460 |
Net cash provided by operating activities | 539,374 | 337,371 | 364,805 |
Cash flows from investing activities: | |||
Purchases of property, plant and equipment | (78,068) | (92,881) | (90,124) |
Proceeds from asset disposals | 216 | 4,669 | 151 |
Proceeds from sale of a business | 0 | 12,941 | 0 |
Investments in unconsolidated entities | 0 | (200) | (6,750) |
Acquisitions, net of cash acquired | (138,225) | (697,471) | (31,202) |
Net cash used in investing activities | (216,077) | (772,942) | (127,925) |
Cash flows from financing activities: | |||
Borrowings under debt arrangements | 636,025 | 900,000 | 0 |
Repayments under debt arrangements | (546,025) | (511,000) | (19,757) |
Proceeds from exercise of stock options | 22,198 | 29,336 | 17,243 |
Payments of withholding taxes for stock awards | (2,146) | (2,662) | (4,095) |
Purchases of TTC common stock | 0 | (20,043) | (160,435) |
Dividends paid on TTC common stock | (107,698) | (96,133) | (85,031) |
Net cash provided by (used in) financing activities | 2,354 | 299,498 | (252,075) |
Effect of exchange rates on cash and cash equivalents | 2,413 | (1,223) | (5,937) |
Net increase (decrease) in cash and cash equivalents | 328,064 | (137,296) | (21,132) |
Cash and cash equivalents as of the beginning of the fiscal period | 151,828 | 289,124 | 310,256 |
Cash and cash equivalents as of the end of the fiscal period | 479,892 | 151,828 | 289,124 |
Cash paid during the fiscal year for: | |||
Interest | 34,109 | 30,167 | 19,979 |
Income taxes | $ 69,524 | $ 54,738 | $ 75,805 |
Consolidated Statements of Stoc
Consolidated Statements of Stockholders' Equity - USD ($) $ in Thousands | Total | Cumulative Effect, Period of Adoption, Adjustment | Common Stock | Retained Earnings | Retained EarningsCumulative Effect, Period of Adoption, Adjustment | Accumulated Other Comprehensive Loss | Accumulated Other Comprehensive LossCumulative Effect, Period of Adoption, Adjustment |
Balance as of the beginning of the fiscal period at Oct. 31, 2017 | $ 617,092 | $ 0 | $ 106,883 | $ 534,329 | $ (141) | $ (24,120) | $ 141 |
Increase (Decrease) in Stockholders' Equity | |||||||
Cash dividends paid on common stock | (85,031) | (85,031) | |||||
Issuance of shares for stock options exercised and restricted stock units vested | 15,806 | 1,496 | 14,310 | ||||
Stock-based compensation expense | 12,161 | 12,161 | |||||
Contribution of stock to a deferred compensation trust | 1,437 | 1,437 | |||||
Purchase of shares of common stock | (164,530) | (2,778) | (161,752) | ||||
Other comprehensive income (loss) | 42 | 42 | |||||
Net earnings | 271,939 | 271,939 | |||||
Balance as if the end of the fiscal period at Oct. 31, 2018 | $ 668,916 | $ 864 | 105,601 | 587,252 | $ 864 | (23,937) | |
Increase (Decrease) in Stockholders' Equity | |||||||
Accounting Standards Update [Extensible List] | us-gaap:AccountingStandardsUpdate201812Member | ||||||
Cash dividends paid on common stock | $ (96,133) | (96,133) | |||||
Issuance of shares for stock options exercised and restricted stock units vested | 27,932 | 1,545 | 26,387 | ||||
Stock-based compensation expense | 13,429 | 13,429 | |||||
Contribution of stock to a deferred compensation trust | 1,404 | 1,404 | |||||
Purchase of shares of common stock | (22,705) | (404) | (22,301) | ||||
Other comprehensive income (loss) | (8,112) | (8,112) | |||||
Net earnings | 273,983 | 273,983 | |||||
Balance as if the end of the fiscal period at Oct. 31, 2019 | $ 859,578 | 106,742 | 784,885 | (32,049) | |||
Increase (Decrease) in Stockholders' Equity | |||||||
Accounting Standards Update [Extensible List] | us-gaap:AccountingStandardsUpdate201409Member | ||||||
Cash dividends paid on common stock | $ (107,698) | (107,698) | |||||
Issuance of shares for stock options exercised and restricted stock units vested | 19,630 | 870 | 18,760 | ||||
Stock-based compensation expense | 15,408 | 15,408 | |||||
Contribution of stock to a deferred compensation trust | 2,568 | 2,568 | |||||
Purchase of shares of common stock | (2,146) | (29) | (2,117) | ||||
Other comprehensive income (loss) | (2,213) | (2,213) | |||||
Net earnings | 329,701 | 329,701 | |||||
Balance as if the end of the fiscal period at Oct. 31, 2020 | $ 1,114,828 | $ 107,583 | $ 1,041,507 | $ (34,262) |
Consolidated Statements of St_2
Consolidated Statements of Stockholders' Equity (Parenthetical) - $ / shares | 12 Months Ended | ||
Oct. 31, 2020 | Oct. 31, 2019 | Oct. 31, 2018 | |
Statement of Stockholders' Equity [Abstract] | |||
Cash dividends paid on common stock (in dollars per share) | $ 1 | $ 0.90 | $ 0.80 |
Issuance of options (in shares) | 870,011 | 1,544,962 | 1,495,367 |
Purchase of shares of common stock (in shares) | 29,422 | 403,532 | 2,777,687 |
Summary of Significant Accounti
Summary of Significant Accounting Policies and Related Data | 12 Months Ended |
Oct. 31, 2020 | |
Accounting Policies [Abstract] | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES AND RELATED DATA | 1 Summary of Significant Accounting Policies and Related Data The Toro Company is in the business of designing, manufacturing, and marketing professional turf maintenance equipment and services; turf irrigation systems; landscaping equipment and lighting products; snow and ice management products; agricultural irrigation ("ag-irrigation") systems; rental, specialty, and underground construction equipment; and residential yard and snow thrower products. The Toro Company sells its products worldwide through a network of distributors, dealers, mass retailers, hardware retailers, equipment rental centers, home centers, as well as online (direct to end-users). The Toro Company strives to provide innovative, well-built, and dependable products supported by an extensive service network. The following are The Toro Company's significant accounting policies in addition to those included in the other Notes to Consolidated Financial Statements included within this Part II, Item 8, "Financial Statements and Supplementary Data," of this Annual Report on Form 10-K. Basis of Presentation and Consolidation The accompanying Consolidated Financial Statements have been prepared in accordance with accounting principles generally accepted ("GAAP") in the United States ("U.S.") and include the accounts of The Toro Company and its wholly-owned subsidiaries. Unless the context indicates otherwise, the terms "company," "TTC," "we," "our," or "us" refer to The Toro Company and its consolidated subsidiaries. In the opinion of management, the Consolidated Financial Statements include all adjustments, consisting primarily of recurring accruals, considered necessary for the fair presentation of the company's Consolidated Financial Position, Results of Operations, and Cash Flows for the periods presented. The company's businesses are organized, managed, and internally grouped into segments based on similarities in products and services. The company classifies its operations into two reportable business segments: Professional and Residential. The company's remaining activities are presented as "Other" due to their insignificance. Such Other activities consist of earnings (loss) from the company's wholly-owned domestic distribution companies, corporate activities, and the elimination of intersegment revenues and expenses. For additional information regarding the company's reportable business segments refer to Note 3, Segment Data . The company uses the equity method to account for equity investments in unconsolidated entities over which it has the ability to exercise significant influence over operating and financial policies. The company's share of the net earnings (losses) of these equity method investments are recorded within other income, net on the Consolidated Statements of Earnings. Equity investments in unconsolidated entities that the company does not control and for which it does not have the ability to exercise significant influence over operating and financial policies are recorded at cost, less impairment, as applicable, within the Consolidated Balance Sheets. All intercompany accounts and transactions have been eliminated from the Consolidated Financial Statements. Impact of COVID-19 In March 2020, the World Health Organization declared the novel coronavirus ("COVID-19" or "the pandemic") outbreak a global pandemic. The global outbreak of COVID-19 negatively impacted portions of the global economy, disrupted global supply chains, and created volatility in financial markets. COVID-19 has had a material impact on the company and the future broader implications of the pandemic on the company remain uncertain and will depend on certain future developments, including the duration, scope, and severity of the pandemic; its impact on the company's employees, customers, and suppliers; and the range of government mandated restrictions and other measures. This uncertainty could have a material impact on accounting estimates and assumptions utilized to prepare the Consolidated Financial Statements in future reporting periods, which could result in a material adverse impact on the company's Consolidated Financial Position, Results of Operations, and Cash Flows. Accounting Estimates In preparing the Consolidated Financial Statements in conformity with U.S. GAAP, management must make decisions that impact the reported amounts of assets, liabilities, revenues, expenses, and the related disclosures, including disclosures of contingent assets and liabilities. Such decisions include the selection of the appropriate accounting principles to be applied and the assumptions on which to base accounting estimates. Estimates are used in determining, among other items, sales promotion and incentive accruals, incentive compensation accruals, income tax accruals, inventory valuation, warranty reserves, allowance for doubtful accounts, pension and post-retirement accruals, self-insurance accruals, right-of-use assets and lease liabilities, useful lives for tangible and finite-lived intangible assets, future cash flows associated with impairment testing for goodwill, indefinite-lived intangible assets and other long-lived assets, and valuations of the assets acquired and liabilities assumed in a business combination, when applicable. These estimates and assumptions are based on management's best estimates and judgments at the time they are made and are generally derived from management's understanding and analysis of the relevant and current circumstances, historical experience, and actuarial and other independent external third-party specialist valuations, when applicable. Management evaluates its estimates and assumptions on an ongoing basis using historical experience and other factors that management believes to be reasonable under the circumstances, including the current economic environment and other factors, as applicable. Management adjusts such estimates and assumptions when facts and circumstances dictate. As future events and their effects cannot be determined with certainty, including those impacted by COVID-19, actual amounts could differ significantly from those estimated at the time the Consolidated Financial Statements are prepared. Changes in those estimates will be reflected in the Consolidated Financial Statements in future periods. Business Combinations The company accounts for the acquisition of a business in accordance with the accounting standards codification ("ASC") guidance for business combinations, whereby the total consideration transferred is allocated to the assets acquired and liabilities assumed, including amounts attributable to non-controlling interests, when applicable, based on their respective estimated fair values as of the date of acquisition. Goodwill represents the excess of consideration transferred over the estimated fair value of the net assets acquired in a business combination. Assigning estimated fair values to the net assets acquired requires the use of significant estimates, judgments, inputs, and assumptions regarding the fair value of the assets acquired and liabilities assumed. Estimated fair values of assets acquired and liabilities assumed are based on available historical information, future expectations, and assumptions determined to be reasonable but are inherently uncertain with respect to future events, including economic conditions, competition, the useful life of the acquired assets, and other factors. The company may refine the estimated fair values of assets acquired and liabilities assumed, if necessary, over a period not to exceed one year from the date of acquisition by taking into consideration new information that, if known at the date of acquisition, would have affected the estimated fair values ascribed to the assets acquired and liabilities assumed. The judgments made in determining the estimated fair value assigned to assets acquired and liabilities assumed, as well as the estimated useful life and depreciation or amortization method of each asset, can materially impact the net earnings of the periods subsequent to the acquisition through depreciation and amortization, and in certain instances through impairment charges, if the asset becomes impaired in the future. During the measurement period, any purchase price allocation changes that impact the carrying value of goodwill affects any measurement of goodwill impairment taken during the measurement period, if applicable. Refer to Note 2, Business Combinations , for additional information regarding the company's accounting for recent business combinations. Cash and Cash Equivalents The company considers all highly liquid investments purchased with an original maturity of three months or less to be cash equivalents. Cash equivalents are stated at cost, which approximates fair value. As of October 31, 2020 and 2019, cash and cash equivalents held by the company's foreign subsidiaries were $106.3 million and $97.5 million, respectively. Receivables, Net The company's financial exposure related to the collection of accounts receivable is primarily reduced due to its Red Iron Acceptance, LLC ("Red Iron") joint venture with TCF Inventory Finance, Inc. ("TCFIF") and separate arrangement with TCF Commercial Finance Canada, Inc. ("TCFCFC"), as further discussed in Note 8, Investment in Joint Venture . The company also has floor plan financing agreements with separate third-party financial institutions to provide inventory financing to certain dealers not financed through Red Iron, which include agreements with third-party financial institutions in the U.S. and internationally in Australia. For receivables not serviced through Red Iron or other third-party floor plan financing agreements, the company provides financing in the form of open account terms in the normal course of business and performs on-going credit evaluations of customers. Receivables are recorded at original carrying amount less estimated allowance for doubtful accounts. The company estimates the balance of allowance for doubtful accounts by analyzing the age of accounts and notes receivable balances and applying historical write-off trend rates. The company also estimates and reserves separately, specific customer balances when it is deemed probable that the balance is uncollectible. Account balances are charged off against the allowance when all collection efforts have been exhausted. Concentrations of Credit Risk Financial instruments, which potentially subject the company to concentrations of credit risk, consist principally of accounts receivable and derivative instruments. Accounts receivable balances are concentrated in the Professional and Residential business segments. The credit risk associated with these business segments is limited because of the large number of customers in the company's customer base and their geographic dispersion. The credit risk associated with the company's derivative instruments is limited as the company enters into derivative instruments with multiple counterparties that are highly rated financial institutions. Inventories, Net Inventories are valued at the lower of cost or net realizable value, with cost determined by the first-in, first-out ("FIFO") and average cost methods for approximately 53.0 percent and 54.0 percent of total net inventories as of October 31, 2020 and 2019, respectively. All remaining inventories are valued at the lower of cost or market, with cost determined under the last-in, first-out ("LIFO") method. During fiscal 2020 and fiscal 2019, LIFO layers were not materially reduced. Additionally, the company records an inventory valuation adjustment for excess, slow-moving, and obsolete inventory that is equal to the excess of the cost of the inventory over the estimated net realizable value or market value for the inventory depending on the inventory costing method. Such inventory valuation adjustment is based on a review and comparison of current inventory levels to planned production, as well as planned and historical sales of the inventory. The inventory valuation adjustment to net realizable value or market value establishes a new cost basis of the inventory that cannot be subsequently reversed. As of October 31, 2020 and 2019, the company's inventory valuation adjustment for excess, slow-moving, and obsolete inventory was $37.9 million and $40.3 million, respectively. Inventories, net were as follows (in thousands): October 31 2020 2019 Raw materials and work in process $ 168,759 $ 179,967 Finished goods and service parts 565,761 553,767 Total FIFO value 734,520 733,734 Less: adjustment to LIFO value 82,087 82,071 Total inventories, net $ 652,433 $ 651,663 Property, Plant and Equipment, Net Property, plant and equipment assets are carried at cost less accumulated depreciation. The company generally accounts for depreciation of property, plant and equipment utilizing the straight-line method over the estimated useful lives of the assets. Buildings and leasehold improvements are generally depreciated over 10 to 40 years, machinery and equipment are generally depreciated over two three two Property, plant and equipment, net was as follows (in thousands): October 31 2020 2019 Land and land improvements $ 57,387 $ 55,613 Buildings and leasehold improvements 301,848 276,556 Machinery and equipment 499,312 453,314 Tooling 231,142 226,870 Computer hardware and software 102,312 94,409 Construction in process 48,157 34,937 Property, plant and equipment, gross 1,240,158 1,141,699 Less: accumulated depreciation 772,239 704,382 Property, plant and equipment, net $ 467,919 $ 437,317 During fiscal years 2020, 2019, and 2018, the company recorded depreciation expense of $76.1 million, $69.3 million, and $53.5 million, respectively. Goodwill and Indefinite-Lived Intangible Assets Goodwill represents the cost of business combinations in excess of the fair values assigned to the identifiable net assets acquired. Goodwill is assigned to reporting units based upon the expected benefit of the synergies of the acquisition. Goodwill and certain trade names, which are considered to have indefinite lives, are not amortized; however, the company reviews them for impairment annually during the fourth quarter of each fiscal year or more frequently if changes in circumstances or the occurrence of events indicate that the fair value may not be recoverable. During the fourth quarter of fiscal 2020, the company performed its annual goodwill impairment test. In performing the annual goodwill impairment test, the company first reviewed its reporting units and determined that it has eleven reporting units, which are the same as its eleven operating segments. Nine reporting units contain goodwill on their respective balance sheets. Next, the company elected to bypass the qualitative assessment and move directly to the quantitative goodwill impairment analysis. In performing the quantitative goodwill impairment analysis, the company compared the carrying value of each reporting unit, including goodwill, to its respective fair value. The carrying value of each reporting unit was determined based on the amount of equity required for the reporting unit's activities, considering the specific assets and liabilities of the reporting unit. The company did not assign corporate assets and liabilities that do not relate to the operations of the reporting unit, or are not considered in determining the fair value of the reporting unit, to the reporting units. The company's estimate of the respective fair values of its reporting units was determined under the income approach, which utilized various inputs and assumptions, including projected operating results and growth rates from the company's forecasting process, applicable tax rates, and a weighted-average cost of capital rate. Where available, and as appropriate, comparable market multiples and the company's market capitalization were also utilized to corroborate the results of the discounted cash flow models under the income approach. Based on the quantitative goodwill impairment analysis, the company determined there was no impairment of goodwill during fiscal 2020 for any of its reporting units as the fair values of the reporting units exceeded their respective carrying values, including goodwill. Further, no impairment of goodwill was recorded during fiscal years 2019 and 2018. During the fourth quarter of fiscal 2020, the company also performed a quantitative impairment analysis for its indefinite-lived intangible assets, which consist of certain trade names. The company's estimate of the fair values of its trade names are based on a discounted cash flow model, which utilized various inputs and assumptions. Such inputs and assumptions included projected revenues from the company's forecasting process, assumed royalty rates that could be payable if the company did not own the trade name, and a discount rate. Based on this quantitative impairment analysis, which was also performed in prior fiscal years, the company concluded its indefinite-lived intangible assets were not impaired during fiscal 2020, 2019, or 2018. Other Long-Lived Assets Other long-lived assets consist of property, plant and equipment; right-of-use assets associated with operating lease agreements, capitalized implementation costs for hosted cloud-computing arrangements; and finite-lived intangible assets. The company's finite-lived intangible assets are identifiable assets that were acquired as a result of business combinations and primarily consist of patents, non-compete agreements, customer relationships and lists, backlog, trade names, and developed technology and are amortized on a straight-line basis over periods ranging from one The company reviews other long-lived assets for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset, or asset group, may not be recoverable. Asset groups have identifiable cash flows and are largely independent of other asset groups. An impairment loss is recognized when estimated undiscounted future cash flows from the operation or disposition of the asset group are less than the carrying amount of the asset group. Measurement of an impairment loss is based on the excess of the carrying amount of the asset group over its fair value. Fair value is generally measured using a discounted cash flow model or independent appraisals, as appropriate. Based on the company's impairment analysis for other long-lived assets, the company did not have any impairment losses for fiscal 2020, 2019, and 2018. For other long-lived assets to be abandoned, the company tests for potential impairment. If the company commits to a plan to abandon or dispose of an other long-lived asset, or asset group, before the end of its previously estimated useful life, depreciation or amortization estimates are revised. Leases The company enters into contracts for operating lease agreements that convey the company's right to direct the use of, and obtain substantially all of the economic benefits from, an identified asset for a defined period of time in exchange for consideration. The lease term begins and is determined upon lease commencement, which is the point in time when the company takes possession of the identified asset, and includes all non-cancelable periods. Lease liabilities represent the company's obligation to make lease payments arising from the lease agreement. The company accounts for operating lease liabilities at lease commencement and on an ongoing basis as the present value of the minimum remaining lease payments under the respective lease term. Lease payments are determined at lease commencement and represent fixed lease payments as defined within the respective lease agreement or, in the case of certain lease agreements, variable lease payments that are measured as of the lease commencement date based on the prevailing index or market rate. Future adjustments to variable lease payments are defined and scheduled within the respective lease agreement and are determined based upon the prevailing market or index rate at the time of the adjustment relative to the market or index rate determined at lease commencement. Certain other lease agreements contain variable lease payments that are determined based upon actual utilization of the identified asset. Such future adjustments to variable lease payments and variable lease payments based upon actual utilization of the identified asset are not included within the determination of lease payments at commencement but rather, are recorded as variable lease expense in the period in which the variable lease cost is incurred. The company has operating leases with both lease components and non-lease components. For purposes of determining lease payments, the company accounts for lease components separately from non-lease components based on the relative market value of each component. Non-lease components typically consist of common area maintenance, utilities, and/or other repairs and maintenance services. The costs related to non-lease components are not included within the determination of lease payments at commencement. Minimum remaining lease payments are discounted to present value based on the rate implicit in the operating lease agreement or the estimated incremental borrowing rate at lease commencement if the rate implicit in the lease is not readily determinable. Right-of-use assets represent the company's right to use an underlying asset throughout the lease term and are measured as the amount of the corresponding operating lease liability for the respective operating lease agreement, adjusted for prepaid or accrued lease payments, the remaining balance of any lease incentives received, unamortized initial direct costs, and impairment of the operating lease right-of-use asset, as applicable. Lease expense for the company's operating leases is recognized on a straight-line basis over the lease term and is recorded within either cost of sales or selling, general and administrative expense in the Consolidated Statements of Earnings depending on the nature and use of the identified asset underlying the respective operating lease arrangement. The company does not recognize right-of-use assets and lease liabilities, but does recognize expense on a straight-line basis, for short-term operating leases which have a lease term of 12 months or less and do not include an option to purchase the underlying asset. Accounts Payable The company has a supply chain finance service agreement with a third-party financial institution to provide a web-based platform that facilitates the ability of participating suppliers to finance payment obligations from the company with the third-party financial institution. Participating suppliers may, at their sole discretion, make offers to finance one or more payment obligations of the company prior to their scheduled due dates at a discounted price to the third-party financial institution. The company's obligations to its suppliers, including amounts due and scheduled payment dates, are not affected by suppliers' decisions to finance amounts under this supply chain finance arrangement. As of October 31, 2020 and 2019, $63.5 million and $46.7 million, respectively, of the company's outstanding payment obligations had been placed on the third-party financial institution's supply chain finance web-based platform. Insurance The company is self-insured for certain losses relating to employee medical, dental, workers' compensation, and certain product liability claims. Specific stop loss coverages are provided for catastrophic claims in order to limit exposure to significant claims. Losses and claims are charged to net earnings when it is probable a loss has been incurred and the amount can be reasonably estimated. Self-insured liabilities are based on a number of factors, including historical claims experience, an estimate of claims incurred but not reported, demographic and severity factors, and utilizing valuations provided by independent third-party actuaries. Product Warranty Guarantees The company’s products are warranted to provide assurance that the product will function as expected and to ensure customer confidence in design, workmanship, and overall quality. Warranty coverage is generally provided for specified periods of time and on select products’ hours of usage, and generally covers parts, labor, and other expenses for non-maintenance repairs. Warranty coverage generally does not cover operator abuse or improper use. An authorized company distributor or dealer must perform warranty work. Distributors and dealers submit claims for warranty reimbursement and are credited for the cost of repairs, labor, and other expenses as long as the repairs meet the company's prescribed standards. Service support outside of the warranty period is provided by authorized distributors and dealers at the customer's expense. In addition to the standard warranties offered by the company on its products, the company also sells separately priced extended warranty coverage on select products for a prescribed period after the original warranty period expires. The company recognizes expense and records an accrual for estimated future warranty costs at the time of sale and also establishes accruals for major rework campaigns. Warranty accruals are based primarily on the estimated number of products under warranty, historical average costs incurred to service warranty claims, the trend in the historical ratio of claims to sales, and the historical length of time between the sale and resulting warranty claim. The company periodically assesses the adequacy of its warranty accruals based on changes in these factors and records any necessary adjustments if actual claims experience indicates that adjustments are necessary. The changes in accrued warranties were as follows (in thousands): Fiscal Years Ended October 31 2020 2019 2018 Beginning balance $ 96,604 $ 76,214 $ 74,155 Warranty provisions 60,273 57,277 49,160 Acquisitions 2,557 18,418 — Warranty claims (67,241) (58,878) (45,662) Changes in estimates 14,928 3,573 (1,439) Ending balance $ 107,121 $ 96,604 $ 76,214 Derivative Instruments and Hedging Activities Derivative instruments, consisting primarily of forward currency contracts, are used to hedge most foreign currency transactions, including forecasted sales and purchases denominated in foreign currencies. All derivative instruments are recognized on the Consolidated Balance Sheets at fair value as either assets or liabilities. If the derivative instrument is designated as a cash flow hedging instrument, changes in the fair values of the spot rate component of outstanding, highly effective cash flow hedging instruments included in the assessment of hedge effectiveness are recorded in other comprehensive income within accumulated other comprehensive loss (“AOCL”) on the Consolidated Balance Sheets and are subsequently reclassified to net earnings within the Consolidated Statements of Earnings during the same period in which the cash flows of the underlying hedged transaction affect net earnings. Changes in the fair values of hedge components excluded from the assessment of effectiveness are recognized immediately in net earnings under the mark-to-market approach. Derivatives that are not designated as cash flow hedging instruments are adjusted to fair value through other income, net, on the Consolidated Statements of Earnings. Foreign Currency Translation and Transactions The functional currency of the company's foreign operations is generally the applicable local currency. The functional currency is translated into U.S. dollars using the respective current exchange rate in effect as of the balance sheet date for balance sheet accounts and the respective weighted-average exchange rate during the fiscal year for revenue and expense accounts. The resulting translation adjustments are deferred as a component of other comprehensive income within the Consolidated Statements of Comprehensive Income and the Consolidated Statements of Stockholders' Equity. Gains or losses resulting from transactions denominated in foreign currencies are included in other income, net in the Consolidated Statements of Earnings. Debt Issuance Costs Debt issuance costs incurred in connection with securing the company’s financing arrangements are capitalized and amortized over the term of the respective financing arrangement under the straight-line method as the results obtained are not materially different from those that would result from the use of the effective interest method. Debt issuance costs are generally presented in the Consolidated Balance Sheets as a direct deduction from the carrying amount of the outstanding borrowings, consistent with debt discounts. However, the company classifies the debt issuance costs related to its $600.0 million five-year senior unsecured revolving credit facility ("revolving credit facility") within other assets on the Consolidated Balance Sheets, regardless of whether the company has any outstanding borrowings on the revolving credit facility. Debt issuance costs related to borrowings that are extinguished early are charged to expense at the time of retirement. Debt issuance costs, net of accumulated amortization, were $3.9 million and $4.5 million as of October 31, 2020 and 2019, respectively. Income Taxes Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years that those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income tax expense in the period that includes the enactment date. A valuation allowance is provided when, in management's judgment, it is more likely than not that some portion or all of the deferred tax asset will not be realized. The company has reflected the necessary deferred tax assets and liabilities in the accompanying Consolidated Balance Sheets. Management believes the future tax deductions will be realized principally through future taxable income, future reversals of existing taxable temporary differences, and carryback to taxable income in prior years. The company recognizes the effect of income tax positions only if those positions are more likely than not of being sustained. Recognized income tax positions are measured at the largest amount that is greater than 50.0 percent likely to be realized. Changes in recognition or measurement are reflected in the period in which the change in judgment occurs. The company also records interest and penalties related to unrecognized tax benefits within income tax expense. Revenue Recognition The company's primary source of revenue is generated through the sale of equipment and irrigation products and services to its customers, which primarily consist of a worldwide network of distributors, dealers, mass retailers, hardware retailers, home centers, as well as online (direct to end-users). The company enters into contracts with its customers for the sale of products or rendering of services in the ordinary course of business. A contract with commercial substance exists at the time the company receives and accepts a purchase order under a sales contract with a customer. The company recognizes revenue when, or as, performance obligations under the terms of a contract with its customer are satisfied, which occurs with the transfer of control of product or services. Control is typically transferred to the customer at the time a product is shipped, or in the case of certain agreements, when a product is delivered or as services are rendered. Revenue is recognized based on the transaction price, which is measured as the amount of consideration the company expects to receive in exchange for transferring product or rendering services pursuant to the terms of the contract with a customer. The amount of consideration the company receives and the revenue the company recognizes varies with changes in the variable consideration associated with the estimated expense of the company's sales promotions and incentives programs offered to customers, as well as anticipated product returns. A provision is made at the time revenue is recognized as a reduction of the transaction price for variable consideration, consisting primarily of expected product returns, rebates, floor plan costs, and other sales |
Business Combinations
Business Combinations | 12 Months Ended |
Oct. 31, 2020 | |
Business Combinations [Abstract] | |
Business Combinations | 2 Business Combinations Venture Products, Inc. ("Venture Products") On March 2, 2020 ("Venture Products closing date"), pursuant to an Agreement and Plan of Merger ("Venture Products merger agreement") and an agreement to purchase the real property used by Venture Products ("Venture Products purchase agreement") both dated January 20, 2020, the company completed its acquisition of Venture Products ("Venture Products transaction"), a privately held Ohio corporation and the manufacturer of Ventrac-branded products. Venture Products designs, manufactures, and markets articulating turf, landscape, and snow and ice management equipment for grounds, landscape contractor, golf, municipal, and rural acreage customers and provides innovative product offerings that broadened and strengthened the company's Professional segment and expanded its dealer network. The Venture Products transaction was structured as a merger, pursuant to which a wholly-owned subsidiary of the company merged with and into Venture Products, with Venture Products continuing as the surviving entity and a wholly-owned subsidiary of the company. As a result of the merger, all of the outstanding equity securities of Venture Products were canceled and now only represent the right to receive the applicable consideration as described in the Venture Products merger agreement. The Venture Products purchase agreement was with an affiliate of Venture Products and was for the real estate used by Venture Products. As of the Venture Products closing date, the company paid preliminary merger consideration of $165.9 million, which consisted of a cash payment of $136.4 million and a $29.5 million holdback to satisfy any indemnification or certain other obligations of Venture Products to TTC. The preliminary merger consideration was subject to certain customary adjustments based on, among other things, the amount of actual cash, debt, and working capital in the business of Venture Products as of the Venture Products closing date. During the third quarter of fiscal 2020, the company finalized the customary adjustments, which resulted in an aggregate merger consideration of $163.2 million ("Venture Products purchase price"). As a result, $4.5 million of the holdback set aside for such customary adjustments was released accordingly and the remaining holdback of $25.0 million is expected to expire during the company's fourth quarter of fiscal 2021. The company funded the cash payment with borrowings under its existing revolving credit facility. For additional information regarding the company's revolving credit facility utilized to fund the Venture Products purchase price, refer to Note 6, Indebtedness . As a result of the acquisition, the company incurred $0.6 million of acquisition-related transaction costs during the fiscal year ended October 31, 2020. Acquisition-related transaction costs are recorded within selling, general and administrative expense within the Consolidated Statements of Earnings. Preliminary Venture Products Purchase Price Allocation The company accounted for the acquisition in accordance with the accounting standards codification guidance for business combinations, whereby the Venture Products purchase price was allocated to the acquired net tangible and intangible assets of Venture Products based on their fair values as of the Venture Products closing date. Such fair values are based on internal company and independent external third-party valuations and are subject to change as certain asset and liability valuations are finalized. As of October 31, 2020, the company has substantially completed its process for measuring the fair values of the assets acquired and liabilities assumed based on information available as of the Venture Products closing date, with the exception of the company's valuation of income taxes as the company requires additional information to finalize its valuation of income taxes. Thus, the preliminary measurements of fair value reflected for income taxes are subject to change as additional information becomes available and as additional analysis is performed. The company expects to finalize its preliminary valuation of income taxes as soon as practicable, but no later than one year from the Venture Products closing date, as required. The following table summarizes the allocation of the Venture Products purchase price to the fair values assigned to the Venture Products assets acquired and liabilities assumed (in thousands): March 2, 2020 Cash and cash equivalents $ 3,476 Receivables 6,342 Inventories 23,000 Prepaid expenses and other current assets 239 Property, plant and equipment 26,976 Goodwill 62,252 Other intangible assets 75,300 Accounts payable (4,075) Accrued liabilities (5,959) Deferred income tax liabilities (20,850) Total fair value of net assets acquired 166,701 Less: cash and cash equivalents acquired (3,476) Total Venture Products purchase price $ 163,225 The goodwill recognized is primarily attributable to the value of the workforce, the reputation of Venture Products, expected future cash flows, and expected synergies, including customer and dealer growth opportunities and integrating and expanding existing product lines. Key areas of expected cost synergies include increased purchasing power for commodities, components, parts, and accessories, and supply chain consolidation. The goodwill resulting from the acquisition of Venture Products was recognized within the company's Professional segment and is the primary driver for the increase in the company's Professional segment goodwill to $412.1 million as of October 31, 2020 from $350.3 million as of October 31, 2019. Goodwill is non-deductible for tax purposes. Other Intangible Assets Acquired The allocation of the Venture Products purchase price to the net assets acquired resulted in the recognition of $75.3 million of other intangible assets as of the Venture Products closing date. The fair values of the acquired trade name and customer-related intangible assets were determined using the income approach. Under the income approach, an intangible asset's fair value is equal to the present value of future economic benefits to be derived from ownership of the asset. The fair value of the trade name was determined using the relief from royalty method, which is based on the hypothetical royalty stream that would be received if the company were to license the trade name and was based on expected future revenues. The fair value of the customer-related intangible asset was determined using the excess earnings method and was based on the expected operating cash flows attributable to the customer-related intangible asset, which were determined by deducting expected economic costs, including operating expenses and contributory asset charges, from revenue expected to be generated from the customer-related intangible asset. The useful lives of the trade name and customer-related intangible assets were determined based on the period of expected cash flows used to measure the fair value of the respective intangible assets adjusted as appropriate for entity-specific factors including legal, regulatory, contractual, competitive, economic, and/or other factors that may limit the useful life of the respective intangible asset. The fair values of the other intangible assets acquired on the Venture Products closing date, related accumulated amortization from the Venture Products closing date through October 31, 2020, and weighted-average useful lives in years were as follows (in thousands, except weighted-average useful life in years): Weighted-Average Useful Life in Years Gross Carrying Amount Accumulated Amortization Net Finite-lived - customer-related 16.0 $ 19,100 $ (796) $ 18,304 Indefinite-lived - trade name 56,200 — 56,200 Total other intangible assets, net $ 75,300 $ (796) $ 74,504 Results of Operations Venture Product's results of operations have been included within the company's Professional reportable segment in the company's Consolidated Financial Statements from the Venture Products closing date. During the fiscal year ended October 31, 2020, the company recognized $58.3 million of net sales from Venture Product's operations. Venture Product's operations had an immaterial impact on Professional segment earnings for the fiscal year ended October 31, 2020. Unaudited pro forma financial information has not been disclosed as the Venture Products acquisition was not considered material to the company's Consolidated Results of Operations. The Charles Machine Works, Inc. ("CMW") On April 1, 2019 ("CMW closing date"), pursuant to the Agreement and Plan of Merger dated February 14, 2019 ("CMW merger agreement"), the company completed the acquisition of CMW ("CMW transaction"), a privately held Oklahoma corporation. CMW designs, manufactures, and markets a range of professional products to serve the underground construction market, including horizontal directional drills, walk and ride trenchers, stand-on skid steers, vacuum excavators, asset locators, pipe rehabilitation solutions, and after-market tools. CMW provides innovative product offerings that broadened and strengthened the company's Professional segment product portfolio and expanded its dealer network, while also providing a complementary geographic manufacturing footprint. The CMW transaction was structured as a merger, pursuant to which a wholly-owned subsidiary of the company merged with and into CMW, with CMW continuing as the surviving entity and a wholly-owned subsidiary of the company. As a result of the merger, all of the outstanding equity securities of CMW were canceled and now only represent the right to receive the applicable consideration as described in the CMW merger agreement. At the CMW closing date, the company paid preliminary merger consideration of $679.3 million that was subject to customary adjustments based on, among other things, the amount of actual cash, debt, and working capital in the business of CMW at the CMW closing date. During the fourth quarter of fiscal 2019, the company finalized such cash, debt, and working capital adjustments and these adjustments resulted in an aggregate merger consideration of $685.0 million ("CMW purchase price"). The company funded the CMW purchase price by using a combination of cash proceeds from the issuance of borrowings under the company's unsecured senior term loan credit agreement and borrowings from the company's revolving credit facility. For additional information regarding the financing agreements utilized to fund the CMW purchase price, refer to Note 6, Indebtedness . As a result of the acquisition, the company incurred $10.2 million of acquisition-related transaction costs, all of which were incurred during the fiscal year ended October 31, 2019 and recorded within selling, general and administrative expense within the Consolidated Statements of Earnings for such fiscal period. CMW Purchase Price Allocation The company accounted for the acquisition in accordance with the accounting standards codification guidance for business combinations, whereby the CMW purchase price was allocated to the acquired net tangible and intangible assets of CMW based on their estimated fair values as of the CMW closing date. Such fair values are based on internal company and independent external third-party valuations. The following table summarizes the allocation of the CMW purchase price to the fair values assigned to the CMW assets acquired and liabilities assumed (in thousands): April 1, 2019 Cash and cash equivalents $ 16,341 Receivables 65,674 Inventories 241,429 Prepaid expenses and other current assets 8,050 Property, plant and equipment 142,779 Goodwill 134,657 Other intangible assets: Customer-related 130,800 Developed technology 20,900 Finite-lived trade names 5,200 Indefinite-lived trade names 103,700 Backlog 3,590 Other long-term assets 7,971 Accounts payable (35,892) Accrued liabilities (51,943) Deferred income tax liabilities (85,277) Other long-term liabilities (6,665) Total fair value of net assets acquired 701,314 Less: cash and cash equivalents acquired (16,341) Total CMW purchase price $ 684,973 The goodwill recognized is primarily attributable to the value of the workforce, the reputation of CMW and its brands, customer and dealer growth opportunities, and expected synergies. Key areas of expected cost synergies include increased purchasing power for commodities, components, parts, and accessories, supply chain consolidation, and administrative efficiencies. The goodwill resulting from the acquisition of CMW was recognized within the company's Professional segment and is mostly non-deductible for tax purposes. During the second quarter of fiscal 2020, the company completed its valuation of income taxes to finalize the CMW purchase price allocation, which resulted in a decrease to the carrying amount of Professional segment goodwill of $0.9 million from $350.3 million as of October 31, 2019. The allocation of the purchase price to the net assets acquired resulted in the recognition of $264.2 million of other intangible assets as of the CMW closing date. The fair values of the acquired trade name, customer-related, developed technology and backlog intangible assets were determined using the income approach whereby an intangible asset's fair value is equal to the present value of future economic benefits to be derived from ownership of the asset. The useful lives of the other intangible assets were determined based on the period of expected cash flows used to measure the fair value of the intangible assets adjusted as appropriate for entity-specific factors including legal, regulatory, contractual, competitive, economic, and/or other factors that may limit the useful life of the respective intangible asset. As of the CMW closing date, the acquired finite-lived intangible assets had a weighted average useful life of 16.6 years. The fair values of both the indefinite-lived and finite-live trade names were determined using the relief from royalty method, which is based on the hypothetical royalty stream that would be received if the company were to license the trade name and was based on expected future revenues. The weighted-average useful life of the finite-lived trade name intangible assets was determined to be 20.0 years as of the CMW closing date. The fair values of the customer-related, developed technology, and backlog intangible assets were determined using the excess earnings method and were based on the expected operating cash flows attributable to the respective other intangible asset, which were determined by deducting expected economic costs, including operating expenses and contributory asset charges, from revenue expected to be generated from the respective intangible asset. As of the CMW closing date, the weighted-average useful lives of the customer-related, developed technology, and backlog intangible assets were determined to be 18.3 years, 7.8 years, and 6 months, respectively. Unaudited Pro Forma Financial Information Unaudited pro forma financial information was prepared as if the CMW acquisition had taken place on November 1, 2017 for comparative purposes only. The unaudited pro forma financial information is not necessarily indicative of the results that would have been achieved had the acquisition actually taken place on November 1, 2017 and the unaudited pro forma financial information does not purport to be indicative of future Consolidated Results of Operations. The unaudited pro forma financial information does not reflect any synergies, operating efficiencies, and/or cost savings that have been and may continue to be realized from the integration of the acquisition. The unaudited pro forma results for the fiscal years ended October 31, 2019 and October 31, 2018 were adjusted to exclude the pro forma impact of the take-down of the inventory fair value step-up amount and amortization of the backlog intangible asset; include the pro forma impact of amortization of other intangible assets, excluding backlog, based on the purchase price allocations and useful lives; include the pro forma impact of the depreciation of property, plant, and equipment based on the purchase price allocations and useful lives; include the pro forma impact of additional interest expense relating to the acquisition; exclude the pro forma impact of transaction costs incurred by the company directly attributable to the acquisition; and include the pro forma tax effect of both earnings before income taxes and the pro forma adjustments. The following table presents unaudited pro forma financial information for fiscal 2019 and 2018 (in thousands, except per share data): October 31, 2019 October 31, 2018 Net sales $ 3,437,335 $ 3,332,636 Net earnings 1 363,452 276,722 Basic net earnings per share of common stock 3.40 2.60 Diluted net earnings per share of common stock 1 $ 3.36 $ 2.55 1 On January 1, 2019, CMW amended its retiree medical plans so that no employee hired, or rehired, after that date would be eligible for such retiree medical plans. CMW further amended its retiree medical plans on February 14, 2019 so that no employee who terminates employment after February 14, 2019 is eligible to participate in the retiree medical plans and to terminate its retiree medical plans effective December 31, 2019. The amendments and resulting termination of CMW's retiree medical plans resulted in a gain of $45.8 million. This gain is reflected within net earnings in the unaudited pro forma financial information for the fiscal year ended October 31, 2019. The impact on diluted net earnings per share of common stock for the fiscal year ended October 31, 2019 was $0.42 per diluted share of common stock. Northeastern U.S. Distribution Company Effective November 30, 2018, during the first quarter of fiscal 2019, the company completed the acquisition of substantially all of the assets of, and assumed certain liabilities of, a Northeastern U.S. distribution company. The purchase price of this acquisition was allocated to the identifiable assets acquired and liabilities assumed based on estimates of their fair value, with the excess purchase price recorded as goodwill. This acquisition was immaterial based on the company's Consolidated Financial Condition and Results of Operations. Additional purchase accounting disclosures have been omitted given the immateriality of this acquisition in relation to the company's Consolidated Financial Condition and Results of Operations. L.T. Rich Products, Inc. Effective March 19, 2018, during the second quarter of fiscal 2018, the company completed the acquisition of substantially all of the assets of, and assumed certain liabilities of, L.T. Rich Products, Inc., a manufacturer of professional zero-turn spreader/sprayers, aerators, and snow and ice management equipment. The addition of these products broadened and strengthened the company’s Professional segment solutions for landscape contractors and grounds professionals. The purchase price of this acquisition was allocated to the identifiable assets acquired and liabilities assumed based on estimates of their fair value, with the excess purchase price recorded as goodwill. This acquisition was immaterial based on the company's Consolidated Financial Condition and Results of Operations. Additional purchase accounting disclosures have been omitted given the immateriality of this acquisition in relation to the company's Consolidated Financial Condition and Results of Operations. |
Segment Data
Segment Data | 12 Months Ended |
Oct. 31, 2020 | |
Segment Reporting [Abstract] | |
Segment Data | 3 Segment Data The company's businesses are organized, managed, and internally grouped into segments based on similarities in products and services. Segment selection is based on the manner in which management organizes segments for making operating and investment decisions and assessing performance. The company has identified eleven operating segments and has aggregated certain of those segments into two reportable segments: Professional and Residential. The aggregation of the company's segments is based on the segments having the following similarities: economic characteristics, types of products and services, types of production processes, type or class of customers, and method of distribution. The company's remaining activities are presented as "Other" due to their insignificance. The Professional reportable business segment consists of turf and landscape equipment; rental, specialty, and underground construction equipment; snow and ice management equipment; and irrigation and lighting products. Turf and landscape equipment products include sports fields and grounds mowing and maintenance equipment, golf course mowing and maintenance equipment, landscape contractor mowing equipment, landscape creation and renovation equipment, and other maintenance equipment. Rental, specialty, and underground construction equipment products include horizontal directional drills, walk and ride trenchers, stand-on skid steers, vacuum excavators, stump grinders, turf renovation products, asset locators, pipe rehabilitation solutions, materials handling equipment, and other after-market tools. Snow and ice management equipment products primarily include snowplows; stand-on snow and ice removal equipment, including the related snowplow, snow brush, and snow thrower attachments; salt and sand spreaders; and related parts and accessories for light and medium duty trucks, utility task vehicles, skid steers, and front-end loaders. Irrigation and lighting products consist of sprinkler heads, electric and hydraulic valves, controllers, computer irrigation central control systems, coupling systems, and ag-irrigation drip tape and hose products, as well as professionally installed landscape lighting products offered through distributors and landscape contractors that also purchase irrigation products. Professional reportable business segment products are marketed and sold mainly through a network of distributors and dealers to professional users engaged in maintaining golf courses, sports fields, municipal properties, agricultural fields, residential and commercial landscapes, and removing snow and ice, as well as directly to government customers, rental companies, and large retailers. The Residential reportable business segment consists of walk power mowers, zero-turn riding mowers, snow throwers, replacement parts, and home solutions products, including grass trimmers, hedge trimmers, leaf blowers, blower-vacuums, chainsaws, Power Shovels, string trimmers, and underground, hose, and hose-end retail irrigation products sold in Australia and New Zealand. Residential reportable business segment products are marketed and sold to homeowners through a network of distributors and dealers, and through a broad array of home centers, hardware retailers, and mass retailers, as well as online. The company's Other activities consist of the company's wholly-owned domestic distribution companies, the company's corporate activities, and the elimination of intersegment revenues and expenses. Corporate activities include general corporate expenditures (finance, human resources, legal, information services, public relations, business development, and similar activities) and other unallocated corporate assets and liabilities, such as corporate facilities and deferred tax assets and liabilities. The accounting policies of the reportable business segments are the same as those described in the summary of significant accounting policies in Note 1, Summary of Significant Accounting Policies and Related Data . The company evaluates the performance of its Professional and Residential reportable business segment results based on earnings from operations plus other income, net. The reportable business segment's operating profits or losses include direct costs incurred at the reportable business segment's operating level plus allocated expenses, such as profit sharing and manufacturing expenses. The allocated expenses represent costs that these operations would have incurred otherwise, but do not include general corporate expenses, interest expense, and income taxes. Operating loss for the company's Other activities includes earnings (loss) from the company's domestic wholly-owned distribution companies, corporate activities, other income, and interest expense. The company accounts for intersegment gross sales at current market prices. The following tables present summarized financial information concerning the company's reportable business segments and Other activities (in thousands): Fiscal Year Ended October 31, 2020 Professional Residential Other Total Net sales $ 2,523,452 $ 820,745 $ 34,613 $ 3,378,810 Intersegment gross sales (eliminations) 46,703 80 (46,783) — Earnings (loss) before income taxes 426,560 113,669 (133,159) 407,070 Total assets 1,940,844 282,061 630,323 2,853,228 Capital expenditures 49,975 13,669 14,424 78,068 Depreciation and amortization $ 70,460 $ 12,607 $ 12,548 $ 95,615 Fiscal Year Ended October 31, 2019 Professional Residential Other Total Net sales $ 2,443,448 $ 661,274 $ 33,362 $ 3,138,084 Intersegment gross sales (eliminations) 59,453 310 (59,763) — Earnings (loss) before income taxes 380,914 65,151 (123,932) 322,133 Total assets 1,592,065 430,495 307,987 2,330,547 Capital expenditures 57,246 16,970 18,665 92,881 Depreciation and amortization $ 63,885 $ 11,897 $ 11,916 $ 87,698 Fiscal Year Ended October 31, 2018 Professional Residential Other Total Net sales $ 1,946,999 $ 654,413 $ 17,238 $ 2,618,650 Intersegment gross sales (eliminations) 29,798 312 (30,110) — Earnings (loss) before income taxes 399,806 64,807 (92,216) 372,397 Total assets 916,106 199,273 455,605 1,570,984 Capital expenditures 58,109 16,014 16,001 90,124 Depreciation and amortization $ 38,585 $ 9,999 $ 12,693 $ 61,277 During fiscal 2020, 2019, and 2018 no customer accounted for 10.0 percent or more of total consolidated gross sales. The following table presents the details of operating loss before income taxes for the company's Other activities (in thousands): Fiscal Years Ended October 31 2020 2019 2018 Corporate expenses $ (108,396) $ (124,422) $ (92,541) Interest expense (33,156) (28,835) (19,096) Earnings from wholly-owned domestic distribution companies and other income, net 8,393 29,325 19,421 Total operating loss $ (133,159) $ (123,932) $ (92,216) The following table presents net sales for groups of similar products and services (in thousands): Fiscal Years Ended October 31 2020 2019 2018 Equipment $ 2,985,295 $ 2,747,935 $ 2,210,047 Irrigation and lighting 393,515 390,149 408,603 Total net sales $ 3,378,810 $ 3,138,084 $ 2,618,650 The following geographic area data includes net sales based on product shipment destination and long-lived assets, which consist of property, plant and equipment, net, and is based on physical location in addition to allocated capital tooling from U.S. plant facilities (in thousands): Fiscal Years Ended October 31 United States International Countries Total 2020 Net sales $ 2,700,694 $ 678,116 $ 3,378,810 Long-lived assets $ 426,378 $ 41,541 $ 467,919 2019 Net sales $ 2,413,153 $ 724,931 $ 3,138,084 Long-lived assets $ 395,937 $ 41,380 $ 437,317 2018 Net sales $ 1,975,562 $ 643,088 $ 2,618,650 Long-lived assets $ 230,246 $ 41,213 $ 271,459 |
Revenue
Revenue | 12 Months Ended |
Oct. 31, 2020 | |
Revenue from Contract with Customer [Abstract] | |
Revenue | 4 Revenue The company enters into contracts with its customers for the sale of products or rendering of services in the ordinary course of business. A contract with commercial substance exists at the time the company receives and accepts a purchase order under a sales contract with a customer. The company recognizes revenue when, or as, performance obligations under the terms of a contract with its customer are satisfied, which occurs with the transfer of control of product or services. Control is typically transferred to the customer at the time a product is shipped, or in the case of certain agreements, when a product is delivered or as services are rendered. Revenue is recognized based on the transaction price, which is measured as the amount of consideration the company expects to receive in exchange for transferring product or rendering services pursuant to the terms of the contract with a customer. The amount of consideration the company receives and the revenue the company recognizes varies with changes in sales promotions and incentives offered to customers, as well as anticipated product returns. A provision is made at the time revenue is recognized as a reduction of the transaction price for expected product returns, rebates, floor plan costs, and other sales promotion and incentive expenses. If a contract contains more than one performance obligation, the transaction price is allocated to each performance obligation based on the relative standalone selling price of the respective promised good or service. The company does not recognize revenue in situations where collectability from the customer is not probable, and defers the recognition of revenue until collection is probable or payment is received and performance obligations are satisfied. Freight and shipping revenue billed to customers concurrent with revenue producing activities is included within revenue and the cost for freight and shipping is recognized as an expense within cost of sales when control has transferred to the customer. Shipping and handling activities that occur after control of the related products is transferred are treated as a fulfillment activity rather than a promised service, and therefore, are not considered a performance obligation. Sales, use, value-added, and other excise taxes the company collects concurrent with revenue producing activities are excluded from revenue. Incremental costs of obtaining a contract for which the performance obligations will be satisfied within the next twelve months are expensed as incurred. Incidental items, including goods or services, that are immaterial in the context of the contract are recognized as expense when incurred. Additionally, the company has elected not to disclose the balance of unfulfilled performance obligations for contracts with a contractual term of twelve months or less. The following tables disaggregate the company's reportable segment net sales by major product type and geographic market (in thousands): Fiscal Year Ended October 31, 2020 Professional Residential Other Total Revenue by product type: Equipment $ 2,175,794 $ 787,716 $ 21,785 $ 2,985,295 Irrigation 347,658 33,029 12,828 393,515 Total net sales $ 2,523,452 $ 820,745 $ 34,613 $ 3,378,810 Revenue by geographic market: United States $ 1,976,690 $ 689,391 $ 34,613 $ 2,700,694 International Countries 546,762 131,354 — 678,116 Total net sales $ 2,523,452 $ 820,745 $ 34,613 $ 3,378,810 Fiscal Year Ended October 31, 2019 Professional Residential Other Total Revenue by product type: Equipment $ 2,097,965 $ 628,521 $ 21,449 $ 2,747,935 Irrigation 345,483 32,753 11,913 390,149 Total net sales $ 2,443,448 $ 661,274 $ 33,362 $ 3,138,084 Revenue by geographic market: United States $ 1,853,054 $ 526,737 $ 33,362 $ 2,413,153 International Countries 590,394 134,537 — 724,931 Total net sales $ 2,443,448 $ 661,274 $ 33,362 $ 3,138,084 Fiscal Year Ended October 31, 2018 Professional Residential Other Total Revenue by product type: Equipment $ 1,582,024 $ 617,827 $ 10,196 $ 2,210,047 Irrigation 364,975 36,586 7,042 408,603 Total net sales $ 1,946,999 $ 654,413 $ 17,238 $ 2,618,650 Revenue by geographic market: United States $ 1,441,815 $ 516,509 $ 17,238 $ 1,975,562 International Countries 505,184 137,904 — 643,088 Total net sales $ 1,946,999 $ 654,413 $ 17,238 $ 2,618,650 Product Revenue The company's product revenues are generated through sales of manufactured equipment and irrigation products, including related replacement parts and accessories. For the majority of the company's products, control is transferred and revenue is recognized when the product is shipped from the company's manufacturing facilities or distribution centers to the company's customers, which primarily consist of distributors, dealers, and mass retailers. In certain situations, the company transfers control and recognizes revenue when delivery to the customer has occurred. Additionally, the company ships some of its products to a mass retailer's distribution centers on a consignment basis. The company retains control of its products stored at the mass retailer's distribution centers. As the company's products are removed from the distribution centers by the mass retailer and shipped to the mass retailer's stores, control is transferred from the company to the mass retailer. At that time, the company invoices the mass retailer and recognizes revenue for these consignment transactions. The company does not offer a right of return for products shipped to the mass retailer's stores from the distribution centers. Red Iron provides inventory financing to certain dealers and distributors of the company's equipment and irrigation products. The company also has floor plan financing arrangements with separate third-party financial institutions to provide floor plan financing to certain dealers not financed through Red Iron. When product sales are financed by Red Iron or other third-party financial institutions, the transactions are structured as an advance in the form of a payment to the company on behalf of a dealer or distributor with respect to invoices financed by the financial institutions. These payments extinguish the obligation of such dealer or distributor to make payment to the company under the terms of the applicable invoice. Under a separate agreement between each financial institution and the dealer or distributor, the financial institution provides a loan to the dealer or distributor for the advances paid by the financial institutions to the company. The company's sales of product to customers that do not elect to finance purchases through Red Iron or the third-party financial institutions are generally on open account with terms that generally approximate 30 to 120 days and the resulting receivables are included within receivables, net on the Consolidated Balance Sheets. Product revenue is recognized based on the transaction price, which is measured as the amount of consideration the company expects to receive in exchange for transferring control of a product to a customer. When determining the transaction price, the company estimates variable consideration by applying the portfolio approach practical expedient under the accounting standards codification guidance for revenue from contracts with customers. The primary sources of variable consideration for the company are rebate programs, volume incentive programs, floor plan and retail financing programs, cash discounts, and product returns. These sales promotions and incentives are recorded as a reduction to revenue at the time of the initial sale. The company estimates variable consideration related to equipment and irrigation products sold under its sales promotion and incentive programs using the expected value method, which is based on sales terms with customers, historical experience, field inventory levels, volume purchases, and known changes in relevant trends. There are no material instances where variable consideration is constrained and not recorded at the initial time of sale. Additionally, the company may offer to its customers the right to return eligible equipment and irrigation products, replacement parts, and accessories. Returns are recorded as a reduction to revenue based on anticipated sales returns estimated from sales terms, historical experience, and trend analysis. The company records obligations for returns within accrued liabilities in the Consolidated Balance Sheets and the right-of-return asset in prepaid expenses and other current assets in the Consolidated Balance Sheets. The refund liability and right-of-return asset are remeasured for changes in the estimate at each reporting date with a corresponding adjustment to net sales and cost of sales within the Consolidated Statements of Earnings. Service Revenue In certain cases, the company renders service contracts to customers, which typically range from 12 to 36 months. The company receives payment at the inception of the service contract and recognizes revenue over the term of the agreement in proportion to the costs expected to be incurred in satisfying the performance obligations under the service contract. Warranty Revenue In addition to the standard warranties offered by the company on its equipment and irrigation products intended to provide assurance that the product will function as expected, the company also sells separately priced extended warranty coverage on select products for a prescribed period after the standard warranty period expires, which typically range from 12 to 24 months. The company receives payment at the inception of the separately priced extended warranty contract and recognizes revenue over the term of the agreement in proportion to the costs expected to be incurred in satisfying the performance obligations under the separately priced extended warranty contract. Contract Liabilities Contract liabilities relate to deferred revenue recognized for cash consideration received at contract inception in advance of the company's performance under the respective contract and generally relate to the sale of separately priced extended warranty contracts, service contracts, and non-refundable customer deposits. The company recognizes revenue over the term of the contract in proportion to the costs expected to be incurred in satisfying the performance obligations under the separately priced extended warranty and service contracts. For non-refundable customer deposits, the company recognizes revenue as of the point in time in which the performance obligation has been satisfied under the contract with the customer, which typically occurs upon change in control at the time a product is shipped. As of October 31, 2020 and October 31, 2019, $21.9 million and $22.0 million, respectively, of deferred revenue associated with outstanding separately priced extended warranty contracts, service contracts, and non-refundable customer deposits was reported within accrued liabilities and other long-term liabilities in the Consolidated Balance Sheets. For the fiscal year ended October 31, 2020, the company recognized $10.6 million of the October 31, 2019 deferred revenue balance. The company expects to recognize approximately $10.1 million of the October 31, 2020 deferred revenue balance within net sales in the Consolidated Statements of Earnings in fiscal 2021 and $11.8 million thereafter. |
Goodwill and Other Intangible A
Goodwill and Other Intangible Assets | 12 Months Ended |
Oct. 31, 2020 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill and Other Intangible Assets | 5 Goodwill and Other Intangible Assets The company's acquisition of Venture Products on March 2, 2020 resulted in the recognition of $62.3 million and $75.3 million of preliminary goodwill and other intangible assets, respectively. The company's acquisition of CMW on April 1, 2019 resulted in the recognition of $134.7 million and $264.2 million of goodwill and other intangible assets, respectively. For additional information on the company's acquisitions of Venture Products and CMW, refer to Note 2, Business Combinations . Goodwill The changes in the carrying amount of goodwill by reportable segment for fiscal 2020 and 2019 were as follows (in thousands): Professional Residential Other Total Balance as of October 31, 2018 $ 214,827 $ 10,463 $ — $ 225,290 Goodwill acquired 135,524 — 1,534 137,058 Translation adjustments (101) 6 — (95) Balance as of October 31, 2019 350,250 10,469 1,534 362,253 Goodwill acquired 62,252 — — 62,252 Purchase price allocation adjustment (866) — — (866) Translation adjustments 425 11 — 436 Balance as of October 31, 2020 $ 412,061 $ 10,480 $ 1,534 $ 424,075 Other Intangible Assets The components of other intangible assets were as follows (in thousands, except weighted-average useful life in years): October 31, 2020 Weighted-Average Useful Life in Years Gross Carrying Amount Accumulated Amortization Net Patents 9.9 $ 18,257 $ (13,919) $ 4,338 Non-compete agreements 5.5 6,892 (6,831) 61 Customer-related 18.2 239,634 (48,005) 191,629 Developed technology 7.6 51,995 (35,208) 16,787 Trade names 15.4 7,530 (2,552) 4,978 Backlog and other 0.6 4,390 (4,390) — Total finite-lived 15.5 328,698 (110,905) 217,793 Indefinite-lived - trade names 190,512 — 190,512 Total other intangible assets, net $ 519,210 $ (110,905) $ 408,305 October 31, 2019 Weighted-Average Useful Life in Years Gross Carrying Amount Accumulated Amortization Net Patents 9.9 $ 18,230 $ (13,102) $ 5,128 Non-compete agreements 5.5 6,868 (6,786) 82 Customer-related 18.4 220,390 (33,547) 186,843 Developed technology 7.6 51,911 (31,289) 20,622 Trade names 15.4 7,496 (2,109) 5,387 Backlog and other 0.6 4,390 (4,390) — Total finite-lived 15.5 309,285 (91,223) 218,062 Indefinite-lived - trade names 134,312 — 134,312 Total other intangible assets, net $ 443,597 $ (91,223) $ 352,374 Amortization expense for finite-lived intangible assets for the fiscal years ended October 31, 2020, 2019, and 2018 was $19.5 million, $18.4 million, and $7.3 million, respectively. Estimated amortization expense for the succeeding fiscal years is as follows: 2021, $19.5 million; 2022, $18.3 million; 2023, $16.5 million; 2024, $15.5 million; 2025, $13.9 million; and after 2025, $134.1 million. |
Indebtedness
Indebtedness | 12 Months Ended |
Oct. 31, 2020 | |
Debt Disclosure [Abstract] | |
Indebtedness | 6 Indebtedness The following is a summary of the company's indebtedness (in thousands): October 31, 2020 October 31, 2019 Revolving credit facility $ — $ — $200 million term loan 100,000 100,000 $300 million term loan 180,000 180,000 $190 million term loan 90,000 — 3.81% series A senior notes 100,000 100,000 3.91% series B senior notes 100,000 100,000 7.8% debentures 100,000 100,000 6.625% senior notes 123,978 123,916 Less: unamortized discounts, debt issuance costs, and deferred charges 2,855 3,103 Total long-term debt 791,123 700,813 Less: current portion of long-term debt 99,873 79,914 Long-term debt, less current portion $ 691,250 $ 620,899 Principal payments required on the company's outstanding indebtedness, based on the maturity dates defined within the company's debt arrangements, for the succeeding five fiscal years are as follows: fiscal 2021, $13.5 million; fiscal 2022, $133.7 million; fiscal 2023, $69.8 million; fiscal 2024, $153.0 million; fiscal 2025, $0.0 million; and after fiscal 2025, $425.0 million. Revolving Credit Facility The company has a revolving credit facility with a borrowing capacity of $600.0 million that expires in June 2023. The revolving credit facility includes a $10.0 million sublimit for standby letters of credit and a $30.0 million sublimit for swingline loans. At the company's election, and with the approval of the named borrowers on the revolving credit facility and the election of the lenders to fund such increase, the aggregate maximum principal amount available under the facility may be increased by an amount up to $300.0 million. Funds are available under the revolving credit facility for working capital, capital expenditures, and other lawful corporate purposes, including, but not limited to, acquisitions and common stock repurchases, subject in each case to compliance with certain financial covenants described below. As of October 31, 2020, the company had no borrowings under the revolving credit facility and $2.5 million outstanding under the sublimit for standby letters of credit, which resulted in $597.5 million of unutilized availability under the revolving credit facility. As of October 31, 2019, the company had no borrowings under the revolving credit facility, $1.9 million outstanding under the sublimit for standby letters of credit, and $598.1 million of unutilized availability. Typically, outstanding borrowings under the company's revolving credit facility are classified as long-term debt within the company's Consolidated Balance Sheets as the company has the ability to extend the borrowings for the full-term of the facility. However, if the company intends to repay a portion of the outstanding balance within the next twelve months, the company reclassifies that portion to current portion of long-term debt within the Consolidated Balance Sheets. As of October 31, 2020 and October 31, 2019, no outstanding borrowings under the company's revolving credit facility were classified as current portion of long-term debt within the Consolidated Balance Sheets. The company's revolving credit facility contains customary covenants, including, without limitation, financial covenants, such as the maintenance of minimum interest coverage and maximum leverage ratios; and negative covenants, which among other things, limit disposition of assets, consolidations and mergers, restricted payments, liens, and other matters customarily restricted in such agreements. Most of these restrictions are subject to certain minimum thresholds and exceptions. The company was in compliance with all covenants related to the credit agreement for the company's revolving credit facility as of October 31, 2020. Outstanding loans under the revolving credit facility, if applicable, other than swingline loans, bear interest at a variable rate generally based on LIBOR or an alternative variable rate based on the highest of the Bank of America prime rate, the federal funds rate or a rate generally based on LIBOR, in each case subject to an additional basis point spread as defined in the credit agreement. Swingline loans under the revolving credit facility bear interest at a rate determined by the swingline lender or an alternative variable rate based on the highest of the Bank of America prime rate, the federal funds rate or a rate generally based on LIBOR, in each case subject to an additional basis point spread as defined in the credit agreement. Interest is payable quarterly in arrears. For the fiscal years ended October 31, 2020, 2019, and 2018, the company incurred interest expense of $0.8 million, $1.9 million, and $1.3 million, respectively, under the revolving credit facility. $500.0 Million Term Loan Credit Agreement In March 2019, the company entered into a term loan credit agreement with a syndicate of financial institutions for the purpose of partially funding the CMW purchase price and the related fees and expenses incurred in connection with such acquisition. The term loan credit agreement provided for a $200.0 million three-year unsecured senior term loan facility maturing on April 1, 2022 and a $300.0 million five-year unsecured senior term loan facility maturing on April 1, 2024 (collectively, the "$500.0 million term loan"). The funds under the $500.0 million term loan were received on the CMW closing date. There are no scheduled principal amortization payments prior to maturity on the $200.0 million three-year unsecured senior term loan facility. For the $300.0 million five-year unsecured senior term loan facility, the company is required to make quarterly principal amortization payments of 2.5 percent of the original aggregate principal balance reduced by any applicable prepayments beginning with the last business day of the thirteenth calendar quarter ending after April 1, 2019, with the remainder of the unpaid principal balance due at maturity. No principal payments are required during the first three and one-quarter (3.25) years of the $300.0 million five-year unsecured senior term loan facility. The term loan facilities may be prepaid and terminated at the company's election at any time without penalty or premium. Amounts repaid or prepaid may not be reborrowed. As of October 31, 2020, the company had prepaid $100.0 million and $120.0 million of the outstanding principal balances of the $200.0 million three-year unsecured senior term loan facility and $300.0 million five-year unsecured senior term loan facility, respectively. Thus, as of October 31, 2020, there was $100.0 million and $180.0 million outstanding under the $200.0 million three-year unsecured senior term loan facility and the $300.0 million five-year unsecured senior term loan facility, respectively. As of October 31, 2020, the company has reclassified $10.0 million of the outstanding principal balance of the $300.0 million five five Outstanding borrowings under the $500.0 million term loan bear interest at a variable rate based on LIBOR or an alternative variable rate, subject to an additional basis point spread as defined in the $500.0 million loan credit agreement. Interest is payable quarterly in arrears. For the fiscal years ended October 31, 2020 and 2019, the company incurred interest expense of $5.2 million and $7.5 million, respectively, on the outstanding borrowings under the $500.0 million term loan. The $500.0 million term loan contains customary covenants, including, without limitation, financial covenants generally consistent with those applicable under the company's revolving credit facility, such as the maintenance of minimum interest coverage and maximum leverage ratios; and negative covenants, which among other things, limit disposition of assets, consolidations and mergers, restricted payments, liens, and other matters customarily restricted in such agreements. Most of these restrictions are subject to certain minimum thresholds and exceptions. The company was in compliance with all covenants related to the company's $500.0 million term loan as of October 31, 2020. $190.0 Million Term Loan Credit Agreement On March 30, 2020, the company entered into a $190.0 million term loan credit agreement ("$190.0 million term loan") with certain financial institutions for the purpose of refinancing certain of its outstanding borrowings incurred in connection with the company's acquisition of Venture Products on March 2, 2020, and as a precautionary measure to increase the company's liquidity and preserve financial flexibility in light of the uncertainty in the global financial and commercial markets from COVID-19. The $190.0 million term loan provided for a $190.0 million three year unsecured senior term loan facility maturing on June 19, 2023. Beginning with the last business day of March 2021, the company is required to make quarterly amortization payments on the $190.0 million term loan equal to 5.0 percent for the first four payments and 7.5 percent thereafter of the original aggregate principal amount reduced by any applicable prepayments. The $190.0 million term loan may be prepaid and terminated at the company's election at any time without penalty or premium. Amounts repaid or prepaid may not be reborrowed. As of October 31, 2020, the company had prepaid $100.0 million of the outstanding principal balance of the $190.0 million term loan. As of October 31, 2020, the company has reclassified the remaining $89.9 million outstanding principal balance of the $190.0 million term loan, net of the related proportionate share of deferred debt issuance costs, to current portion of long-term debt within the Consolidated Balance Sheet. As of October 31, 2020, $13.5 million of the $89.9 million that has been reclassified to current portion of long-term debt within the Consolidated Balance Sheet represents required quarterly amortization payments due within the next twelve months and the remaining $76.4 million represents the amount the company intends to prepay utilizing anticipated cash flows from operations within the next twelve months. Outstanding borrowings under the $190.0 million term loan bear interest at a variable rate based on LIBOR or an alternative variable rate with a minimum rate of 0.75 percent, subject to an additional basis point spread as defined in the term loan credit agreement. Interest is payable quarterly in arrears. For the fiscal year ended October 31, 2020, the company incurred interest expense of $2.4 million on the outstanding borrowings under the $190.0 million term loan. The $190.0 million term loan contains customary covenants, including, without limitation, financial covenants generally consistent with those applicable under the company's revolving credit facility, such as the maintenance of minimum interest coverage and maximum leverage ratios; and negative covenants, which among other things, limit disposition of assets, consolidations and mergers, restricted payments, liens, and other matters customarily restricted in such agreements. Most of these restrictions are subject to certain minimum thresholds and exceptions. The company was in compliance with all covenants related to the $190.0 million term loan as of October 31, 2020. 3.81% Series A and 3.91% Series B Senior Notes On April 30, 2019, the company entered into a private placement note purchase agreement with certain purchasers ("holders") pursuant to which the company agreed to issue and sell an aggregate principal amount of $100.0 million of 3.81% Series A Senior Notes due June 15, 2029 ("Series A Senior Notes") and $100.0 million of 3.91% Series B Senior Notes due June 15, 2031 ("Series B Senior Notes" and together with the Series A Senior Notes, the "Senior Notes"). On June 27, 2019, the company issued $100.0 million of the Series A Senior Notes and $100.0 million of the Series B Senior Notes pursuant to the private placement note purchase agreement. The Senior Notes are senior unsecured obligations of the company. No principal is due on the Senior Notes prior to their stated due dates. The company has the right to prepay all or a portion of either series of the Senior Notes in an amount equal to not less than 10.0 percent of the principal amount of the Senior Notes then outstanding upon notice to the holders of the series of Senior Notes being prepaid for 100.0 percent of the principal amount prepaid, plus a make-whole premium, as set forth in the private placement note purchase agreement, plus accrued and unpaid interest, if any, to the date of prepayment. In addition, at any time on or after the date that is 90 days prior to the maturity date of the respective series, the company has the right to prepay all of the outstanding Senior Notes of such series for 100.0 percent of the principal amount so prepaid, plus accrued and unpaid interest, if any, to the date of prepayment. Upon the occurrence of certain change of control events, the company is required to prepay all of the Senior Notes for the principal amount thereof plus accrued and unpaid interest, if any, to the date of prepayment. Interest on the Senior Notes is payable semiannually on the 15th day of June and December in each year. For the fiscal years ended October 31, 2020 and 2019, the company incurred interest expense of $7.7 million and $2.6 million, respectively, on the Senior Notes. The private placement note purchase agreement contains customary representations and warranties of the company, as well as certain customary covenants, including, without limitation, financial covenants, such as the maintenance of minimum interest coverage and maximum leverage ratios, and other covenants, which, among other things, provide limitations on transactions with affiliates, mergers, consolidations and sales of assets, liens and priority debt. The company was in compliance with all representations, warranties, and covenants related to the private placement note purchase agreement as of October 31, 2020. 7.8% Debentures In June 1997, the company issued $175.0 million of debt securities consisting of $75.0 million of 7.125 percent coupon 10-year notes and $100.0 million of 7.8 percent coupon 30-year debentures. The $75.0 million of 7.125 percent coupon 10-year notes were repaid at maturity during fiscal 2007. In connection with the issuance of $175.0 million in long-term debt securities, the company paid $23.7 million to terminate three forward-starting interest rate swap agreements with notional amounts totaling $125.0 million. These swap agreements had been entered into to reduce exposure to interest rate risk prior to the issuance of the new long-term debt securities. As of the inception of one of the swap agreements, the company had received payments that were recorded as deferred income to be recognized as an adjustment to interest expense over the term of the new debt securities. As of the date the swaps were terminated, this deferred income totaled $18.7 million. The excess termination fees over the deferred income recorded was deferred and is being recognized as an adjustment to interest expense over the term of the debt securities issued. Interest on the debentures is payable semiannually on the 15th day of June and December in each year. For the fiscal years ended October 31, 2020, 2019 and 2018, the company incurred interest expense of $8.0 million, $7.9 million, and $8.0 million, respectively. 6.625% Senior Notes On April 26, 2007, the company issued $125.0 million in aggregate principal amount of 6.625 percent senior notes due May 1, 2037 and priced at 98.513 percent of par value. The resulting discount of $1.9 million is being amortized over the term of the notes using the straight-line method as the results obtained are not materially different from those that would result from the use of the effective interest method. Although the coupon rate of the senior notes is 6.625 percent, the effective interest rate is 6.741 percent after taking into account the issuance discount. The senior notes are unsecured senior obligations of the company and rank equally with the company's other unsecured and unsubordinated indebtedness. The indentures under which the senior notes were issued contain customary covenants and event of default provisions. The company may redeem some or all of the senior notes at |
Management Actions
Management Actions | 12 Months Ended |
Oct. 31, 2020 | |
Discontinued Operations and Disposal Groups [Abstract] | |
Management Actions | 7 Management Actions Toro Underground Wind Down On August 1, 2019, during the company's fiscal 2019 third quarter, the company announced a plan to wind down the company's Toro-branded large directional drill and riding trencher product categories within its Professional segment product portfolio ("Toro underground wind down"). As of October 31, 2020, the company has completed the Toro underground wind down. In connection with the Toro underground wind down, for the fiscal year ended October 31, 2020, the company recorded $0.9 million of pre-tax charges related to write-downs to net realizable value within cost of sales in the Consolidated Statements of Earnings. For the fiscal year ended October 31, 2019, the company recorded $8.8 million of pre-tax charges related to inventory write-downs to net realizable value and accelerated depreciation on fixed assets that will no longer be used within cost of sales in the Consolidated Statements of Earnings as a result of the Toro underground wind down. Additionally, the company recorded $1.2 million of pre-tax charges related to inventory retail support activities within net sales in the Consolidated Statements of Earnings during the fiscal year ended October 31, 2019. No pre-tax charges related to inventory retail support activities were incurred during the fiscal year ended October 31, 2020. As of October 31, 2019, the company had a remaining accrual balance of $0.9 million related to the anticipated inventory retail support activities within accrued liabilities in the Consolidated Balance Sheets. No accrual relating to inventory retail support activities was recorded within accrued liabilities in the Consolidated Balance Sheets as of October 31, 2020. Corporate Restructuring During the fourth quarter of fiscal 2019, the company incurred corporate restructuring charges related to employee severance costs as the company focused on aligning the company's operations in the most strategic and cost-effective structure subsequent to the CMW transaction. As a result of such corporate restructuring, the company recorded pre-tax charges of $0.6 million within cost of sales and pre-tax charges of $6.0 million within selling, general and administrative expense in the Consolidated Statements of Earnings during fiscal 2019. The company did not incur additional charges in fiscal 2020 related to this corporate restructuring event. Divestiture During the fourth quarter of fiscal 2019, the company divested of a used underground construction equipment business, which was acquired as a result of the company's acquisition of CMW. Such divestiture was immaterial based on the company's Consolidated Financial Condition and Results of Operations. |
Investment in Joint Venture
Investment in Joint Venture | 12 Months Ended |
Oct. 31, 2020 | |
Equity Method Investments and Joint Ventures [Abstract] | |
Investment in Joint Venture | 8 Investment in Joint Venture In fiscal 2009, the company and TCFIF, a subsidiary of TCF National Bank, established Red Iron, a joint venture in the form of a Delaware limited liability company that primarily provides inventory financing to certain distributors and dealers of certain of the company’s products in the U.S. Under such joint venture, the company owns 45.0 percent of Red Iron and TCFIF owns 55.0 percent of Red Iron. Under a separate agreement, TCFCFC provides inventory financing to dealers of the company's products in Canada. On December 20, 2019, during the first quarter of fiscal 2020, the company amended certain agreements pertaining to the Red Iron joint venture. The purpose of these amendments was, among other things, to: (i) adjust certain rates under the floor plan financing rate structure charged to the company’s distributors and dealers participating in financing arrangements through the Red Iron joint venture; (ii) extend the term of the Red Iron joint venture from October 31, 2024 to October 31, 2026, subject to two-year extensions thereafter unless either the company or TCFIF provides written notice to the other party of non-renewal at least one year prior to the end of the then-current term; (iii) amend certain exclusivity-related provisions, including the definition of the company's products that are subject to exclusivity, inclusion of a two-year review period by the company for products acquired in future acquisitions to assess, without a commitment to exclusivity, the potential benefits and detriments of including such acquired products under the Red Iron financing arrangement, and the pro-rata payback over a five-year period of the exclusivity incentive payment the company received from TCFIF in 2016; (iv) extend the maturity date of the revolving credit facility used by Red Iron primarily to finance the acquisition of inventory from the company by its distributors and dealers from October 31, 2024 to October 31, 2026 and to increase the amount available under such revolving credit facility from $550.0 million to $625.0 million; and (v) memorialize certain other non-material amendments. The company accounts for its investment in Red Iron under the equity method of accounting. The company and TCFIF each contributed a specified amount of the estimated cash required to enable Red Iron to purchase the company's inventory financing receivables and to provide financial support for Red Iron's inventory financing programs. Red Iron borrows the remaining requisite estimated cash utilizing a $625.0 million secured revolving credit facility established under a credit agreement between Red Iron and TCFIF. The company's total investment in Red Iron as of October 31, 2020 and 2019 was $19.7 million and $24.1 million, respectively. The company has not guaranteed the outstanding indebtedness of Red Iron. Under the financing agreement between Red Iron and the company, Red Iron provides financing for certain dealers and distributors. These transactions are structured as an advance in the form of a payment by Red Iron to the company on behalf of a distributor or dealer with respect to invoices financed by Red Iron. These payments extinguish the obligation of the dealer or distributor to make payment to the company under the terms of the applicable invoice. The company has also entered into a limited inventory repurchase agreement with Red Iron and TCFCFC. Under such limited inventory repurchase agreement, the company has agreed to repurchase products repossessed by Red Iron and TCFCFC, up to a maximum aggregate amount of $7.5 million in a calendar year. The company's financial exposure under this limited inventory repurchase agreement is limited to the difference between the amount paid to Red Iron and TCFCFC for repurchases of repossessed product and the amount received upon the subsequent resale of the repossessed product. The company has repurchased immaterial amounts of inventory under this limited inventory repurchase agreement for the fiscal years ended October 31, 2020, 2019, and 2018. Under separate agreements between Red Iron and the dealers and distributors, Red Iron provides loans to the dealers and distributors for the advances paid by Red Iron to the company. The net amount of receivables financed for dealers and distributors under this arrangement during fiscal 2020, 2019, and 2018 was $1,832.5 million, $1,924.9 million, and $1,959.7 million, respectively. The total amount of receivables due from Red Iron to the company as of October 31, 2020 and 2019 were $12.6 million and $21.9 million, respectively. Summarized financial information for Red Iron is presented as follows (in thousands): For the Twelve Months Ended October 31 2020 2019 2018 Revenue $ 31,040 $ 47,569 $ 42,051 Interest and operating expenses, net (14,177) (21,011) (17,288) Net income $ 16,863 $ 26,558 $ 24,763 As of October 31 2020 2019 Finance receivables, net $ 386,781 $ 486,834 Other assets 2,929 3,733 Total assets $ 389,710 $ 490,567 Notes payable $ 332,838 $ 419,308 Other liabilities 12,994 17,594 Partners' capital 43,878 53,665 Total liabilities and partners' capital $ 389,710 $ 490,567 |
Income Taxes
Income Taxes | 12 Months Ended |
Oct. 31, 2020 | |
Income Tax Disclosure [Abstract] | |
Income taxes | 9 Income Taxes Earnings Before Income Taxes Earnings before income taxes were as follows (in thousands): Fiscal Years Ended October 31 2020 2019 2018 Earnings before income taxes: U.S. $ 369,016 $ 283,730 $ 333,136 Foreign 38,054 38,403 39,261 Total earnings before income taxes $ 407,070 $ 322,133 $ 372,397 Reconciliation of Effective Tax Rate A reconciliation of the statutory federal income tax rate to the company's effective tax rate is summarized as follows: Fiscal Years Ended October 31 2020 2019 2018 Statutory federal income tax rate 21.0 % 21.0 % 23.3 % Excess deduction for stock compensation (1.7) (3.7) (3.5) Domestic manufacturer's deduction — 0.1 (0.9) State and local income taxes, net of federal benefit 2.4 1.1 1.3 Foreign operations (0.6) (0.3) (0.5) Federal research tax credit (1.7) (1.5) (1.2) Foreign-derived intangible income — (1.3) — Remeasurement of deferred tax assets and liabilities — (0.1) 5.2 Deemed repatriation tax — (0.2) 3.6 Other, net (0.4) (0.2) (0.3) Effective tax rate 19.0 % 14.9 % 27.0 % On December 22, 2017, the U.S. enacted Public Law No. 115-97 ("Tax Act"), originally introduced as the Tax Cuts and Jobs Act, which significantly modified the Internal Revenue Code. The Tax Act reduced the U.S. federal corporate tax rate from 35.0 percent to 21.0 percent, created a territorial-type tax system with an exemption for foreign dividends, and imposed a one-time deemed repatriation tax on a U.S. company's historical undistributed earnings and profits of foreign affiliates. The tax rate change was effective January 1, 2018, which resulted in a blended statutory tax rate of 23.3 percent for the fiscal year ended October 31, 2018. The reduced tax rate of 21.0 percent was applicable to the fiscal years ended October 31, 2019 and 2020. Among other provisions, the Tax Act also increased expensing for certain business assets, created new taxes on certain foreign sourced earnings, provided an incentive on specified export activities, adopted limitations on business interest expense deductions, repealed deductions for income attributable to domestic production activities, and added other anti-base erosion rules. As of October 31, 2018, the company completed the accounting for the effects of the Tax Act. Included within the company's provision for income taxes in the Consolidated Statement of Earnings for the fiscal year ended October 31, 2018 are tax expense of $19.3 million for the remeasurement of deferred tax assets and liabilities, and tax expense of $13.4 million for the one-time transition tax on deemed repatriation tax of its non-U.S. subsidiaries. Included within the company's provision for income taxes in the Consolidated Statements of Earnings for the fiscal year ended October 31, 2019 are final adjustments related to the Tax Act, including a tax benefit of $0.3 million for the remeasurement of deferred tax assets and liabilities and a tax benefit of $0.7 million for the deemed repatriation. The Global Intangible Low-Taxed Income ("GILTI") provisions under the Tax Act requires the company to include in its U.S. income tax return any foreign subsidiary earnings in excess of an allowable return on the foreign subsidiary’s tangible assets. The impact of GILTI is included in foreign operations in the company's reconciliation of the statutory federal income tax rate to the company's effective tax rate above. The Foreign-Derived Intangible Income ("FDII") provisions of the Tax Act provide an incentive to domestic corporations in the form of a lower tax rate on income derived from tangible and intangible products and services in foreign markets. This lower tax rate is accomplished through an additional tax deduction based on a percentage of qualifying sales. The Coronavirus Aid, Relief, and Economic Security Act ("CARES Act") was signed into law on March 27, 2020. Among others, the CARES Act delayed payment of employer payroll taxes and modified net operating loss carryback provisions. The company has reflected the impact of the CARES Act for the fiscal year ended October 31, 2020 within its Consolidated Financial Statements and such impact was not material to the company's Consolidated Financial Statements. Provision for Income Taxes Components of the company's provision for income taxes were as follows (in thousands): Fiscal Years Ended October 31 2020 2019 2018 Current provision: Federal $ 58,243 $ 37,415 $ 64,375 State 11,322 7,495 6,192 Foreign 5,534 6,846 7,087 Total current provision $ 75,099 $ 51,756 $ 77,654 Deferred provision (benefit): Federal $ 1,710 $ (37) $ 22,074 State 634 (3,205) 308 Foreign (74) (364) 422 Total deferred provision (benefit) 2,270 (3,606) 22,804 Total provision for income taxes $ 77,369 $ 48,150 $ 100,458 Deferred Income Taxes The following table presents the tax effects of temporary differences that give rise to deferred income tax assets (liabilities), net (in thousands): October 31 2020 2019 Deferred income tax assets: Compensation and benefits $ 30,363 $ 27,969 Warranty and insurance 28,480 25,788 Lease liabilities 20,843 — Advertising and sales allowance 6,937 8,866 Inventory 4,937 4,005 Deferred revenue 2,910 4,373 Other 9,643 4,372 Valuation allowance (3,570) (3,199) Total deferred income tax assets $ 100,543 $ 72,174 Deferred income tax liabilities: Right-of-use assets $ (20,179) $ — Depreciation (49,018) (40,964) Amortization (95,315) (75,538) Total deferred income tax liabilities (164,512) (116,502) Deferred income tax liabilities, net $ (63,969) $ (44,328) The net change in the total valuation allowance between the fiscal years ended October 31, 2020 and 2019 was an increase of $0.4 million. The change in valuation allowance is related to branch foreign tax credits, state tax credits, net operating losses, and capital loss carryforwards that are expected to expire prior to utilization. As of October 31, 2020, the company had net operating loss carryforwards of approximately $3.7 million in foreign jurisdictions, which are comprised of $2.2 million that do not expire and $1.5 million that expire between fiscal 2020 and fiscal 2037. The company also had domestic credit carryforwards of $1.7 million that expires between fiscal 2024 and fiscal 2035. The company considers that $19.0 million of the total undistributed earnings of its foreign operations are intended to be indefinitely reinvested. Should these earnings be distributed in the future in the form of dividends or otherwise, the company may be subject to foreign withholding taxes, state income taxes, and/or additional federal taxes for currency fluctuations. As of October 31, 2020, the unrecognized deferred tax liabilities for temporary differences related to the company’s investment in non-U.S. subsidiaries, and any withholding, state, or additional federal taxes that may be applied upon any future repatriation, are expected to be immaterial and have not been recorded. Unrecognized Tax Benefits A reconciliation of the beginning and ending amount of unrecognized tax benefits is as follows (in thousands): Unrecognized tax benefits as of October 31, 2019 $ 2,673 Increase as a result of tax positions taken during a prior period 166 Decrease as a result of tax positions taken during the current period (183) Increase as a result of tax positions taken during the current period 291 Reductions as a result of statute of limitations lapses (87) Unrecognized tax benefits as of October 31, 2020 $ 2,860 The company recognizes interest and penalties related to unrecognized tax benefits as a component of the provision for income taxes within the Consolidated Statements of Earnings. In addition to the unrecognized tax benefits of $2.9 million, which have been recorded as an other accrued liability within the Consolidated Balance Sheets as of October 31, 2020, the company recorded $0.8 million of accrued interest and penalties as an other accrued liability within the Consolidated Balance Sheets as of October 31, 2020. Included in the balance of unrecognized tax benefits as of October 31, 2020 are potential benefits of $2.9 million that, if recognized, would affect the effective tax rate. The company and its wholly owned subsidiaries file income tax returns in the U.S. federal jurisdiction, and numerous state and foreign jurisdictions. With few exceptions, the company is no longer subject to U.S. federal, state and local, and foreign income tax examinations by tax authorities for taxable years before fiscal 2016. The company is under audit in certain state and foreign jurisdictions and expects various statutes of limitation to expire during the next 12 months. Due to the uncertainty related to the response of taxing authorities, a range of outcomes cannot be reasonably estimated at this time. |
Stock-Based Compensation Plans
Stock-Based Compensation Plans | 12 Months Ended |
Oct. 31, 2020 | |
Share-based Payment Arrangement [Abstract] | |
Stock-Based Compensation Plans | 10 Stock-Based Compensation Plans The company maintains the 2010 plan for executive officers, other employees, and non-employee members of the company's Board. The 2010 plan allows the company to grant stock-based compensation awards to such individuals, including unrestricted common stock awards, stock options, restricted stock units, restricted stock, and performance share awards. The number of unissued shares of common stock available for future stock-based compensation award grants under the 2010 plan was 3,740,799 as of October 31, 2020. Shares of common stock issued upon the exercise, vesting, or settlement of stock options, restricted stock units, and performance shares are issued from treasury shares. Compensation costs related to stock-based compensation awards were as follows (in thousands): Fiscal Years Ended October 31 2020 2019 2018 Unrestricted common stock awards $ 693 $ 592 $ 530 Stock option awards 9,163 6,537 5,006 Performance share awards 2,123 3,070 3,628 Restricted stock unit awards 3,429 3,230 2,997 Total compensation cost for stock-based awards $ 15,408 $ 13,429 $ 12,161 Related tax benefit from stock-based awards $ 3,696 $ 3,200 $ 2,905 Unrestricted Common Stock Awards During fiscal 2020, 2019, and 2018, 8,920, 10,090, and 8,388 shares, respectively, of fully vested unrestricted common stock awards were granted to certain non-employee members of the company's Board as a component of their compensation for their service on the Board and were recorded within selling, general and administrative expense in the Consolidated Statements of Earnings. Stock Option Awards Under the 2010 plan, stock options are granted with an exercise price equal to the closing price of the company's common stock on the date of grant, as reported by the New York Stock Exchange. Options are generally granted to executive officers, other employees, and non-employee members of the company's Board on an annual basis in the first quarter of the company's fiscal year. Options generally vest one-third each year over a three-year period and have a ten-year term. Other options granted to certain employees vest in full on the three-year anniversary of the date of grant and have a ten-year term. Compensation cost equal to the grant date fair value is generally recognized for these awards over the vesting period. Compensation cost recognized for other employees not considered executive officers and non-employee members of the company's Board is net of estimated forfeitures, which are determined at the time of grant based on historical forfeiture experience. Stock options granted to executive officers and other employees are subject to accelerated expensing if the option holder meets the retirement definition set forth in the 2010 plan. In that case, the fair value of the options is expensed in the fiscal year of grant because generally, if the option holder is employed as of the end of the fiscal year in which the options are granted, such options will not be forfeited but continue to vest according to their schedule following retirement. Similarly, if a non-employee director has served on the company's Board for ten The fair value of each stock option is estimated on the date of grant using the Black-Scholes valuation method with the assumptions noted in the table below. The expected life is a significant assumption as it determines the period for which the risk-free interest rate, expected stock price volatility, and expected dividend yield must be applied. The expected life is the average length of time in which executive officers, other employees, and non-employee members of the company's Board are expected to exercise their stock options, which is primarily based on historical exercise experience. The company groups executive officers and non-employee directors for valuation purposes based on similar historical exercise behavior. Expected stock price volatility is based on the daily movement of the company's common stock over the most recent historical period equivalent to the expected life of the option. The risk-free interest rate for periods within the contractual life of the option is based on the U.S. Treasury rate over the expected life at the time of grant. The expected dividend yield is estimated over the expected life based on the company's historical cash dividends paid, expected future cash dividends and dividend yield, and estimated changes in the company's stock price. The table below illustrates the weighted-average valuation assumptions for options granted in the following fiscal periods: Fiscal Years Ended October 31 2020 2019 2018 Expected life of option in years 6.31 6.31 6.04 Expected stock price volatility 19.53 % 19.83 % 20.58 % Risk-free interest rate 1.73 % 2.77 % 2.21 % Expected dividend yield 0.99 % 1.18 % 0.97 % Per share weighted-average fair value at date of grant $ 15.23 $ 12.83 $ 14.25 The table below presents stock option activity for fiscal 2020: Stock Option Awards Weighted-Average Exercise Price Weighted-Average Aggregate Intrinsic Outstanding as of October 31, 2019 2,848,120 $ 44.34 5.7 $ 93,392 Granted 536,890 76.07 Exercised (734,398) 31.10 Forfeited (4,009) 75.23 Outstanding as of October 31, 2020 2,646,603 $ 54.40 6.2 $ 73,305 Exercisable as of October 31, 2020 1,609,770 $ 45.22 4.8 $ 59,364 As of October 31, 2020, there was $2.8 million of total unrecognized compensation cost related to unvested stock options. That cost is expected to be recognized over a weighted-average period of 1.75 years. The table below presents the total market value of stock options exercised and the total intrinsic value of options exercised during the following fiscal years (in thousands): Fiscal Years Ended October 31 2020 2019 2018 Market value of stock options exercised $ 56,761 $ 92,352 $ 70,775 Intrinsic value of stock options exercised 1 $ 33,920 $ 62,288 $ 53,778 1 Intrinsic value is calculated as the amount by which the stock price at exercise date exceeded the option exercise price. Performance Share Awards Under the 2010 plan, the company grants performance share awards to executive officers and other employees under which they are entitled to receive shares of the company's common stock contingent on the achievement of performance goals of the company, which are generally measured over a three-year period. The number of shares of common stock a participant receives can be increased (up to 200.0 percent of target levels) or reduced (down to zero) based on the level of achievement of performance goals and will vest at the end of a three-year period. Performance share awards are generally granted on an annual basis in the first quarter of the company's fiscal year. Compensation cost is recognized for these awards on a straight-line basis over the vesting period based on the per share fair value, which is equal to the closing price of the company's common stock on the date of grant, and the probability of achieving each performance goal. Factors related to the company's performance share awards are as follows (in thousands, except per award data): Fiscal Years Ended October 31 2020 2019 2018 Weighted-average fair value per award at date of grant $ 77.33 $ 59.58 $ 65.40 Fair value of performance share awards vested $ 6,271 $ 6,300 $ 8,419 The table below presents fiscal 2020 activity for unvested performance share awards: Performance Shares Weighted-Average Fair Value at Date of Grant Unvested as of October 31, 2019 192,854 $ 59.47 Granted 81,655 77.33 Vested (82,782) 54.52 Forfeited (4,306) 61.27 Unvested as of October 31, 2020 187,421 $ 67.58 As of October 31, 2020, there was $3.4 million of total unrecognized compensation cost related to unvested performance share awards. That cost is expected to be recognized over a weighted-average period of 1.75 years. Restricted Stock Unit Awards Under the 2010 plan, restricted stock unit awards are generally granted to certain employees that are not executive officers. Occasionally, restricted stock unit awards may be granted, including to executive officers, in connection with hiring, mid-year promotions, leadership transition, or retention. Restricted stock unit awards generally vest one-third each year over a three-year period, or vest in full on the three-year anniversary of the date of grant. Such awards may have performance-based rather than time-based vesting requirements. Compensation cost equal to the grant date fair value, net of estimated forfeitures, is recognized for these awards over the vesting period. The grant date fair value is equal to the closing price of the company's common stock on the date of grant multiplied by the number of shares subject to the restricted stock unit awards and estimated forfeitures are determined on the grant date based on historical forfeiture experience. Factors related to the company's restricted stock unit awards are as follows (in thousands, except per award data): Fiscal Years Ended October 31 2020 2019 2018 Weighted-average fair value per award at date of grant $ 74.55 $ 66.26 $ 63.24 Fair value of restricted stock units vested $ 3,410 $ 3,083 $ 4,888 The table below presents fiscal 2020 activity for unvested restricted stock units: Restricted Stock Units Weighted-Average Fair Value at Date Unvested as of October 31, 2019 124,467 $ 65.30 Granted 27,161 74.55 Vested (48,212) 64.97 Forfeited (3,136) 70.40 Unvested as of October 31, 2020 100,280 $ 67.69 As of October 31, 2020, there was $3.0 million of total unrecognized compensation cost related to unvested restricted stock units. That cost is expected to be recognized over a weighted-average period of 1.76 years. Deferred Compensation Plan The company maintains a deferred compensation plan that allows executive officers and other employees that receive performance share awards under the 2010 plan to defer receipt of shares of the company's common stock paid out under such awards to a date in the future. Participants can defer up to 100.0 percent of the common stock payout and are always 100.0 percent vested in their accounts. Common stock payout deferrals under this plan are held in a rabbi trust and treated in a manner similar to treasury shares and are recorded at cost within stockholders' equity in the Consolidated Balance Sheets as of October 31, 2020 and 2019. The total of common stock required to settle this deferred compensation obligation is included in the denominator in both basic and diluted earnings per share calculations. |
Stockholders' Equity
Stockholders' Equity | 12 Months Ended |
Oct. 31, 2020 | |
Stockholders' Equity Note [Abstract] | |
Stockholders' Equity | 11 Stockholders' Equity Stock Repurchase Program On December 3, 2015, the company's Board authorized the repurchase of 8,000,000 shares of the company's common stock in open-market or in privately negotiated transactions. On December 4, 2018, the company's Board authorized the repurchase of up to an additional 5,000,000 shares of common stock in open-market or in privately negotiated transactions under the authorized stock repurchase program. This authorized stock repurchase program has no expiration date but may be terminated by the Board at any time. No shares were repurchased under the authorized stock repurchase program during fiscal 2020. The company curtailed the repurchase of shares of its common stock during fiscal 2020 as a result of the Venture Products transaction and to enhance its liquidity position in response to COVID-19. During fiscal 2019 and 2018, the company paid $20.0 million and $160.4 million to repurchase an aggregate of 359,758 shares and 2,579,864 shares, respectively, under the authorized stock repurchase program. As a result of the CMW transaction, the company curtailed the repurchase of shares of its common stock under the authorized stock repurchase program during the company's fiscal 2019 second, third, and fourth quarters. As of October 31, 2020, 7,042,256 shares remained authorized by the company's Board for repurchase. The authorized stock repurchase program does not include shares of the company's common stock surrendered by employees to satisfy minimum tax withholding obligations upon vesting of certain stock-based compensation awards granted under the company's 2010 plan. Treasury Shares Treasury shares generally consist of shares of the company's common stock repurchased under the company's Board authorized stock repurchase program. The company values treasury shares on an average cost basis. As of October 31, 2020, the company had a total of 20,545,330 treasury shares at an average cost of $1,323.2 million. As of October 31, 2019, the company had a total of 21,385,919 treasury shares at an average cost of $1,374.0 million. Accumulated Other Comprehensive Loss The components of AOCL, net of tax, within the Consolidated Statements of Stockholders' Equity were as follows (in thousands): As of October 31 2020 2019 2018 Foreign currency translation adjustments $ 24,508 $ 31,025 $ 29,711 Pension and post-retirement benefits 5,106 4,861 561 Cash flow derivative instruments 4,648 (3,837) (6,335) Total accumulated other comprehensive loss $ 34,262 $ 32,049 $ 23,937 The components and activity of AOCL, net of tax, were as follows (in thousands): Foreign Currency Translation Adjustments Pension Benefits Cash Flow Derivative Instruments Total Balance as of October 31, 2019 $ 31,025 $ 4,861 $ (3,837) $ 32,049 Other comprehensive (income) loss before reclassifications (6,517) 245 14,159 7,887 Amounts reclassified from AOCL — — (5,674) (5,674) Net current period other comprehensive (income) loss (6,517) 245 8,485 2,213 Balance as of October 31, 2020 $ 24,508 $ 5,106 $ 4,648 $ 34,262 Foreign Currency Translation Adjustments Pension and Post-Retirement Benefits Cash Flow Derivative Instruments Total Balance as of October 31, 2018 $ 29,711 $ 561 $ (6,335) $ 23,937 Other comprehensive (income) loss before reclassifications 1,314 4,300 (4,048) 1,566 Amounts reclassified from AOCL — — 6,546 6,546 Net current period other comprehensive loss 1,314 4,300 2,498 8,112 Balance as of October 31, 2019 $ 31,025 $ 4,861 $ (3,837) $ 32,049 For additional information on the components reclassified from AOCL to the respective line items in net earnings for derivative instruments refer to Note 14, Derivative Instruments and Hedging Activities . |
Commitments and Contingencies
Commitments and Contingencies | 12 Months Ended |
Oct. 31, 2020 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | 12 Commitments and Contingencies Customer Financing Arrangements Wholesale Financing The company is party to a joint venture with TCFIF, established as Red Iron, to provide wholesale financing to certain dealers and distributors of certain of the company's products. Refer to Note 8, Investment in Joint Venture, for additional information related to Red Iron. Financing agreements are also in place with separate third-party financial institutions to provide financing to certain dealers not financed through Red Iron, including third-party financial institutions in the U.S. and internationally in Australia. These third-party financial institutions financed $410.7 million and $235.4 million of receivables for certain dealers and distributors during the fiscal years ended October 31, 2020 and 2019, respectively. As of October 31, 2020 and October 31, 2019, $137.6 million and $148.4 million of receivables financed by these third-party financing institutions, excluding Red Iron, respectively, were outstanding. Additionally, as a result of the company's financing agreements with the separate third-party financial institutions, the company also entered into inventory repurchase agreements with the separate third-party financial institutions. Under such inventory repurchase agreements, the company has agreed to repurchase products repossessed by the separate third-party financial institutions. For the fiscal years ended October 31, 2020 and 2019, the company was contingently liable to repurchase up to a maximum amount of $128.1 million and $125.9 million, respectively, of inventory related to receivables under these inventory repurchase agreements. The company's financial exposure under these inventory repurchase agreements is limited to the difference between the amount paid to the separate third-party financial institutions for repurchases of inventory and the amount received upon subsequent resale of the repossessed product. The company has repurchased immaterial amounts of inventory under these repurchase agreements for the fiscal years ended October 31, 2020, 2019, and 2018. End-User Financing The company has agreements with third-party financing companies to provide financing options to end-customers throughout the world. The company has no material contingent liabilities for residual value or credit collection risk under these agreements with third-party financing companies. From time to time, the company enters into agreements where it provides recourse to third-party finance companies in the event of default by the customer for financing payments to the third-party finance company. The company's maximum exposure for credit collection for the fiscal years ended October 31, 2020 and 2019 was $12.5 million and $10.1 million, respectively. Purchase Commitments As of October 31, 2020, the company had $33.4 million of noncancelable purchase commitments with certain of the company's suppliers for commodities, components, and supplies as part of the normal course of business. As of October 31, 2020, the company did not have any material noncancelable purchase commitments related to capital expenditures for renovation and expansion efforts at the company's facilities. Letters of Credit The company has access to a revolving credit facility that, among other things, includes a $10.0 million sublimit for standby letters of credit. As of October 31, 2020 and October 31, 2019, the company had $2.5 million and $1.9 million outstanding under the sublimit for standby letters of credit, respectively. Refer to Note 6, Indebtedness , for additional information related to the company's revolving credit facility. The company's domestic and non-U.S. operations maintain credit lines for import letters of credit during the normal course of business, as required by some vendor contracts. Collectively, these import letters of credit had a maximum availability of $13.4 million and $13.3 million as of October 31, 2020 and October 31, 2019, respectively. For the fiscal years ended October 31, 2020 and 2019, the company had $3.9 million and $4.7 million, respectively, in outstanding import letters of credit. Litigation The company is party to litigation in the ordinary course of business. Such matters are generally subject to uncertainties and to outcomes that are not predictable with assurance and that may not be known for extended periods of time. Litigation occasionally involves claims for punitive, as well as compensatory, damages arising out of the use of the company's products. Although the company is self-insured to some extent, the company maintains insurance against certain product liability losses. The company is also subject to litigation and administrative and judicial proceedings with respect to claims involving asbestos and the discharge of hazardous substances into the environment. Some of these claims assert damages and liability for personal injury, remedial investigations or clean-up and other costs and damages. The company is also typically involved in commercial disputes, employment disputes, and patent litigation cases in which it is asserting or defending against patent infringement claims. To prevent possible infringement of the company's patents by others, the company periodically reviews competitors' products. To avoid potential liability with respect to others' patents, the company reviews certain patents issued by the U.S. Patent and Trademark Office and foreign patent offices. The company believes these activities help minimize its risk of being a defendant in patent infringement litigation. The company is currently involved in patent litigation cases, including cases by or against competitors, where it is asserting and defending against claims of patent infringement. Such cases are at varying stages in the litigation process. The company records a liability in its Consolidated Financial Statements for costs related to claims, including future legal costs, settlements, and judgments, where the company has assessed that a loss is probable and an amount can be reasonably estimated. If the reasonable estimate of a probable loss is a range, the company records the most probable estimate of the loss or the minimum amount when no amount within the range is a better estimate than any other amount. |
Leases
Leases | 12 Months Ended |
Oct. 31, 2020 | |
Leases [Abstract] | |
Leases | 13 Leases The company enters into contracts that are, or contain, operating lease agreements for certain property, plant, or equipment assets utilized in the normal course of business, such as buildings for manufacturing facilities, office space, distribution centers, and warehouse facilities; land for product testing sites; machinery and equipment for research and development activities, manufacturing and assembly processes, and administrative tasks; and vehicles for sales, service, marketing, and distribution activities. Contracts that explicitly or implicitly relate to property, plant, and equipment are assessed at inception to determine if the contract is, or contains, a lease. Such contracts for operating lease agreements convey the company's right to direct the use of, and obtain substantially all of the economic benefits from, an identified asset for a defined period of time in exchange for consideration. The lease term begins and is determined upon lease commencement, which is the point in time when the company takes possession of the identified asset, and includes all non-cancelable periods. The lease term may also include options to extend or terminate the lease when it is reasonably certain that such options will be exercised after considering all relevant economic and financial factors. Options to extend or terminate a lease are generally exercisable at the company's sole discretion, subject to any required minimum notification period and/or other contractual terms as defined within the respective lease agreement, as applicable. The company's renewal options generally range from extended terms of two asset underlying the respective operating lease arrangement. The company does not recognize right-of-use assets and lease liabilities, but does recognize expense on a straight-line basis, for short-term operating leases which have a lease term of 12 months or less and do not include an option to purchase the underlying asset. Lease payments are determined at lease commencement and represent fixed lease payments as defined within the respective lease agreement or, in the case of certain lease agreements, variable lease payments that are measured as of the lease commencement date based on the prevailing index or market rate. Future adjustments to variable lease payments are defined and scheduled within the respective lease agreement and are determined based upon the prevailing market or index rate at the time of the adjustment relative to the market or index rate determined at lease commencement. Certain other lease agreements contain variable lease payments that are determined based upon actual utilization of the identified asset. Such future adjustments to variable lease payments and variable lease payments based upon actual utilization of the identified asset are not included within the determination of lease payments at commencement but rather, are recorded as variable lease expense in the period in which the variable lease cost is incurred. Additionally, the company's operating leases generally do not include material residual value guarantees. The company has operating leases with both lease components and non-lease components. For all underlying asset classes, the company accounts for lease components separately from non-lease components based on the relative market value of each component. Non-lease components typically consist of common area maintenance, utilities, and/or other repairs and maintenance services. The costs related to non-lease components are not included within the determination of lease payments at commencement. Right-of-use assets represent the company's right to use an underlying asset throughout the lease term and lease liabilities represent the company's obligation to make lease payments arising from the lease agreement. The company accounts for operating lease liabilities at lease commencement and on an ongoing basis as the present value of the minimum remaining lease payments under the respective lease term. Minimum remaining lease payments are discounted to present value based on the rate implicit in the operating lease agreement or the estimated incremental borrowing rate at lease commencement if the rate implicit in the lease is not readily determinable. Generally, the estimated incremental borrowing rate is used as the rate implicit in the lease is not readily determinable. The estimated incremental borrowing rate represents the rate of interest that the company would have to pay to borrow on a general and unsecured collateralized basis over a similar term, an amount equal to the lease payments in a similar economic environment. The company determines the estimated incremental borrowing rate at lease commencement based on available information at such time, including lease term, lease currency, and geographical market. Right-of-use assets are measured as the amount of the corresponding operating lease liability for the respective operating lease agreement, adjusted for prepaid or accrued lease payments, the remaining balance of any lease incentives received, unamortized initial direct costs, and impairment of the operating lease right-of-use asset, as applicable. The following table presents the lease expense incurred on the company’s operating, short-term, and variable leases (in thousands): Fiscal Year Ended October 31 2020 Operating lease expense $ 19,637 Short-term lease expense 2,949 Variable lease expense 134 Total lease expense $ 22,720 The following table presents supplemental cash flow information related to the company's operating leases (in thousands): Fiscal Year Ended October 31 2020 Operating cash flows for amounts included in the measurement of lease liabilities $ 17,762 Right-of-use assets obtained in exchange for lease obligations $ 22,667 The following table presents other lease information related to the company's operating leases as of October 31, 2020: October 31, 2020 Weighted-average remaining lease term of operating leases in years 7.1 Weighted-average discount rate of operating leases 2.79 % The following table reconciles the total undiscounted future cash flows based on the anticipated future minimum operating lease payments by fiscal year for the company's operating leases to the present value of operating lease liabilities recorded within the Consolidated Balance Sheets as of October 31, 2020 (in thousands): October 31, 2020 2021 $ 18,077 2022 15,391 2023 12,293 2024 10,936 2025 9,919 Thereafter 23,604 Total future minimum operating lease payments 90,220 Less: imputed interest 8,132 Present value of operating lease liabilities $ 82,088 The following table presents future minimum operating lease payments by respective fiscal year for non-cancelable operating leases under the legacy lease accounting guidance at ASC Topic 840, Leases , as of October 31, 2019 (in thousands): October 31, 2019 2020 $ 17,135 2021 15,764 2022 12,806 2023 9,772 2024 8,863 Thereafter 18,732 Total future minimum lease payments $ 83,072 Total lease expense related to the company's operating leases under the legacy lease accounting guidance was $34.1 million and $27.4 million for the fiscal years ended October 31, 2019 and 2018, respectively. |
Derivative Instruments and Hedg
Derivative Instruments and Hedging Activities | 12 Months Ended |
Oct. 31, 2020 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Derivative Instruments and Hedging Activities | 14 Derivative Instruments and Hedging Activities Risk Management Objective of Using Derivatives The company is exposed to foreign currency exchange rate risk arising from transactions in the normal course of business, such as sales to third-party customers, sales and loans to wholly owned foreign subsidiaries, costs associated with foreign plant operations, and purchases from suppliers. The company’s primary currency exchange rate exposures are with the Euro, the Australian dollar, the Canadian dollar, the British pound, the Mexican peso, the Japanese yen, the Chinese Renminbi, and the Romanian New Leu against the U.S. dollar, as well as the Romanian New Leu against the Euro. To reduce its exposure to foreign currency exchange rate risk, the company actively manages the exposure of its foreign currency exchange rate risk by entering into various derivative instruments to hedge against such risk, authorized under a company policy that places controls on these hedging activities, with counterparties that are highly rated financial institutions. The company’s policy does not allow the use of derivative instruments for trading or speculative purposes. The company has also made an accounting policy election to use the portfolio exception with respect to measuring counterparty credit risk for derivative instruments, and to measure the fair value of a portfolio of financial assets and financial liabilities on the basis of the net open risk position with each counterparty. The company’s hedging activities primarily involve the use of forward currency contracts to hedge most foreign currency transactions, including forecasted sales and purchases denominated in foreign currencies. The company uses derivative instruments only in an attempt to limit underlying exposure from foreign currency exchange rate fluctuations and to minimize earnings and cash flow volatility associated with foreign currency exchange rate fluctuations. Decisions on whether to use such derivative instruments are primarily based on the amount of exposure to the currency involved and an assessment of the near-term market value for each currency. The company recognizes all derivative instruments at fair value on the Consolidated Balance Sheets as either assets or liabilities. The accounting for changes in the fair value of a derivative instrument depends on whether it has been designated and qualifies as a cash flow hedging instrument. Cash Flow Hedging Instruments The company formally documents relationships between cash flow hedging instruments and the related hedged transactions, as well as its risk-management objective and strategy for undertaking cash flow hedging instruments. This process includes linking all cash flow hedging instruments to the forecasted transactions, such as sales to third-parties and costs associated with foreign plant operations, including purchases from suppliers. At the cash flow hedge’s inception and on an ongoing basis, the company formally assesses whether the cash flow hedging instruments have been highly effective in offsetting changes in the cash flows of the hedged transactions and whether those cash flow hedging instruments may be expected to remain highly effective in future periods. Changes in the fair values of the spot rate component of outstanding, highly effective cash flow hedging instruments included in the assessment of hedge effectiveness are recorded in other comprehensive income within AOCL on the Consolidated Balance Sheets and are subsequently reclassified to net earnings within the Consolidated Statements of Earnings during the same period in which the cash flows of the underlying hedged transaction affect net earnings. Changes in the fair values of hedge components excluded from the assessment of effectiveness are recognized immediately in net earnings under the mark-to-market approach. The classification of gains or losses recognized on cash flow hedging instruments and excluded components within the Consolidated Statements of Earnings is the same as that of the underlying exposure. Results of cash flow hedging instruments, and the related excluded components, of sales and costs associated with foreign plant operations, including purchases from suppliers, are recorded in net sales and cost of sales, respectively. The maximum amount of time the company hedges its exposure to the variability in future cash flows for forecasted trade sales and purchases is two years. When it is determined that a derivative instrument is not, or has ceased to be, highly effective as a cash flow hedge, the company discontinues cash flow hedge accounting prospectively. The gain or loss on the dedesignated derivative instrument remains in AOCL and is reclassified to net earnings within the same Consolidated Statements of Earnings line item as the underlying exposure when the forecasted transaction affects net earnings. When the company discontinues cash flow hedge accounting because it is no longer probable, but it is still reasonably possible that the forecasted transaction will occur by the end of the originally expected period or within an additional two-month period of time thereafter, the gain or loss on the derivative instrument remains in AOCL and is reclassified to net earnings within the same Consolidated Statements of Earnings line item as the underlying exposure when the forecasted transaction affects net earnings. However, if it is probable that a forecasted transaction will not occur by the end of the originally specified time period or within an additional two-month period of time thereafter, the gains and losses that were in AOCL are immediately recognized in net earnings within other income, net in the Consolidated Statements of Earnings. In all situations in which cash flow hedge accounting is discontinued and the derivative instrument remains outstanding, the company carries the derivative instrument at its fair value on the Consolidated Balance Sheets, recognizing future changes in the fair value within other income, net in the Consolidated Statements of Earnings. As of October 31, 2020, the notional amount outstanding of forward currency contracts designated as cash flow hedging instruments was $259.6 million. Derivatives Not Designated as Cash Flow Hedging Instruments The company also enters into foreign currency contracts that include forward currency contracts to mitigate the remeasurement of specific assets and liabilities on the Consolidated Balance Sheets. These contracts are not designated as cash flow hedging instruments. Accordingly, changes in the fair value of hedges of recorded balance sheet positions, such as cash, receivables, payables, intercompany notes, and other various contractual claims to pay or receive foreign currencies other than the functional currency, are recognized immediately in other income, net, on the Consolidated Statements of Earnings together with the transaction gain or loss from the hedged balance sheet position. The following table presents the fair value and location of the company’s derivative instruments on the Consolidated Balance Sheets (in thousands): Fair Value as of October 31 2020 2019 Derivative assets: Derivatives designated as cash flow hedging instruments: Prepaid expenses and other current assets Forward currency contracts $ 802 $ 8,642 Derivatives not designated as cash flow hedging instruments: Prepaid expenses and other current assets Forward currency contracts 131 2,256 Total assets $ 933 $ 10,898 Derivative liabilities: Derivatives designated as cash flow hedging instruments: Accrued liabilities Forward currency contracts $ 2,687 $ — Derivatives not designated as cash flow hedging instruments: Accrued liabilities Forward currency contracts (203) 9 Total liabilities $ 2,484 $ 9 The company entered into an International Swap Dealers Association ("ISDA") Master Agreement with each counterparty that permits the net settlement of amounts owed under their respective contracts. The ISDA Master Agreement is an industry standardized contract that governs all derivative contracts entered into between the company and the respective counterparty. Under these master netting agreements, net settlement generally permits the company or the counterparty to determine the net amount payable or receivable for contracts due on the same date or in the same currency for similar types of derivative transactions. The company records the fair value of its derivative instruments at the net amount on its Consolidated Balance Sheets. The following table presents the effects of the master netting arrangements on the fair value of the company’s derivative instruments that are recorded on the Consolidated Balance Sheets (in thousands): Fair Value as of October 31 2020 2019 Derivative assets: Forward currency contracts: Gross amounts of recognized assets $ 1,139 $ 11,056 Gross liabilities offset in the Consolidated Balance Sheets (206) (158) Net amounts of assets presented in the Consolidated Balance Sheets $ 933 $ 10,898 Derivative liabilities: Forward currency contracts: Gross amounts of recognized liabilities $ (3,233) $ (9) Gross assets offset in the Consolidated Balance Sheets 749 — Net amounts of liabilities presented in the Consolidated Balance Sheets $ (2,484) $ (9) The following table presents the impact and location of the amounts reclassified from AOCL into net earnings on the Consolidated Statements of Earnings and the impact of derivative instruments on the Consolidated Statements of Comprehensive Income for the company's derivatives designated as cash flow hedging instruments (in thousands): Gain Reclassified from AOCL into Income (Loss) Recognized in OCI on Derivatives Fiscal Years Ended October 31 2020 2019 2020 2019 Derivatives designated as cash flow hedging instruments: Forward currency contracts: Net sales $ 5,023 $ 5,732 $ (8,232) $ (2,268) Cost of sales 651 814 (253) (230) Total derivatives designated as cash flow hedging instruments $ 5,674 $ 6,546 $ (8,485) $ (2,498) The company recognized immaterial gains within other income, net on the Consolidated Statement of Earnings during fiscal 2020 due to the discontinuance of cash flow hedge accounting on certain forward currency contracts designated as cash flow hedging instruments. During fiscal 2019, the company did not discontinue cash flow hedge accounting on any forward currency contracts designated as cash flow hedging instruments. As of October 31, 2020, the company expects to reclassify approximately $3.3 million of losses from AOCL to earnings during the next twelve months. The following tables present the impact and location of derivative instruments on the Consolidated Statements of Earnings for the company’s derivatives designated as cash flow hedging instruments and the related components excluded from hedge effectiveness testing (in thousands): Gain Recognized in Earnings on Cash Flow Hedging Instruments Fiscal Year Ended October 31, 2020 Net Sales Cost of Sales Total Consolidated Statements of Earnings income (expense) amounts in which the effects of cash flow hedging instruments are recorded $ 3,378,810 $ (2,189,036) Gain on derivatives designated as cash flow hedging instruments: Forward currency contracts: Amount of gain reclassified from AOCL into earnings 5,023 651 Gain on components excluded from effectiveness testing recognized in earnings based on changes in fair value $ 3,229 $ 313 Gain Recognized in Earnings on Cash Flow Hedging Instruments Fiscal Year Ended October 31, 2019 Net Sales Cost of Sales Total Consolidated Statements of Earnings income (expense) amounts in which the effects of cash flow hedging instruments are recorded $ 3,138,084 $ (2,090,121) Gain on derivatives designated as cash flow hedging instruments: Forward currency contracts: Amount of gain reclassified from AOCL into earnings 5,732 814 Gain on components excluded from effectiveness testing recognized in earnings based on changes in fair value $ 5,358 $ 135 The following table presents the impact and location of derivative instruments on the Consolidated Statements of Earnings for the company’s derivatives not designated as cash flow hedging instruments (in thousands): Fiscal Years Ended October 31 2020 2019 Loss on derivative instruments not designated as cash flow hedging instruments: Forward currency contracts: Other income, net $ (5,792) $ (2,087) Total loss on derivatives not designated as cash flow hedging instruments $ (5,792) $ (2,087) |
Fair Value Measurements
Fair Value Measurements | 12 Months Ended |
Oct. 31, 2020 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | 15 Fair Value Measurements The company categorizes its assets and liabilities into one of three levels based on the assumptions (inputs) used in valuing the asset or liability. Estimates of fair value for financial assets and financial liabilities are based on the framework established in the accounting guidance for fair value measurements. The framework defines fair value, provides guidance for measuring fair value, and requires certain disclosures. The framework discusses valuation techniques such as the market approach (comparable market prices), the income approach (present value of future income or cash flows), and the cost approach (cost to replace the service capacity of an asset or replacement cost). The framework utilizes a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value into three broad levels. Level 1 provides the most reliable measure of fair value, while Level 3 generally requires significant management judgment. The three levels are defined as follows: Level 1: Unadjusted quoted prices in active markets for identical assets or liabilities. Level 2: Observable inputs other than Level 1 prices, such as quoted prices for similar assets or liabilities in active markets; quoted prices for identical assets or liabilities in markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities. Level 3: Unobservable inputs reflecting management's assumptions about the inputs used in pricing the asset or liability. Recurring Fair Value Measurements The company's derivative instruments consist of forward currency contracts that are measured at fair value on a recurring basis. The fair value of such forward currency contracts is determined based on observable market transactions of forward currency prices and spot currency rates as of the reporting date. There were no transfers between the levels of the fair value hierarchy during the fiscal years ended October 31, 2020 and 2019. The following tables present, by level within the fair value hierarchy, the company's financial assets and liabilities that are measured at fair value on a recurring basis as of October 31, 2020 and 2019, according to the valuation technique utilized to determine their fair values (in thousands): Fair Value Measurements Using Inputs Considered as: October 31, 2020 Fair Value Level 1 Level 2 Level 3 Assets: Forward currency contracts $ 933 $ — $ 933 $ — Total assets $ 933 $ — $ 933 $ — Liabilities: Forward currency contracts $ 2,484 $ — $ 2,484 $ — Total liabilities $ 2,484 $ — $ 2,484 $ — Fair Value Measurements Using Inputs Considered as: October 31, 2019 Fair Value Level 1 Level 2 Level 3 Assets: Forward currency contracts $ 10,898 $ — $ 10,898 $ — Total assets $ 10,898 $ — $ 10,898 $ — Liabilities: Forward currency contracts $ 9 $ — $ 9 $ — Total liabilities $ 9 $ — $ 9 $ — Nonrecurring Fair Value Measurements The company measures certain assets and liabilities at fair value on a non-recurring basis. Assets and liabilities that are measured at fair value on a nonrecurring basis include long-lived assets, goodwill, and indefinite-lived intangible assets, which would generally be recorded at fair value as a result of an impairment charge. Assets acquired and liabilities assumed as part of a business combination are also measured at fair value on a non-recurring basis during the measurement period allowed by the accounting standards codification guidance for business combinations, when applicable. For additional information on the company's business combinations and the related non-recurring fair value measurement of the assets acquired and liabilities assumed, refer to Note 2, Business Combinations . Other Fair Value Disclosures The carrying values of the company's short-term financial instruments, including cash and cash equivalents, accounts receivable, accounts payable, and short-term debt, including current maturities of long-term debt, when applicable, approximate their fair values due to their short-term nature. As of October 31, 2020 and 2019, the company's long-term debt included $424.0 million and $423.9 million, respectively, of gross fixed-rate debt that is not subject to variable interest rate fluctuations. The estimated gross fair value of such long-term debt is determined using Level 2 inputs by discounting the projected cash flows of the company's gross fixed rate debt using the current interest rate that could be obtained for similar amounts of debt and a similar financing term. As of October 31, 2020, the estimated gross fair value of long-term debt with fixed interest rates was $508.2 million compared to its carrying amount of $424.0 million. As of October 31, 2019, the estimated gross fair value of long-term debt with fixed interest rates was $493.8 million compared to its carrying amount of $423.9 million. For additional information regarding long-term debt with fixed interest rates, refer to Note 6, Indebtedness . |
Employee Retirement Plans
Employee Retirement Plans | 12 Months Ended |
Oct. 31, 2020 | |
Retirement Benefits [Abstract] | |
Employee Retirement Plans | 16 Employee Retirement Plans Defined Contribution Plan The company maintains The Toro Company Retirement Plan for eligible employees. Prior to a plan amendment that was effective as of January 1, 2020, this plan was named The Toro Company Investment, Savings and Employee Stock Ownership Plan. The company's expenses under this plan, which include costs related to matching contributions and discretionary retirement fund contributions, as applicable, were $17.4 million, $23.4 million, and $18.8 million for the fiscal years ended October 31, 2020, 2019, and 2018, respectively. The decrease in expense for the fiscal year ended October 31, 2020, as compared to the fiscal year ended October 31, 2019, was primarily the result of the company's suspension of discretionary retirement fund contributions for fiscal 2020 as a proactive cost reduction measure to mitigate the anticipated adverse impacts of COVID-19. Defined Benefit Plans The company has a defined benefit pension plan covering certain employees in the United Kingdom. The company was also previously a sponsor to another defined benefit pension plan for certain employees in the U.S. (collectively, the "defined benefit retirement plans"). This defined benefit pension plan for certain employees in the U.S. has been terminated as of October 31, 2020 and all accumulated benefit obligations of the company related to such plan have been satisfied. The projected and accumulated benefit obligation of the defined benefit retirement plans were $33.4 million and $39.5 million as of October 31, 2020 and 2019, respectively. The fair value of the defined benefit retirement plans assets as of October 31, 2020 and 2019 was $29.5 million and $38.0 million, respectively. The net funded status of the defined benefit retirement plans as of October 31, 2020 and 2019 was underfunded at $3.9 million and $1.5 million, respectively. Amounts recognized in AOCL, net of tax, were $5.1 million and $4.9 million as of October 31, 2020 and 2019, respectively. Service costs of the defined benefit retirement plans are presented in selling, general and administrative expense within the Consolidated Statements of Earnings. Non-service cost components of net periodic benefit cost (income), including realized gains or losses as a result of changes in actuarial valuation assumptions, are presented in other income, net within the Consolidated Statements of Earnings. The company recognized income of $0.2 million and $6.6 million for the fiscal years ended October 31, 2020 and 2019, respectively, and recognized expense of $0.2 million for the fiscal year ended October 31, 2018, within the Consolidated Statements of Earnings for the defined benefit retirement plans. The company has omitted the remaining disclosures for the defined benefit retirement plans as the company deems these defined benefit retirement plans to be immaterial to its Consolidated Financial Statements. |
Other Income, Net
Other Income, Net | 12 Months Ended |
Oct. 31, 2020 | |
Other Income and Expenses [Abstract] | |
Other Income, Net | 17 Other Income, Net The components of other income, net were as follows (in thousands): Fiscal Years Ended October 31 2020 2019 2018 Interest income $ 1,255 $ 2,753 $ 2,463 Retail financing revenue 1,080 1,178 1,232 Foreign currency exchange rate gain 2,034 1,558 1,127 Non-cash income from finance affiliate 7,663 11,948 11,143 Net periodic benefit income (loss) on defined benefit pension and post-retirement plans (1,344) 6,822 — Miscellaneous 3,181 1,680 2,443 Total other income, net $ 13,869 $ 25,939 $ 18,408 |
Subsequent Events
Subsequent Events | 12 Months Ended |
Oct. 31, 2020 | |
Subsequent Events [Abstract] | |
Subsequent Events | 18 Subsequent Events Litigation Settlement On November 19, 2020, Exmark Manufacturing Company Incorporated ("Exmark"), a wholly owned-subsidiary of the company, and Briggs & Stratton Corporation (“BGG”) entered into a settlement agreement (“Settlement Agreement”) relating to the decade-long patent infringement litigation that Exmark originally filed in May 2010 against Briggs & Stratton Power Products Group, LLC (“BSPPG”), a former wholly-owned subsidiary of BGG (Case No. 8:10CV187, U.S. District Court for the District of Nebraska) (the “Infringement Action”). In the Infringement Action, Exmark alleged that certain mower decks manufactured by BSPPG infringed an Exmark mower deck patent. The Infringement Action was repeatedly decided in favor of Exmark, which BGG continued to appeal. However, recent actions by BGG potentially put in jeopardy the certainty and timing of the eventual receipt of the damages awarded to Exmark in the Infringement Action, including (i) the filing by BGG and certain of its subsidiaries for bankruptcy relief under chapter 11 of title 11 of the United States Code (“BGG Bankruptcy”); (ii) the sale of substantially all the assets (but not certain liabilities, including the Infringement Action) of BGG and its subsidiaries to a third-party pursuant to Section 363 of the United States Code; and (iii) a petition filed by BGG for a panel rehearing of the Federal Circuit's decision in the Infringement Action (“Rehearing Petition”). As a result, on November 19, 2020, Exmark entered into the Settlement Agreement with BGG which provides, among other things, that (i) upon approval by the bankruptcy court, and such approval becoming final and nonappealable, BGG agreed to pay Exmark $33.65 million (“Settlement Amount”), (ii) BGG agreed to immediately withdraw the Rehearing Petition and otherwise not pursue additional appellate review regarding the Infringement Action, and (iii) after receipt of the Settlement Amount, Exmark agreed to release a supersedeas appeal bond that had been obtained by BGG to support payment of the damages award to Exmark in the Infringement Action. On November 20, 2020, BGG filed a motion to withdraw the Rehearing Petition and on December 16, 2020, the bankruptcy court approved the Settlement Agreement (“Bankruptcy Approval”). As of the time of the filing of this Annual Report on Form 10-K, the Bankruptcy Approval has not yet become final and nonappealable. Upon the Bankruptcy Approval becoming final and nonappealable, the Settlement Amount will be due to Exmark. The final amount to be received by Exmark in connection with the settlement of the Infringement Action, however, will be reduced by an amount of up to 50.0 percent of the Settlement Amount pursuant to a contingent fee arrangement with the company’s external legal counsel that is customary in patent infringement cases. Although the company was previously awarded damages in the Infringement Action, due to the status of the Infringement Action proceedings as of October 31, 2020, no amounts were recorded within the company's Consolidated Financial Statements included in this Annual Report on Form 10-K related to this gain contingency as the company could provide no assurance as to the timing or eventual receipt of the awarded damages as of that time. In addition, as the Bankruptcy Approval is outstanding and the obligation under the contingent fee arrangement is dependent upon the receipt of the Settlement Amount by Exmark, and the timing and certainty of each event remains uncertain, the company has not recorded any amount in its Consolidated Financial Statements related to the loss contingency associated with the contingent fee arrangement as of October 31, 2020. The company expects that the earliest the Bankruptcy Approval will become final and nonappealable, and therefore, the Settlement Amount will become due to Exmark is during the company's fiscal 2021 first quarter. The company has evaluated all additional subsequent events and concluded that no additional subsequent events have occurred that would require recognition in the Consolidated Financial Statements or disclosure in the Notes to the Consolidated Financial Statements. |
Quarterly Financial Data (Unaud
Quarterly Financial Data (Unaudited) | 12 Months Ended |
Oct. 31, 2020 | |
Quarterly Financial Information Disclosure [Abstract] | |
Quarterly Financial Data (Unaudited) | 19 Quarterly Financial Data (Unaudited) Summarized quarterly financial data for fiscal 2020 and 2019 are as follows (dollars in thousands, except per share data): Quarter Fiscal Year Ended October 31, 2020 First Second Third Fourth Net sales $ 767,483 $ 929,398 $ 840,972 $ 840,957 Gross profit 288,088 306,717 294,574 300,395 Net earnings 70,091 98,446 88,968 72,196 Basic net earnings per share 1 0.65 0.92 0.83 0.67 Diluted net earnings per share 1 $ 0.65 $ 0.91 $ 0.82 $ 0.66 Quarter Fiscal Year Ended October 31, 2019 First Second 2 Third 2 Fourth Net sales $ 602,956 $ 962,036 $ 838,713 $ 734,379 Gross profit 215,617 321,298 265,981 245,067 Net earnings 59,540 115,570 60,607 38,266 Basic net earnings per share 1 0.56 1.08 0.57 0.36 Diluted net earnings per share 1 $ 0.55 $ 1.07 $ 0.56 $ 0.35 1 The summation of quarterly basic and diluted net earnings per share amounts may not equal the fiscal year basic and diluted net earnings per share amounts presented in the Consolidated Statements of Earnings due to differences in the number of weighted-average shares of common stock outstanding during the respective quarterly and fiscal year periods and rounding. 2 During fiscal 2019, CMW's financial position, results of operations, and cash flows were reported on a calendar month end. Accordingly, April 30, 2019 and July 31, 2019 were the calendar quarterly period end dates closest to the company's quarterly fiscal periods ended May 3, 2019 and August 2, 2019, respectively. This reporting period difference did not have material impact on the company's Consolidated Results of Operations during the company's second and third fiscal quarters of fiscal 2019. For the company's fiscal 2019 fourth quarter, the reporting period end for both CMW and the company was October 31, 2019. |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies and Related Data (Policies) | 12 Months Ended |
Oct. 31, 2020 | |
Accounting Policies [Abstract] | |
Basis of Presentation and Consolidation | Basis of Presentation and Consolidation The accompanying Consolidated Financial Statements have been prepared in accordance with accounting principles generally accepted ("GAAP") in the United States ("U.S.") and include the accounts of The Toro Company and its wholly-owned subsidiaries. Unless the context indicates otherwise, the terms "company," "TTC," "we," "our," or "us" refer to The Toro Company and its consolidated subsidiaries. In the opinion of management, the Consolidated Financial Statements include all adjustments, consisting primarily of recurring accruals, considered necessary for the fair presentation of the company's Consolidated Financial Position, Results of Operations, and Cash Flows for the periods presented. The company's businesses are organized, managed, and internally grouped into segments based on similarities in products and services. The company classifies its operations into two reportable business segments: Professional and Residential. The company's remaining activities are presented as "Other" due to their insignificance. Such Other activities consist of earnings (loss) from the company's wholly-owned domestic distribution companies, corporate activities, and the elimination of intersegment revenues and expenses. For additional information regarding the company's reportable business segments refer to Note 3, Segment Data . The company uses the equity method to account for equity investments in unconsolidated entities over which it has the ability to exercise significant influence over operating and financial policies. The company's share of the net earnings (losses) of these equity method investments are recorded |
Accounting Estimates | Accounting Estimates In preparing the Consolidated Financial Statements in conformity with U.S. GAAP, management must make decisions that impact the reported amounts of assets, liabilities, revenues, expenses, and the related disclosures, including disclosures of contingent assets and liabilities. Such decisions include the selection of the appropriate accounting principles to be applied and the assumptions on which to base accounting estimates. Estimates are used in determining, among other items, sales promotion and incentive accruals, incentive compensation accruals, income tax accruals, inventory valuation, warranty reserves, allowance for doubtful accounts, pension and post-retirement accruals, self-insurance accruals, right-of-use assets and lease liabilities, useful lives for tangible and finite-lived intangible assets, future cash flows associated with impairment testing for goodwill, indefinite-lived intangible assets and other long-lived assets, and valuations of the assets acquired and liabilities assumed in a business combination, when applicable. These estimates and assumptions are based on management's best estimates and judgments at the time they are made and are generally derived from management's understanding and analysis of the relevant and current circumstances, historical experience, and actuarial and other independent external third-party specialist valuations, when applicable. Management evaluates its estimates and |
Business Combinations | Business Combinations The company accounts for the acquisition of a business in accordance with the accounting standards codification ("ASC") guidance for business combinations, whereby the total consideration transferred is allocated to the assets acquired and liabilities assumed, including amounts attributable to non-controlling interests, when applicable, based on their respective estimated fair values as of the date of acquisition. Goodwill represents the excess of consideration transferred over the estimated fair value of the net assets acquired in a business combination. |
Cash and Cash Equivalents | Cash and Cash Equivalents The company considers all highly liquid investments purchased with an original maturity of three months or less to be cash equivalents. Cash equivalents are stated at cost, |
Receivables, Net | Receivables, Net The company's financial exposure related to the collection of accounts receivable is primarily reduced due to its Red Iron Acceptance, LLC ("Red Iron") joint venture with TCF Inventory Finance, Inc. ("TCFIF") and separate arrangement with TCF Commercial Finance Canada, Inc. ("TCFCFC"), as further discussed in Note 8, Investment in Joint Venture . The company also has floor plan financing agreements with separate third-party financial institutions to provide inventory financing to certain dealers not financed through Red Iron, which include agreements with third-party financial institutions in the U.S. and internationally in Australia. For receivables not serviced through Red Iron or other third-party floor plan financing agreements, the company provides financing in the form of open account terms in the normal course of business and performs on-going credit evaluations of customers. |
Allowance for Doubtful Accounts | The company estimates the balance of allowance for doubtful accounts by analyzing the age of accounts and notes receivable balances and applying historical write-off trend rates. The company also estimates and reserves separately, specific customer balances when it is deemed probable that the balance is uncollectible. Account balances are charged off against the allowance when all collection efforts have been exhausted. |
Concentrations of Credit Risk | Concentrations of Credit Risk Financial instruments, which potentially subject the company to concentrations of credit risk, consist principally of accounts receivable and derivative instruments. Accounts receivable balances are concentrated in the Professional and Residential business segments. The credit risk associated with these business segments is limited because of the large number of customers in the company's customer base and their geographic dispersion. The credit risk associated with the company's derivative instruments is limited as the company enters into derivative instruments with multiple counterparties that are highly rated financial institutions. |
Inventory, Net | Inventories, Net Inventories are valued at the lower of cost or net realizable value, with cost determined by the first-in, first-out ("FIFO") and average cost methods for approximately 53.0 percent and 54.0 percent of total net inventories as of October 31, 2020 and 2019, respectively. All remaining inventories are valued at the lower of cost or market, with cost determined under the last-in, first-out ("LIFO") method. During fiscal 2020 and fiscal 2019, LIFO layers were not materially reduced. Additionally, the company records an inventory valuation adjustment for excess, slow-moving, and obsolete inventory that is equal to the excess of the cost of the inventory over the estimated net realizable value or market value for the |
Property, Plant and Equipment, Net | Property, Plant and Equipment, NetProperty, plant and equipment assets are carried at cost less accumulated depreciation. The company generally accounts for depreciation of property, plant and equipment utilizing the straight-line method over the estimated useful lives of the assets. Buildings and leasehold improvements are generally depreciated over 10 to 40 years, machinery and equipment are generally depreciated over two three two |
Goodwill and Indefinite-Life Intangible Assets | Goodwill and Indefinite-Lived Intangible Assets Goodwill represents the cost of business combinations in excess of the fair values assigned to the identifiable net assets acquired. Goodwill is assigned to reporting units based upon the expected benefit of the synergies of the acquisition. Goodwill and certain trade names, which are considered to have indefinite lives, are not amortized; however, the company reviews them for impairment annually during the fourth quarter of each fiscal year or more frequently if changes in circumstances or the occurrence of events indicate that the fair value may not be recoverable. |
Other Long-Lived Assets | Other Long-Lived Assets Other long-lived assets consist of property, plant and equipment; right-of-use assets associated with operating lease agreements, capitalized implementation costs for hosted cloud-computing arrangements; and finite-lived intangible assets. The company's finite-lived intangible assets are identifiable assets that were acquired as a result of business combinations and primarily consist of patents, non-compete agreements, customer relationships and lists, backlog, trade names, and developed technology and are amortized on a straight-line basis over periods ranging from one The company reviews other long-lived assets for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset, or asset group, may not be recoverable. Asset groups have identifiable cash flows and are largely independent of other asset groups. An impairment loss is recognized when estimated undiscounted future cash flows from the operation or disposition of the asset group are less than the carrying amount of the asset group. Measurement of an impairment loss is based on the excess of the carrying amount of the asset group over its fair value. Fair value is generally measured using a discounted cash flow model or independent appraisals, as appropriate. Based on the company's impairment analysis for other long-lived assets, the company did not have any impairment losses for fiscal 2020, 2019, and 2018. For other long-lived assets to be abandoned, the company tests for potential impairment. If the company commits to a plan to abandon or dispose of an other long-lived asset, or asset group, before the end of its previously estimated useful life, depreciation or amortization estimates are revised. |
Leases | Leases The company enters into contracts for operating lease agreements that convey the company's right to direct the use of, and obtain substantially all of the economic benefits from, an identified asset for a defined period of time in exchange for consideration. The lease term begins and is determined upon lease commencement, which is the point in time when the company takes possession of the identified asset, and includes all non-cancelable periods. Lease liabilities represent the company's obligation to make lease payments arising from the lease agreement. The company accounts for operating lease liabilities at lease commencement and on an ongoing basis as the present value of the minimum remaining lease payments under the respective lease term. Lease payments are determined at lease commencement and represent fixed lease payments as defined within the respective lease agreement or, in the case of certain lease agreements, variable lease payments that are measured as of the lease commencement date based on the prevailing index or market rate. Future adjustments to variable lease payments are defined and scheduled within the respective lease agreement and are determined based upon the prevailing market or index rate at the time of the adjustment relative to the market or index rate determined at lease commencement. Certain other lease agreements contain variable lease payments that are determined based upon actual utilization of the identified asset. Such future adjustments to variable lease payments and variable lease payments based upon actual utilization of the identified asset are not included within the determination of lease payments at commencement but rather, are recorded as variable lease expense in the period in which the variable lease cost is incurred. The company has operating leases with both lease components and non-lease components. For purposes of determining lease payments, the company accounts for lease components separately from non-lease components based on the relative market value of each component. Non-lease components typically consist of common area maintenance, utilities, and/or other repairs and maintenance services. The costs related to non-lease components are not included within the determination of lease payments at commencement. Minimum remaining lease payments are discounted to present value based on the rate implicit in the operating lease agreement or the estimated incremental borrowing rate at lease commencement if the rate implicit in the lease is not readily determinable. Right-of-use assets represent the company's right to use an underlying asset throughout the lease term and are measured as the amount of the corresponding operating lease liability for the respective operating lease agreement, adjusted for prepaid or accrued lease payments, the remaining balance of any lease incentives received, unamortized initial direct costs, and impairment of the operating lease right-of-use asset, as applicable. Lease expense for the company's operating leases is recognized on a straight-line basis over the lease term and is recorded within either cost of sales or selling, general and administrative expense in the Consolidated Statements of Earnings depending on the nature and use of the identified asset underlying the respective operating lease arrangement. The company does not recognize right-of-use assets and lease liabilities, but does recognize expense on a straight-line basis, for short-term operating leases which have a lease term of 12 months or less and do not include an option to purchase the underlying asset. |
Accounts Payable | Accounts PayableThe company has a supply chain finance service agreement with a third-party financial institution to provide a web-based platform that facilitates the ability of participating suppliers to finance payment obligations from the company with the third-party financial institution. Participating suppliers may, at their sole discretion, make offers to finance one or more payment obligations of the company prior to their scheduled due dates at a discounted price to the third-party financial institution. The company's obligations to its suppliers, including amounts due and scheduled payment dates, are not affected by suppliers' decisions to finance amounts under this supply chain finance arrangement. |
Insurance | Insurance The company is self-insured for certain losses relating to employee medical, dental, workers' compensation, and certain product liability claims. Specific stop loss coverages are provided for catastrophic claims in order to limit exposure to significant claims. Losses and claims are charged to net earnings when it is probable a loss has been incurred and the amount can be reasonably estimated. Self-insured liabilities are based on a number of factors, including historical claims experience, an estimate of claims incurred but not reported, demographic and severity factors, and utilizing valuations provided by independent third-party actuaries. |
Product Warranty Guarantees | Product Warranty Guarantees The company’s products are warranted to provide assurance that the product will function as expected and to ensure customer confidence in design, workmanship, and overall quality. Warranty coverage is generally provided for specified periods of time and on select products’ hours of usage, and generally covers parts, labor, and other expenses for non-maintenance repairs. Warranty coverage generally does not cover operator abuse or improper use. An authorized company distributor or dealer must perform warranty work. Distributors and dealers submit claims for warranty reimbursement and are credited for the cost of repairs, labor, and other expenses as long as the repairs meet the company's prescribed standards. Service support outside of the warranty period is provided by authorized distributors and dealers at the customer's expense. In addition to the standard warranties offered by the company on its products, the company also sells separately priced extended warranty coverage on select products for a prescribed period after the original warranty period expires. The company recognizes expense and records an accrual for estimated future warranty costs at the time of sale and also establishes accruals for major rework campaigns. Warranty accruals are based primarily on the estimated number of products under warranty, historical average costs incurred to service warranty claims, the trend in the historical ratio of claims to sales, and the historical length of time between the sale and resulting warranty claim. The company periodically assesses the adequacy of its warranty accruals based on changes in these factors and records any necessary adjustments if actual claims experience indicates that adjustments are necessary. |
Derivatives Instruments and Hedging Activities | Derivative Instruments and Hedging Activities Derivative instruments, consisting primarily of forward currency contracts, are used to hedge most foreign currency transactions, including forecasted sales and purchases denominated in foreign currencies. All derivative instruments are recognized on the Consolidated Balance Sheets at fair value as either assets or liabilities. If the derivative instrument is designated as a cash flow hedging instrument, changes in the fair values of the spot rate component of outstanding, highly effective cash flow hedging instruments included in the assessment of hedge effectiveness are recorded in other comprehensive income within accumulated other comprehensive loss (“AOCL”) on the Consolidated Balance Sheets and are subsequently reclassified to net earnings within the Consolidated Statements of Earnings during the same period in which the cash flows of the underlying hedged transaction affect net earnings. Changes in the fair values of hedge components excluded from the assessment of effectiveness are recognized immediately in net earnings under the mark-to-market approach. Derivatives that are not designated as cash flow hedging instruments are adjusted to fair value through other income, net, on the Consolidated Statements of Earnings. |
Foreign Currency Translation and Transactions | Foreign Currency Translation and Transactions The functional currency of the company's foreign operations is generally the applicable local currency. The functional currency is translated into U.S. dollars using the respective current exchange rate in effect as of the balance sheet date for balance sheet accounts and the respective weighted-average exchange rate during the fiscal year for revenue and expense accounts. The resulting translation adjustments are deferred as a component of other comprehensive income within the Consolidated Statements of Comprehensive Income and the Consolidated Statements of Stockholders' Equity. Gains or losses resulting from transactions denominated in foreign currencies are included in other income, net in the Consolidated Statements of Earnings. |
Debt Issuance Costs | Debt Issuance Costs Debt issuance costs incurred in connection with securing the company’s financing arrangements are capitalized and amortized over the term of the respective financing arrangement under the straight-line method as the results obtained are not materially different from those that would result from the use of the effective interest method. Debt issuance costs are generally presented in the Consolidated |
Income Taxes | Income Taxes Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years that those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income tax expense in the period that includes the enactment date. A valuation allowance is provided when, in management's judgment, it is more likely than not that some portion or all of the deferred tax asset will not be realized. The company has reflected the necessary deferred tax assets and liabilities in the accompanying Consolidated Balance Sheets. Management believes the future tax deductions will be realized principally through future taxable income, future reversals of existing taxable temporary differences, and carryback to taxable income in prior years. The company recognizes the effect of income tax positions only if those positions are more likely than not of being sustained. Recognized income tax positions are measured at the largest amount that is greater than 50.0 percent likely to be realized. Changes in recognition or measurement are reflected in the period in which the change in judgment occurs. The company also records interest and penalties related to unrecognized tax benefits within income tax expense. |
Revenue Recognition | Revenue Recognition The company's primary source of revenue is generated through the sale of equipment and irrigation products and services to its customers, which primarily consist of a worldwide network of distributors, dealers, mass retailers, hardware retailers, home centers, as well as online (direct to end-users). The company enters into contracts with its customers for the sale of products or rendering of services in the ordinary course of business. A contract with commercial substance exists at the time the company receives and accepts a purchase order under a sales contract with a customer. The company recognizes revenue when, or as, performance obligations under the terms of a contract with its customer are satisfied, which occurs with the transfer of control of product or services. Control is typically transferred to the customer at the time a product is shipped, or in the case of certain agreements, when a product is delivered or as services are rendered. Revenue is recognized based on the transaction price, which is measured as the amount of consideration the company expects to receive in exchange for transferring product or rendering services pursuant to the terms of the contract with a customer. The amount of consideration the company receives and the revenue the company recognizes varies with changes in the variable consideration associated with the estimated expense of the company's sales promotions and incentives programs offered to customers, as well as anticipated product returns. A provision is made at the time revenue is recognized as a reduction of the transaction price for variable consideration, consisting primarily of expected product returns, rebates, floor plan costs, and other sales promotion and incentive program expenses. If a contract contains more than one performance obligation, the transaction price is allocated to each performance obligation based on the relative standalone selling price of the respective promised good or service. The company does not recognize revenue in situations where collectability from the customer is not probable, and defers the recognition of revenue until collection is probable or payment is received and performance obligations are satisfied. Additionally, the company ships some of its products to a mass retailer's distribution centers on a consignment basis. The company retains control of its products stored at the mass retailer's distribution centers. As the company's products are removed from the distribution centers by the mass retailer and shipped to the mass retailer's stores, control is transferred from the company to the mass retailer. At that time, the company invoices the mass retailer and recognizes revenue for these consignment transactions. The company does not offer a right of return for products shipped to the mass retailer's stores from the distribution centers. The value of consignment inventory as of October 31, 2020 and 2019 was $24.6 million and $19.9 million, respectively. Freight and shipping revenue billed to customers concurrent with revenue producing activities is included within revenue and the cost for freight and shipping is recognized as an expense within cost of sales when control has transferred to the customer. Shipping and handling activities that occur after control of the related products is transferred are treated as a fulfillment activity rather than a promised service, and therefore, are not considered a performance obligation. Sales, use, value-added, and other excise taxes the company collects concurrent with revenue producing activities are excluded from revenue. Incremental costs of obtaining a contract for which the performance obligations will be satisfied within the next twelve months are expensed as incurred. Incidental items, including goods or services, that are immaterial in the context of the contract are recognized as expense when incurred. Sales Promotions and Incentives The company records an estimate for the variable consideration associated with the estimated expense of the company's sales promotions and incentives programs offered to customers when revenue is recognized. The company estimates variable consideration related to products sold under its sales promotions and incentive programs using the expected value method, which is based on the terms of the sales arrangements with customers, historical payment and rebate claims experience, field inventory levels, volume purchases, and expectations for changes in relevant trends in the future. The estimated expense of each program is classified as a reduction from gross sales or as a component of selling, general and administrative expense, depending on the nature of the respective program. Examples of significant sales promotions and incentive programs in which the related expense is classified as a reduction from gross sales are as follows: • Off-Invoice Discounts: The company's costs for off-invoice discounts represent a reduction in the selling price of its products given at the time of sale. • Rebate Programs: The company's rebate programs are generally based on claims submitted from either its direct customers or end-users of its products, depending upon the program. The amount of the rebate varies based on the specific program and is either a dollar amount or a percentage of the purchase price and can also be based on actual retail price as compared to the company's selling price. • Incentive Discounts: The company's costs for incentive discount programs are based on its customers’ purchase or retail sales goals of certain quantities or mixes of product during a specified time period, which are tracked on an annual or quarterly basis depending on the program. • Financing Programs: The company's financing programs, consist of wholesale floor plan financing programs with Red Iron and separate third-party financial institutions and end-user retail financing. Costs incurred for wholesale floor plan financing programs represent financing costs associated with programs under which the company shares the expense of financing distributor and dealer inventories through third-party financing arrangements for a specific period of time. This charge represents interest for a pre-established length of time based on a predefined rate from the contract between the company and Red Iron or the separate third-party financial institution to finance distributor and dealer inventory purchase. The wholesale financing costs for distributor and dealer inventories were $24.1 million, $44.5 million, and $37.1 million for the fiscal years ended October 31, 2020, 2019 and 2018, respectively. End-user retail financing is similar to floor planning with the difference being that retail financing programs are offered to end-user customers under which the company, at its discretion, may pay a portion of interest costs on behalf of end-users for financing purchases of the company's equipment. • Commissions Paid to Service Home Centers: The company pays commissions to representative agencies to service home centers to ensure appropriate store sets for all of the company's products. In addition, the company's dealers are paid a commission to set up and deliver riding product purchased at certain home centers. Examples of significant sales promotions and incentive programs in which the related expense is classified as a component of selling, general, and administrative expense are as follows: • Commissions Paid to Distributors and Dealers: For certain products, the company uses a distribution network of dealers and distributors that purchase and take possession of products for sale to the end customer. In addition, the company has dealers and distributors that act as sales agents for it on certain products using a direct-selling type model. Under this direct-selling type model, the company's network of distributors and dealers facilitates a sale directly to the dealer or end-user customer on its behalf. Commissions to distributors and dealers in these instances represent commission payments to sales agents that are also its customers. • Cooperative Advertising: Cooperative advertising programs are based on advertising costs incurred by distributors and dealers for promoting the company's products. The company supports a portion of those advertising costs in which claims are submitted by the distributor or dealer along with evidence of the advertising material procured/produced and evidence of the cost incurred in the form of third-party invoices or receipts. |
Cost of Sales | Cost of Sales Cost of sales is primarily comprised of direct materials and supplies consumed to manufacture the company's products, as well as manufacturing labor and direct overhead expense necessary to convert direct materials and supplies into finished product. Cost of sales also includes inbound freight costs for direct materials and supplies; outbound freight costs for shipping products to customers; charges associated with inventory valuation adjustments for excess, slow-moving, and obsolete inventory; depreciation and amortization expense on manufacturing-related tangible and intangible assets; operating lease expense related to leased manufacturing assets; cost of services provided; and cash discounts on payments to vendors. |
Selling, General, and Administrative Expense | Selling, General and Administrative Expense Selling, general and administrative expense is primarily comprised of payroll and benefits costs, occupancy and operating costs of distribution and corporate facilities, warranty expense, depreciation and amortization expense on non-manufacturing tangible and intangible assets, operating lease expense related to leased non-manufacturing assets; advertising and marketing expenses, selling expenses, |
Advertising Expense | Advertising ExpenseGeneral advertising expenditures are expensed the first time advertising takes place. Production costs associated with advertising are expensed in the period incurred. Cooperative advertising represents expenditures for shared advertising costs that the company reimburses to customers and is classified as a component of selling, general and administrative expense within the Consolidated Statements of Earnings. These obligations are accrued and expensed when the related revenues are recognized in accordance with the programs established for various product lines. |
Engineering and Research Expense | Engineering and Research ExpenseThe company's engineering and research costs are expensed as incurred as a component of selling, general and administrative expense within the Consolidated Statements of Earnings and are primarily incurred in connection with the development of new products that may have additional applications or represent extensions of existing product lines, improvements to existing products, and cost reduction efforts. |
Stock-Based Compensation Expense | Stock-Based Compensation ExpenseThe company's stock-based compensation awards are generally granted to executive officers, other employees, and non-employee members of the company's Board of Directors ("Board"), and include unrestricted common stock awards, performance share awards that are contingent on the achievement of performance goals of the company, non-qualified stock options, and restricted stock units. Generally, compensation expense equal to the grant date fair value is recognized for these awards over the vesting period and is classified in selling, general and administrative expense. For stock options and restricted stock units, expense recognized for other employees not considered executive officers and non-employee members of the company's Board is net of estimated forfeitures, which is based on historical forfeiture experience. Stock options granted to executive officers and other employees are subject to accelerated expensing if the option holder meets the retirement definition set forth in The Toro Company Amended and Restated 2010 Equity and Incentive Plan, as amended and restated (the "2010 plan"). In that case, the fair value of the options is expensed in the fiscal year of grant because generally, if the option holder is employed as of the end of the fiscal year in which the options are granted, such options will not be forfeited but continue to vest according to their schedule following retirement. |
Net Earnings Per Share | Net Earnings Per Share Basic net earnings per share is calculated as net earnings available to common stockholders divided by the weighted-average number of shares of common stock outstanding during the year plus the assumed issuance of contingent shares related to performance share awards under the 2010 plan. Diluted net earnings per share is similar to basic net earnings per share except that the weighted-average number of shares of common stock outstanding plus the assumed issuance of contingent shares is increased to include the number of additional shares of common stock that would have been outstanding assuming the issuance of all potentially dilutive shares, such as common stock to be issued upon exercise of options, contingently issuable shares, and restricted stock units. |
New Accounting Pronouncements Adopted | New Accounting Pronouncements Adopted In February 2016, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") No. 2016-02, Leases (Topic 842) ("ASU 2016-02"), which, among other things, requires lessees to recognize most leases on-balance sheet. The standard requires the recognition of right-of-use assets and lease liabilities by lessees for those leases classified as operating leases under legacy accounting guidance at ASC Topic 840, Leases . The standard also requires a greater level of quantitative and qualitative disclosures regarding the nature of the entity’s leasing activities than were previously required under U.S. GAAP. In January 2018, the FASB issued ASU No. 2018-01, Leases (Topic 842): Land Easement Practical Expedient for Transition to Topic 842 , which provides an optional transition practical expedient to not evaluate existing or expired land easements under the amended lease guidance. In July 2018, the FASB issued ASU 2018-10, Codification Improvements to Topic 842 (Leases) , which provides narrow amendments to clarify how to apply certain aspects of the new lease standard. Additionally, in July 2018, the FASB issued ASU No. 2018-11, Leases (Topic 842): Targeted Improvements , which provides an alternative transition method that permits an entity to use the effective date of ASU No. 2016-02 as the date of initial application through the recognition of a cumulative effect adjustment to the opening balance of retained earnings upon adoption. Consequently, an entity's reporting for the comparative periods presented in the financial statements in which it adopts the new lease standard will continue to be in accordance with previous U.S. GAAP under ASC Topic 840, Leases . ASU No. 2016-02, as augmented by ASU No. 2018-01, ASU No. 2018-10, and ASU No. 2018-11 (the "amended guidance"), was adopted by the company on November 1, 2019, the first quarter of fiscal 2020, under the modified retrospective transition method with no cumulative-effect adjustment to beginning retained earnings within the Consolidated Balance Sheet as of such date. Under such transition method, the company elected the following practical expedients: • The transition package of practical expedients, which among other things, allows the company to carryforward the historical lease classification determined under previous U.S. GAAP. • The transition practical expedient to not reassess the company's accounting for land easements that exist as of the adoption of the amended guidance. • The short-term lease exemption to not record right-of-use assets and lease liabilities on the Consolidated Balance Sheet for leases with an initial lease term of 12 months or less, which has resulted in recognizing the lease payments related to such leases within the company's Consolidated Statements of Earnings on a straight-line basis over the lease term. The company did not elect the transition practical expedient to use hindsight in determining the lease term and in assessing the impairment of right-of-use assets. Upon adoption of the amended guidance, the company recorded $78.1 million of right-of-use assets and $77.1 million of corresponding lease liabilities within the Consolidated Balance Sheet as of November 1, 2019. The adoption of the standard did not have a material impact on the company's Consolidated Statements of Earnings, Consolidated Statements of Cash Flows, business processes, internal controls, and information systems. As permitted under the amended guidance, prior period amounts were not restated, but are and will continue to be reported under the legacy accounting guidance that was in effect for the respective prior periods. In June 2018, the FASB issued ASU No. 2018-07, Compensation - Stock Compensation (Topic 718): Improvements to Nonemployee Share-Based Payment Accounting , which amends ASC Topic 718, Compensation - Stock Compensation , to include share-based payment transactions for acquiring goods and services from nonemployees. The standard requires that most of the guidance related to stock compensation granted to employees be followed for nonemployees, including the measurement date, valuation approach, and performance conditions. The amended guidance was adopted in the first quarter of fiscal 2020 and did not have a material impact on the company's Consolidated Financial Statements. New Accounting Pronouncements Not Yet Adopted In June 2016, the FASB issued ASU No. 2016-13, Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments , which modifies the measurement approach for credit losses on financial assets measured on an amortized cost basis from an 'incurred loss' method to an 'expected loss' method. Such modification of the measurement approach for credit losses eliminates the requirement that a credit loss be considered probable, or incurred, to impact the valuation of a financial asset measured on an amortized cost basis. The amended guidance requires the measurement of expected credit losses to be based on relevant information, including historical experience, current conditions, and a reasonable and supportable forecast that affects the collectability of the related financial asset. This amendment affects trade receivables, off-balance-sheet credit exposures, and any other financial assets not excluded from the scope of this amendment that have the contractual right to receive cash. The company will adopt the amended guidance on November 1, 2020, the first quarter of fiscal 2021, under the modified retrospective transition method. The adoption of the amended guidance will not have a material impact on the company's Consolidated Financial Statements. In August 2018, the FASB issued ASU No. 2018-13, Fair Value Measurement (Topic 820) - Changes to the Disclosure Requirements for Fair Value Measurement , which modifies the disclosure requirements for fair value measurements by removing, modifying, or adding certain disclosures. The company will adopt the amended guidance on November 1, 2020, the first quarter of fiscal 2021, and such adoption will not have a material impact on the company's Consolidated Financial Statements. In August 2018, the FASB issued ASU No. 2018-14, Compensation - Retirement Benefits - Defined Benefit Plans (Topic 715) , which modifies the disclosure requirements for defined benefit pension plans and other post-retirement plans. The company will adopt the amended guidance on November 1, 2020, the first quarter of fiscal 2021, and such adoption will not have a material impact on the company's Consolidated Financial Statements. In December 2019, the FASB issued ASU No. 2019-12, I ncome Taxes (Topic 740): Simplifying the Accounting for Income Taxes , which eliminates certain exceptions related to the approach for intraperiod tax allocation, the methodology for calculating income taxes in an interim period, and the recognition of deferred tax liabilities for outside basis differences. The amended guidance also clarifies and simplifies other aspects of the accounting for income taxes under ASC Topic 740, Income Taxes . The amended guidance will become effective in the first quarter of fiscal 2022. Early adoption is permitted. The company is currently evaluating the impact of this new standard on its Consolidated Financial Statements. In January 2020, the FASB issued ASU No. 2020-01, Investments - Equity Securities (Topic 321), Investments - Equity Method and Joint Ventures (Topic 323), and Derivatives and Hedging (Topic 815) , which clarified that before applying or upon discontinuing the equity method of accounting for an investment in equity securities, an entity should consider observable transactions that require it to apply or discontinue the equity method of accounting for the purposes of applying the fair value measurement alternative. The amended guidance will become effective in the first quarter of fiscal 2022. Early adoption is permitted. The company is currently evaluating the impact of this standard on its Consolidated Financial Statements. In March 2020, the FASB issued ASU No. 2020-04, Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting , which provides temporary optional guidance to ease the potential burden of accounting for reference rate reform due to the cessation of the London Interbank Offered Rate, commonly referred to as "LIBOR." The temporary guidance provides optional expedients and exceptions for applying U.S. GAAP to contracts, relationships, and transactions affected by reference rate reform if certain criteria are met. The provisions of the temporary optional guidance are only available until December 31, 2022, when the reference rate reform activity is expected to be substantially complete. When adopted, entities may apply the provisions as of the beginning of the reporting period when the election is made. The company is currently evaluating the impact of this standard on its Consolidated Financial Statements and has yet to elect an adoption date. The company believes that all other recently issued accounting pronouncements from the FASB that the company has not noted above, will not have a material impact on its Consolidated Financial Statements or do not apply to its operations. |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies and Related Data (Tables) | 12 Months Ended |
Oct. 31, 2020 | |
Accounting Policies [Abstract] | |
Schedule of inventories | Inventories, net were as follows (in thousands): October 31 2020 2019 Raw materials and work in process $ 168,759 $ 179,967 Finished goods and service parts 565,761 553,767 Total FIFO value 734,520 733,734 Less: adjustment to LIFO value 82,087 82,071 Total inventories, net $ 652,433 $ 651,663 |
Schedule of property, plant and equipment | Property, plant and equipment, net was as follows (in thousands): October 31 2020 2019 Land and land improvements $ 57,387 $ 55,613 Buildings and leasehold improvements 301,848 276,556 Machinery and equipment 499,312 453,314 Tooling 231,142 226,870 Computer hardware and software 102,312 94,409 Construction in process 48,157 34,937 Property, plant and equipment, gross 1,240,158 1,141,699 Less: accumulated depreciation 772,239 704,382 Property, plant and equipment, net $ 467,919 $ 437,317 |
Schedule of changes in accrued warranties | The changes in accrued warranties were as follows (in thousands): Fiscal Years Ended October 31 2020 2019 2018 Beginning balance $ 96,604 $ 76,214 $ 74,155 Warranty provisions 60,273 57,277 49,160 Acquisitions 2,557 18,418 — Warranty claims (67,241) (58,878) (45,662) Changes in estimates 14,928 3,573 (1,439) Ending balance $ 107,121 $ 96,604 $ 76,214 |
Reconciliations of basic and diluted weighted-average shares of common stock outstanding | Reconciliations of basic and diluted weighted-average shares of common stock outstanding are as follows (in thousands): Fiscal Years Ended October 31 2020 2019 2018 Basic Weighted-average number of shares of common stock 107,647 106,762 106,356 Assumed issuance of contingent shares 11 11 13 Weighted-average number of shares of common stock outstanding – Basic 107,658 106,773 106,369 Diluted Weighted-average number of shares of common stock outstanding – Basic 107,658 106,773 106,369 Effect of dilutive securities 1,005 1,317 2,288 Weighted-average number of shares of common stock outstanding – Diluted 108,663 108,090 108,657 |
Business Combinations (Tables)
Business Combinations (Tables) | 12 Months Ended |
Oct. 31, 2020 | |
Business Combinations [Abstract] | |
Schedule of recognized identified assets acquired and liabilities assumed | The following table summarizes the allocation of the Venture Products purchase price to the fair values assigned to the Venture Products assets acquired and liabilities assumed (in thousands): March 2, 2020 Cash and cash equivalents $ 3,476 Receivables 6,342 Inventories 23,000 Prepaid expenses and other current assets 239 Property, plant and equipment 26,976 Goodwill 62,252 Other intangible assets 75,300 Accounts payable (4,075) Accrued liabilities (5,959) Deferred income tax liabilities (20,850) Total fair value of net assets acquired 166,701 Less: cash and cash equivalents acquired (3,476) Total Venture Products purchase price $ 163,225 The following table summarizes the allocation of the CMW purchase price to the fair values assigned to the CMW assets acquired and liabilities assumed (in thousands): April 1, 2019 Cash and cash equivalents $ 16,341 Receivables 65,674 Inventories 241,429 Prepaid expenses and other current assets 8,050 Property, plant and equipment 142,779 Goodwill 134,657 Other intangible assets: Customer-related 130,800 Developed technology 20,900 Finite-lived trade names 5,200 Indefinite-lived trade names 103,700 Backlog 3,590 Other long-term assets 7,971 Accounts payable (35,892) Accrued liabilities (51,943) Deferred income tax liabilities (85,277) Other long-term liabilities (6,665) Total fair value of net assets acquired 701,314 Less: cash and cash equivalents acquired (16,341) Total CMW purchase price $ 684,973 |
Finite-lived and indefinite-lived intangible assets acquired as part of business combination | The fair values of the other intangible assets acquired on the Venture Products closing date, related accumulated amortization from the Venture Products closing date through October 31, 2020, and weighted-average useful lives in years were as follows (in thousands, except weighted-average useful life in years): Weighted-Average Useful Life in Years Gross Carrying Amount Accumulated Amortization Net Finite-lived - customer-related 16.0 $ 19,100 $ (796) $ 18,304 Indefinite-lived - trade name 56,200 — 56,200 Total other intangible assets, net $ 75,300 $ (796) $ 74,504 |
Business acquisition, pro forma information | The following table presents unaudited pro forma financial information for fiscal 2019 and 2018 (in thousands, except per share data): October 31, 2019 October 31, 2018 Net sales $ 3,437,335 $ 3,332,636 Net earnings 1 363,452 276,722 Basic net earnings per share of common stock 3.40 2.60 Diluted net earnings per share of common stock 1 $ 3.36 $ 2.55 1 On January 1, 2019, CMW amended its retiree medical plans so that no employee hired, or rehired, after that date would be eligible for such retiree medical plans. CMW further amended its retiree medical plans on February 14, 2019 so that no employee who terminates employment after February 14, 2019 is eligible to participate in the retiree medical plans and to terminate its retiree medical plans effective December 31, 2019. The amendments and resulting termination of CMW's retiree medical plans resulted in a gain of $45.8 million. This gain is reflected within net earnings in the unaudited pro forma financial information for the fiscal year ended October 31, 2019. The impact on diluted net earnings per share of common stock for the fiscal year ended October 31, 2019 was $0.42 per diluted share of common stock. |
Segment Data (Tables)
Segment Data (Tables) | 12 Months Ended |
Oct. 31, 2020 | |
Segment Reporting [Abstract] | |
Summarized financial information concerning the company's reportable segments | The following tables present summarized financial information concerning the company's reportable business segments and Other activities (in thousands): Fiscal Year Ended October 31, 2020 Professional Residential Other Total Net sales $ 2,523,452 $ 820,745 $ 34,613 $ 3,378,810 Intersegment gross sales (eliminations) 46,703 80 (46,783) — Earnings (loss) before income taxes 426,560 113,669 (133,159) 407,070 Total assets 1,940,844 282,061 630,323 2,853,228 Capital expenditures 49,975 13,669 14,424 78,068 Depreciation and amortization $ 70,460 $ 12,607 $ 12,548 $ 95,615 Fiscal Year Ended October 31, 2019 Professional Residential Other Total Net sales $ 2,443,448 $ 661,274 $ 33,362 $ 3,138,084 Intersegment gross sales (eliminations) 59,453 310 (59,763) — Earnings (loss) before income taxes 380,914 65,151 (123,932) 322,133 Total assets 1,592,065 430,495 307,987 2,330,547 Capital expenditures 57,246 16,970 18,665 92,881 Depreciation and amortization $ 63,885 $ 11,897 $ 11,916 $ 87,698 Fiscal Year Ended October 31, 2018 Professional Residential Other Total Net sales $ 1,946,999 $ 654,413 $ 17,238 $ 2,618,650 Intersegment gross sales (eliminations) 29,798 312 (30,110) — Earnings (loss) before income taxes 399,806 64,807 (92,216) 372,397 Total assets 916,106 199,273 455,605 1,570,984 Capital expenditures 58,109 16,014 16,001 90,124 Depreciation and amortization $ 38,585 $ 9,999 $ 12,693 $ 61,277 |
Summary of the components of the loss before income taxes included in "Other" | The following table presents the details of operating loss before income taxes for the company's Other activities (in thousands): Fiscal Years Ended October 31 2020 2019 2018 Corporate expenses $ (108,396) $ (124,422) $ (92,541) Interest expense (33,156) (28,835) (19,096) Earnings from wholly-owned domestic distribution companies and other income, net 8,393 29,325 19,421 Total operating loss $ (133,159) $ (123,932) $ (92,216) |
Schedule of net sales for groups of similar products and services | The following table presents net sales for groups of similar products and services (in thousands): Fiscal Years Ended October 31 2020 2019 2018 Equipment $ 2,985,295 $ 2,747,935 $ 2,210,047 Irrigation and lighting 393,515 390,149 408,603 Total net sales $ 3,378,810 $ 3,138,084 $ 2,618,650 |
Schedule of geographic area data | The following geographic area data includes net sales based on product shipment destination and long-lived assets, which consist of property, plant and equipment, net, and is based on physical location in addition to allocated capital tooling from U.S. plant facilities (in thousands): Fiscal Years Ended October 31 United States International Countries Total 2020 Net sales $ 2,700,694 $ 678,116 $ 3,378,810 Long-lived assets $ 426,378 $ 41,541 $ 467,919 2019 Net sales $ 2,413,153 $ 724,931 $ 3,138,084 Long-lived assets $ 395,937 $ 41,380 $ 437,317 2018 Net sales $ 1,975,562 $ 643,088 $ 2,618,650 Long-lived assets $ 230,246 $ 41,213 $ 271,459 |
Revenue (Tables)
Revenue (Tables) | 12 Months Ended |
Oct. 31, 2020 | |
Revenue from Contract with Customer [Abstract] | |
Disaggregation of revenue | The following tables disaggregate the company's reportable segment net sales by major product type and geographic market (in thousands): Fiscal Year Ended October 31, 2020 Professional Residential Other Total Revenue by product type: Equipment $ 2,175,794 $ 787,716 $ 21,785 $ 2,985,295 Irrigation 347,658 33,029 12,828 393,515 Total net sales $ 2,523,452 $ 820,745 $ 34,613 $ 3,378,810 Revenue by geographic market: United States $ 1,976,690 $ 689,391 $ 34,613 $ 2,700,694 International Countries 546,762 131,354 — 678,116 Total net sales $ 2,523,452 $ 820,745 $ 34,613 $ 3,378,810 Fiscal Year Ended October 31, 2019 Professional Residential Other Total Revenue by product type: Equipment $ 2,097,965 $ 628,521 $ 21,449 $ 2,747,935 Irrigation 345,483 32,753 11,913 390,149 Total net sales $ 2,443,448 $ 661,274 $ 33,362 $ 3,138,084 Revenue by geographic market: United States $ 1,853,054 $ 526,737 $ 33,362 $ 2,413,153 International Countries 590,394 134,537 — 724,931 Total net sales $ 2,443,448 $ 661,274 $ 33,362 $ 3,138,084 Fiscal Year Ended October 31, 2018 Professional Residential Other Total Revenue by product type: Equipment $ 1,582,024 $ 617,827 $ 10,196 $ 2,210,047 Irrigation 364,975 36,586 7,042 408,603 Total net sales $ 1,946,999 $ 654,413 $ 17,238 $ 2,618,650 Revenue by geographic market: United States $ 1,441,815 $ 516,509 $ 17,238 $ 1,975,562 International Countries 505,184 137,904 — 643,088 Total net sales $ 1,946,999 $ 654,413 $ 17,238 $ 2,618,650 |
Goodwill and Other Intangible_2
Goodwill and Other Intangible Assets (Tables) | 12 Months Ended |
Oct. 31, 2020 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of changes in net carrying amount of goodwill | The changes in the carrying amount of goodwill by reportable segment for fiscal 2020 and 2019 were as follows (in thousands): Professional Residential Other Total Balance as of October 31, 2018 $ 214,827 $ 10,463 $ — $ 225,290 Goodwill acquired 135,524 — 1,534 137,058 Translation adjustments (101) 6 — (95) Balance as of October 31, 2019 350,250 10,469 1,534 362,253 Goodwill acquired 62,252 — — 62,252 Purchase price allocation adjustment (866) — — (866) Translation adjustments 425 11 — 436 Balance as of October 31, 2020 $ 412,061 $ 10,480 $ 1,534 $ 424,075 |
Schedule of finite-lived intangible assets | The components of other intangible assets were as follows (in thousands, except weighted-average useful life in years): October 31, 2020 Weighted-Average Useful Life in Years Gross Carrying Amount Accumulated Amortization Net Patents 9.9 $ 18,257 $ (13,919) $ 4,338 Non-compete agreements 5.5 6,892 (6,831) 61 Customer-related 18.2 239,634 (48,005) 191,629 Developed technology 7.6 51,995 (35,208) 16,787 Trade names 15.4 7,530 (2,552) 4,978 Backlog and other 0.6 4,390 (4,390) — Total finite-lived 15.5 328,698 (110,905) 217,793 Indefinite-lived - trade names 190,512 — 190,512 Total other intangible assets, net $ 519,210 $ (110,905) $ 408,305 October 31, 2019 Weighted-Average Useful Life in Years Gross Carrying Amount Accumulated Amortization Net Patents 9.9 $ 18,230 $ (13,102) $ 5,128 Non-compete agreements 5.5 6,868 (6,786) 82 Customer-related 18.4 220,390 (33,547) 186,843 Developed technology 7.6 51,911 (31,289) 20,622 Trade names 15.4 7,496 (2,109) 5,387 Backlog and other 0.6 4,390 (4,390) — Total finite-lived 15.5 309,285 (91,223) 218,062 Indefinite-lived - trade names 134,312 — 134,312 Total other intangible assets, net $ 443,597 $ (91,223) $ 352,374 |
Schedule of indefinite-lived intangible assets | The components of other intangible assets were as follows (in thousands, except weighted-average useful life in years): October 31, 2020 Weighted-Average Useful Life in Years Gross Carrying Amount Accumulated Amortization Net Patents 9.9 $ 18,257 $ (13,919) $ 4,338 Non-compete agreements 5.5 6,892 (6,831) 61 Customer-related 18.2 239,634 (48,005) 191,629 Developed technology 7.6 51,995 (35,208) 16,787 Trade names 15.4 7,530 (2,552) 4,978 Backlog and other 0.6 4,390 (4,390) — Total finite-lived 15.5 328,698 (110,905) 217,793 Indefinite-lived - trade names 190,512 — 190,512 Total other intangible assets, net $ 519,210 $ (110,905) $ 408,305 October 31, 2019 Weighted-Average Useful Life in Years Gross Carrying Amount Accumulated Amortization Net Patents 9.9 $ 18,230 $ (13,102) $ 5,128 Non-compete agreements 5.5 6,868 (6,786) 82 Customer-related 18.4 220,390 (33,547) 186,843 Developed technology 7.6 51,911 (31,289) 20,622 Trade names 15.4 7,496 (2,109) 5,387 Backlog and other 0.6 4,390 (4,390) — Total finite-lived 15.5 309,285 (91,223) 218,062 Indefinite-lived - trade names 134,312 — 134,312 Total other intangible assets, net $ 443,597 $ (91,223) $ 352,374 |
Indebtedness (Tables)
Indebtedness (Tables) | 12 Months Ended |
Oct. 31, 2020 | |
Debt Disclosure [Abstract] | |
Schedule of long-term debt | The following is a summary of the company's indebtedness (in thousands): October 31, 2020 October 31, 2019 Revolving credit facility $ — $ — $200 million term loan 100,000 100,000 $300 million term loan 180,000 180,000 $190 million term loan 90,000 — 3.81% series A senior notes 100,000 100,000 3.91% series B senior notes 100,000 100,000 7.8% debentures 100,000 100,000 6.625% senior notes 123,978 123,916 Less: unamortized discounts, debt issuance costs, and deferred charges 2,855 3,103 Total long-term debt 791,123 700,813 Less: current portion of long-term debt 99,873 79,914 Long-term debt, less current portion $ 691,250 $ 620,899 |
Investment in Joint Venture (Ta
Investment in Joint Venture (Tables) | 12 Months Ended |
Oct. 31, 2020 | |
Equity Method Investments and Joint Ventures [Abstract] | |
Schedule of summarized financial information | Summarized financial information for Red Iron is presented as follows (in thousands): For the Twelve Months Ended October 31 2020 2019 2018 Revenue $ 31,040 $ 47,569 $ 42,051 Interest and operating expenses, net (14,177) (21,011) (17,288) Net income $ 16,863 $ 26,558 $ 24,763 As of October 31 2020 2019 Finance receivables, net $ 386,781 $ 486,834 Other assets 2,929 3,733 Total assets $ 389,710 $ 490,567 Notes payable $ 332,838 $ 419,308 Other liabilities 12,994 17,594 Partners' capital 43,878 53,665 Total liabilities and partners' capital $ 389,710 $ 490,567 |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Oct. 31, 2020 | |
Income Tax Disclosure [Abstract] | |
Schedule of earnings before income taxes | Earnings before income taxes were as follows (in thousands): Fiscal Years Ended October 31 2020 2019 2018 Earnings before income taxes: U.S. $ 369,016 $ 283,730 $ 333,136 Foreign 38,054 38,403 39,261 Total earnings before income taxes $ 407,070 $ 322,133 $ 372,397 |
Schedule of reconciliation of the statutory federal income tax rate to the company's consolidated effective tax rate | A reconciliation of the statutory federal income tax rate to the company's effective tax rate is summarized as follows: Fiscal Years Ended October 31 2020 2019 2018 Statutory federal income tax rate 21.0 % 21.0 % 23.3 % Excess deduction for stock compensation (1.7) (3.7) (3.5) Domestic manufacturer's deduction — 0.1 (0.9) State and local income taxes, net of federal benefit 2.4 1.1 1.3 Foreign operations (0.6) (0.3) (0.5) Federal research tax credit (1.7) (1.5) (1.2) Foreign-derived intangible income — (1.3) — Remeasurement of deferred tax assets and liabilities — (0.1) 5.2 Deemed repatriation tax — (0.2) 3.6 Other, net (0.4) (0.2) (0.3) Effective tax rate 19.0 % 14.9 % 27.0 % |
Schedule of components of the provision for income taxes | Components of the company's provision for income taxes were as follows (in thousands): Fiscal Years Ended October 31 2020 2019 2018 Current provision: Federal $ 58,243 $ 37,415 $ 64,375 State 11,322 7,495 6,192 Foreign 5,534 6,846 7,087 Total current provision $ 75,099 $ 51,756 $ 77,654 Deferred provision (benefit): Federal $ 1,710 $ (37) $ 22,074 State 634 (3,205) 308 Foreign (74) (364) 422 Total deferred provision (benefit) 2,270 (3,606) 22,804 Total provision for income taxes $ 77,369 $ 48,150 $ 100,458 |
Schedule of tax effects of temporary differences that give rise to the net deferred income tax assets | The following table presents the tax effects of temporary differences that give rise to deferred income tax assets (liabilities), net (in thousands): October 31 2020 2019 Deferred income tax assets: Compensation and benefits $ 30,363 $ 27,969 Warranty and insurance 28,480 25,788 Lease liabilities 20,843 — Advertising and sales allowance 6,937 8,866 Inventory 4,937 4,005 Deferred revenue 2,910 4,373 Other 9,643 4,372 Valuation allowance (3,570) (3,199) Total deferred income tax assets $ 100,543 $ 72,174 Deferred income tax liabilities: Right-of-use assets $ (20,179) $ — Depreciation (49,018) (40,964) Amortization (95,315) (75,538) Total deferred income tax liabilities (164,512) (116,502) Deferred income tax liabilities, net $ (63,969) $ (44,328) |
Schedule of reconciliation of the beginning and ending amount of unrecognized tax benefits | A reconciliation of the beginning and ending amount of unrecognized tax benefits is as follows (in thousands): Unrecognized tax benefits as of October 31, 2019 $ 2,673 Increase as a result of tax positions taken during a prior period 166 Decrease as a result of tax positions taken during the current period (183) Increase as a result of tax positions taken during the current period 291 Reductions as a result of statute of limitations lapses (87) Unrecognized tax benefits as of October 31, 2020 $ 2,860 |
Stock-Based Compensation Plans
Stock-Based Compensation Plans (Tables) | 12 Months Ended |
Oct. 31, 2020 | |
Share-based Payment Arrangement [Abstract] | |
Schedule of compensation costs related to stock-based awards | Compensation costs related to stock-based compensation awards were as follows (in thousands): Fiscal Years Ended October 31 2020 2019 2018 Unrestricted common stock awards $ 693 $ 592 $ 530 Stock option awards 9,163 6,537 5,006 Performance share awards 2,123 3,070 3,628 Restricted stock unit awards 3,429 3,230 2,997 Total compensation cost for stock-based awards $ 15,408 $ 13,429 $ 12,161 Related tax benefit from stock-based awards $ 3,696 $ 3,200 $ 2,905 |
Schedule of weighted-average valuation assumptions of stock-based compensation | The table below illustrates the weighted-average valuation assumptions for options granted in the following fiscal periods: Fiscal Years Ended October 31 2020 2019 2018 Expected life of option in years 6.31 6.31 6.04 Expected stock price volatility 19.53 % 19.83 % 20.58 % Risk-free interest rate 1.73 % 2.77 % 2.21 % Expected dividend yield 0.99 % 1.18 % 0.97 % Per share weighted-average fair value at date of grant $ 15.23 $ 12.83 $ 14.25 |
Schedule of stock options activity | The table below presents stock option activity for fiscal 2020: Stock Option Awards Weighted-Average Exercise Price Weighted-Average Aggregate Intrinsic Outstanding as of October 31, 2019 2,848,120 $ 44.34 5.7 $ 93,392 Granted 536,890 76.07 Exercised (734,398) 31.10 Forfeited (4,009) 75.23 Outstanding as of October 31, 2020 2,646,603 $ 54.40 6.2 $ 73,305 Exercisable as of October 31, 2020 1,609,770 $ 45.22 4.8 $ 59,364 |
Schedule of total market value and the intrinsic value of options exercised | The table below presents the total market value of stock options exercised and the total intrinsic value of options exercised during the following fiscal years (in thousands): Fiscal Years Ended October 31 2020 2019 2018 Market value of stock options exercised $ 56,761 $ 92,352 $ 70,775 Intrinsic value of stock options exercised 1 $ 33,920 $ 62,288 $ 53,778 1 Intrinsic value is calculated as the amount by which the stock price at exercise date exceeded the option exercise price. |
Schedule of performance share awards granted | Factors related to the company's performance share awards are as follows (in thousands, except per award data): Fiscal Years Ended October 31 2020 2019 2018 Weighted-average fair value per award at date of grant $ 77.33 $ 59.58 $ 65.40 Fair value of performance share awards vested $ 6,271 $ 6,300 $ 8,419 |
Schedule of unvested performance share awards and the weighted average fair value at the date of grant | The table below presents fiscal 2020 activity for unvested performance share awards: Performance Shares Weighted-Average Fair Value at Date of Grant Unvested as of October 31, 2019 192,854 $ 59.47 Granted 81,655 77.33 Vested (82,782) 54.52 Forfeited (4,306) 61.27 Unvested as of October 31, 2020 187,421 $ 67.58 |
Schedule of restricted stock and restricted stock unit awards granted | Factors related to the company's restricted stock unit awards are as follows (in thousands, except per award data): Fiscal Years Ended October 31 2020 2019 2018 Weighted-average fair value per award at date of grant $ 74.55 $ 66.26 $ 63.24 Fair value of restricted stock units vested $ 3,410 $ 3,083 $ 4,888 |
Schedule of unvested restricted stock shares and the weighted average fair value at the date of grant | The table below presents fiscal 2020 activity for unvested restricted stock units: Restricted Stock Units Weighted-Average Fair Value at Date Unvested as of October 31, 2019 124,467 $ 65.30 Granted 27,161 74.55 Vested (48,212) 64.97 Forfeited (3,136) 70.40 Unvested as of October 31, 2020 100,280 $ 67.69 |
Stockholders' Equity (Tables)
Stockholders' Equity (Tables) | 12 Months Ended |
Oct. 31, 2020 | |
Stockholders' Equity Note [Abstract] | |
Schedule of components of accumulated other comprehensive loss ("AOCL"), net of tax, within the consolidated statements of stockholders' equity | The components of AOCL, net of tax, within the Consolidated Statements of Stockholders' Equity were as follows (in thousands): As of October 31 2020 2019 2018 Foreign currency translation adjustments $ 24,508 $ 31,025 $ 29,711 Pension and post-retirement benefits 5,106 4,861 561 Cash flow derivative instruments 4,648 (3,837) (6,335) Total accumulated other comprehensive loss $ 34,262 $ 32,049 $ 23,937 |
Schedule of components and activity of accumulated other comprehensive loss | The components and activity of AOCL, net of tax, were as follows (in thousands): Foreign Currency Translation Adjustments Pension Benefits Cash Flow Derivative Instruments Total Balance as of October 31, 2019 $ 31,025 $ 4,861 $ (3,837) $ 32,049 Other comprehensive (income) loss before reclassifications (6,517) 245 14,159 7,887 Amounts reclassified from AOCL — — (5,674) (5,674) Net current period other comprehensive (income) loss (6,517) 245 8,485 2,213 Balance as of October 31, 2020 $ 24,508 $ 5,106 $ 4,648 $ 34,262 Foreign Currency Translation Adjustments Pension and Post-Retirement Benefits Cash Flow Derivative Instruments Total Balance as of October 31, 2018 $ 29,711 $ 561 $ (6,335) $ 23,937 Other comprehensive (income) loss before reclassifications 1,314 4,300 (4,048) 1,566 Amounts reclassified from AOCL — — 6,546 6,546 Net current period other comprehensive loss 1,314 4,300 2,498 8,112 Balance as of October 31, 2019 $ 31,025 $ 4,861 $ (3,837) $ 32,049 |
Leases (Tables)
Leases (Tables) | 12 Months Ended |
Oct. 31, 2020 | |
Leases [Abstract] | |
Lease, cost | The following table presents the lease expense incurred on the company’s operating, short-term, and variable leases (in thousands): Fiscal Year Ended October 31 2020 Operating lease expense $ 19,637 Short-term lease expense 2,949 Variable lease expense 134 Total lease expense $ 22,720 The following table presents supplemental cash flow information related to the company's operating leases (in thousands): Fiscal Year Ended October 31 2020 Operating cash flows for amounts included in the measurement of lease liabilities $ 17,762 Right-of-use assets obtained in exchange for lease obligations $ 22,667 The following table presents other lease information related to the company's operating leases as of October 31, 2020: October 31, 2020 Weighted-average remaining lease term of operating leases in years 7.1 Weighted-average discount rate of operating leases 2.79 % |
Lessee, operating lease, liability, maturity | The following table reconciles the total undiscounted future cash flows based on the anticipated future minimum operating lease payments by fiscal year for the company's operating leases to the present value of operating lease liabilities recorded within the Consolidated Balance Sheets as of October 31, 2020 (in thousands): October 31, 2020 2021 $ 18,077 2022 15,391 2023 12,293 2024 10,936 2025 9,919 Thereafter 23,604 Total future minimum operating lease payments 90,220 Less: imputed interest 8,132 Present value of operating lease liabilities $ 82,088 |
Schedule of future minimum rental payments for operating leases | The following table presents future minimum operating lease payments by respective fiscal year for non-cancelable operating leases under the legacy lease accounting guidance at ASC Topic 840, Leases , as of October 31, 2019 (in thousands): October 31, 2019 2020 $ 17,135 2021 15,764 2022 12,806 2023 9,772 2024 8,863 Thereafter 18,732 Total future minimum lease payments $ 83,072 |
Derivative Instruments and He_2
Derivative Instruments and Hedging Activities (Tables) | 12 Months Ended |
Oct. 31, 2020 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Schedule of fair value of derivatives and consolidated balance sheet location | The following table presents the fair value and location of the company’s derivative instruments on the Consolidated Balance Sheets (in thousands): Fair Value as of October 31 2020 2019 Derivative assets: Derivatives designated as cash flow hedging instruments: Prepaid expenses and other current assets Forward currency contracts $ 802 $ 8,642 Derivatives not designated as cash flow hedging instruments: Prepaid expenses and other current assets Forward currency contracts 131 2,256 Total assets $ 933 $ 10,898 Derivative liabilities: Derivatives designated as cash flow hedging instruments: Accrued liabilities Forward currency contracts $ 2,687 $ — Derivatives not designated as cash flow hedging instruments: Accrued liabilities Forward currency contracts (203) 9 Total liabilities $ 2,484 $ 9 |
Schedule of effects of the master netting arrangements on the fair value of the company's derivative contracts that are recorded in the Consolidated Balance Sheets | The following table presents the effects of the master netting arrangements on the fair value of the company’s derivative instruments that are recorded on the Consolidated Balance Sheets (in thousands): Fair Value as of October 31 2020 2019 Derivative assets: Forward currency contracts: Gross amounts of recognized assets $ 1,139 $ 11,056 Gross liabilities offset in the Consolidated Balance Sheets (206) (158) Net amounts of assets presented in the Consolidated Balance Sheets $ 933 $ 10,898 Derivative liabilities: Forward currency contracts: Gross amounts of recognized liabilities $ (3,233) $ (9) Gross assets offset in the Consolidated Balance Sheets 749 — Net amounts of liabilities presented in the Consolidated Balance Sheets $ (2,484) $ (9) |
Schedule of impact of derivative instruments on consolidated statements of earnings for derivatives designated as cash flow hedging instruments | The following table presents the impact and location of the amounts reclassified from AOCL into net earnings on the Consolidated Statements of Earnings and the impact of derivative instruments on the Consolidated Statements of Comprehensive Income for the company's derivatives designated as cash flow hedging instruments (in thousands): Gain Reclassified from AOCL into Income (Loss) Recognized in OCI on Derivatives Fiscal Years Ended October 31 2020 2019 2020 2019 Derivatives designated as cash flow hedging instruments: Forward currency contracts: Net sales $ 5,023 $ 5,732 $ (8,232) $ (2,268) Cost of sales 651 814 (253) (230) Total derivatives designated as cash flow hedging instruments $ 5,674 $ 6,546 $ (8,485) $ (2,498) The following tables present the impact and location of derivative instruments on the Consolidated Statements of Earnings for the company’s derivatives designated as cash flow hedging instruments and the related components excluded from hedge effectiveness testing (in thousands): Gain Recognized in Earnings on Cash Flow Hedging Instruments Fiscal Year Ended October 31, 2020 Net Sales Cost of Sales Total Consolidated Statements of Earnings income (expense) amounts in which the effects of cash flow hedging instruments are recorded $ 3,378,810 $ (2,189,036) Gain on derivatives designated as cash flow hedging instruments: Forward currency contracts: Amount of gain reclassified from AOCL into earnings 5,023 651 Gain on components excluded from effectiveness testing recognized in earnings based on changes in fair value $ 3,229 $ 313 Gain Recognized in Earnings on Cash Flow Hedging Instruments Fiscal Year Ended October 31, 2019 Net Sales Cost of Sales Total Consolidated Statements of Earnings income (expense) amounts in which the effects of cash flow hedging instruments are recorded $ 3,138,084 $ (2,090,121) Gain on derivatives designated as cash flow hedging instruments: Forward currency contracts: Amount of gain reclassified from AOCL into earnings 5,732 814 Gain on components excluded from effectiveness testing recognized in earnings based on changes in fair value $ 5,358 $ 135 |
Derivatives not designated as hedging instruments | The following table presents the impact and location of derivative instruments on the Consolidated Statements of Earnings for the company’s derivatives not designated as cash flow hedging instruments (in thousands): Fiscal Years Ended October 31 2020 2019 Loss on derivative instruments not designated as cash flow hedging instruments: Forward currency contracts: Other income, net $ (5,792) $ (2,087) Total loss on derivatives not designated as cash flow hedging instruments $ (5,792) $ (2,087) |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 12 Months Ended |
Oct. 31, 2020 | |
Fair Value Disclosures [Abstract] | |
Schedule of assets and liabilities measured at fair value on a recurring basis | The following tables present, by level within the fair value hierarchy, the company's financial assets and liabilities that are measured at fair value on a recurring basis as of October 31, 2020 and 2019, according to the valuation technique utilized to determine their fair values (in thousands): Fair Value Measurements Using Inputs Considered as: October 31, 2020 Fair Value Level 1 Level 2 Level 3 Assets: Forward currency contracts $ 933 $ — $ 933 $ — Total assets $ 933 $ — $ 933 $ — Liabilities: Forward currency contracts $ 2,484 $ — $ 2,484 $ — Total liabilities $ 2,484 $ — $ 2,484 $ — Fair Value Measurements Using Inputs Considered as: October 31, 2019 Fair Value Level 1 Level 2 Level 3 Assets: Forward currency contracts $ 10,898 $ — $ 10,898 $ — Total assets $ 10,898 $ — $ 10,898 $ — Liabilities: Forward currency contracts $ 9 $ — $ 9 $ — Total liabilities $ 9 $ — $ 9 $ — |
Other Income, Net (Tables)
Other Income, Net (Tables) | 12 Months Ended |
Oct. 31, 2020 | |
Other Income and Expenses [Abstract] | |
Schedule of other income (expense) | The components of other income, net were as follows (in thousands): Fiscal Years Ended October 31 2020 2019 2018 Interest income $ 1,255 $ 2,753 $ 2,463 Retail financing revenue 1,080 1,178 1,232 Foreign currency exchange rate gain 2,034 1,558 1,127 Non-cash income from finance affiliate 7,663 11,948 11,143 Net periodic benefit income (loss) on defined benefit pension and post-retirement plans (1,344) 6,822 — Miscellaneous 3,181 1,680 2,443 Total other income, net $ 13,869 $ 25,939 $ 18,408 |
Quarterly Financial Data (Una_2
Quarterly Financial Data (Unaudited) (Tables) | 12 Months Ended |
Oct. 31, 2020 | |
Quarterly Financial Information Disclosure [Abstract] | |
Summary of quarterly financial data | Summarized quarterly financial data for fiscal 2020 and 2019 are as follows (dollars in thousands, except per share data): Quarter Fiscal Year Ended October 31, 2020 First Second Third Fourth Net sales $ 767,483 $ 929,398 $ 840,972 $ 840,957 Gross profit 288,088 306,717 294,574 300,395 Net earnings 70,091 98,446 88,968 72,196 Basic net earnings per share 1 0.65 0.92 0.83 0.67 Diluted net earnings per share 1 $ 0.65 $ 0.91 $ 0.82 $ 0.66 Quarter Fiscal Year Ended October 31, 2019 First Second 2 Third 2 Fourth Net sales $ 602,956 $ 962,036 $ 838,713 $ 734,379 Gross profit 215,617 321,298 265,981 245,067 Net earnings 59,540 115,570 60,607 38,266 Basic net earnings per share 1 0.56 1.08 0.57 0.36 Diluted net earnings per share 1 $ 0.55 $ 1.07 $ 0.56 $ 0.35 1 The summation of quarterly basic and diluted net earnings per share amounts may not equal the fiscal year basic and diluted net earnings per share amounts presented in the Consolidated Statements of Earnings due to differences in the number of weighted-average shares of common stock outstanding during the respective quarterly and fiscal year periods and rounding. 2 During fiscal 2019, CMW's financial position, results of operations, and cash flows were reported on a calendar month end. Accordingly, April 30, 2019 and July 31, 2019 were the calendar quarterly period end dates closest to the company's quarterly fiscal periods ended May 3, 2019 and August 2, 2019, respectively. This reporting period difference did not have material impact on the company's Consolidated Results of Operations during the company's second and third fiscal quarters of fiscal 2019. For the company's fiscal 2019 fourth quarter, the reporting period end for both CMW and the company was October 31, 2019. |
Summary of Significant Accoun_4
Summary of Significant Accounting Policies and Related Data - Basis of Presentation and Consolidation (Details) | 12 Months Ended |
Oct. 31, 2020segment | |
Accounting Policies [Abstract] | |
Number of reportable business segments | 2 |
Summary of Significant Accoun_5
Summary of Significant Accounting Policies and Related Data - Cash and Cash Equivalents (Details) - USD ($) $ in Millions | Oct. 31, 2020 | Oct. 31, 2019 |
Subsidiaries | International Countries | ||
Cash and Cash Equivalents [Line Items] | ||
Cash and cash equivalents | $ 106.3 | $ 97.5 |
Summary of Significant Accoun_6
Summary of Significant Accounting Policies and Related Data - Inventory Valuations (Details) - USD ($) $ in Thousands | Oct. 31, 2020 | Oct. 31, 2019 |
Inventory Disclosure [Abstract] | ||
Percentage of FIFO and weighted average cost inventory | 53.00% | 54.00% |
Inventory valuation adjustment | $ 37,900 | $ 40,300 |
Inventory, Net [Abstract] | ||
Raw materials and work in process | 168,759 | 179,967 |
Finished goods and service parts | 565,761 | 553,767 |
Total FIFO value | 734,520 | 733,734 |
Less: adjustment to LIFO value | 82,087 | 82,071 |
Total inventories, net | $ 652,433 | $ 651,663 |
Summary of Significant Accoun_7
Summary of Significant Accounting Policies and Related Data - Property and Depreciation (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Oct. 31, 2020 | Oct. 31, 2019 | Oct. 31, 2018 | |
Property and Depreciation | |||
Capitalized interest amount | $ 1,000 | $ 1,300 | $ 900 |
Property, plant and equipment, gross | 1,240,158 | 1,141,699 | |
Less: accumulated depreciation | 772,239 | 704,382 | |
Property, plant and equipment, net | 467,919 | 437,317 | 271,459 |
Depreciation expense | 76,108 | 69,314 | $ 53,484 |
Land and land improvements | |||
Property and Depreciation | |||
Property, plant and equipment, gross | 57,387 | 55,613 | |
Buildings and leasehold improvements | |||
Property and Depreciation | |||
Property, plant and equipment, gross | $ 301,848 | 276,556 | |
Buildings and leasehold improvements | Minimum | |||
Property and Depreciation | |||
Estimated useful life | 10 years | ||
Buildings and leasehold improvements | Maximum | |||
Property and Depreciation | |||
Estimated useful life | 40 years | ||
Machinery and equipment | |||
Property and Depreciation | |||
Property, plant and equipment, gross | $ 499,312 | 453,314 | |
Machinery and equipment | Minimum | |||
Property and Depreciation | |||
Estimated useful life | 2 years | ||
Machinery and equipment | Maximum | |||
Property and Depreciation | |||
Estimated useful life | 15 years | ||
Tooling | |||
Property and Depreciation | |||
Property, plant and equipment, gross | $ 231,142 | 226,870 | |
Tooling | Minimum | |||
Property and Depreciation | |||
Estimated useful life | 3 years | ||
Tooling | Maximum | |||
Property and Depreciation | |||
Estimated useful life | 5 years | ||
Computer hardware and software | |||
Property and Depreciation | |||
Property, plant and equipment, gross | $ 102,312 | 94,409 | |
Computer hardware and software | Minimum | |||
Property and Depreciation | |||
Estimated useful life | 2 years | ||
Computer hardware and software | Maximum | |||
Property and Depreciation | |||
Estimated useful life | 5 years | ||
Construction in process | |||
Property and Depreciation | |||
Property, plant and equipment, gross | $ 48,157 | $ 34,937 |
Summary of Significant Accoun_8
Summary of Significant Accounting Policies and Related Data - Goodwill and Indefinite-Life Intangible Assets (Details) | 12 Months Ended | ||
Oct. 31, 2020USD ($)segmentreporting_unit | Oct. 31, 2019USD ($) | Oct. 31, 2018USD ($) | |
Accounting Policies [Abstract] | |||
Number of reporting units tested for impairment of goodwill | reporting_unit | 11 | ||
Number of operating segments | segment | 11 | ||
Number of reporting units containing goodwill | reporting_unit | 9 | ||
Goodwill, impairment loss | $ | $ 0 | $ 0 | $ 0 |
Impairment of intangible assets, indefinite-lived (excluding goodwill) | $ | $ 0 | $ 0 | $ 0 |
Summary of Significant Accoun_9
Summary of Significant Accounting Policies and Related Data - Other Long-Lived Assets (Details) - USD ($) | 12 Months Ended | ||
Oct. 31, 2020 | Oct. 31, 2019 | Oct. 31, 2018 | |
Indefinite-lived Intangible Assets [Line Items] | |||
Estimated useful life (years) | 15 years 6 months | 15 years 6 months | |
Impairment of long-lived assets held-for-use | $ 0 | $ 0 | $ 0 |
Minimum | |||
Indefinite-lived Intangible Assets [Line Items] | |||
Estimated useful life (years) | 1 year | ||
Maximum | |||
Indefinite-lived Intangible Assets [Line Items] | |||
Estimated useful life (years) | 20 years |
Summary of Significant Accou_10
Summary of Significant Accounting Policies and Related Data - Accounts Payable (Details) - USD ($) $ in Millions | Oct. 31, 2020 | Oct. 31, 2019 |
Accounting Policies [Abstract] | ||
Outstanding payment obligations placed on the accounts payable tracking system | $ 63.5 | $ 46.7 |
Summary of Significant Accou_11
Summary of Significant Accounting Policies and Related Data - Accrued Warranties (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Oct. 31, 2020 | Oct. 31, 2019 | Oct. 31, 2018 | |
Movement in Standard Product Warranty Accrual [Roll Forward] | |||
Beginning balance | $ 96,604 | $ 76,214 | $ 74,155 |
Warranty provisions | 60,273 | 57,277 | 49,160 |
Acquisitions | 2,557 | 18,418 | 0 |
Warranty claims | (67,241) | (58,878) | (45,662) |
Changes in estimates | 14,928 | 3,573 | (1,439) |
Ending balance | $ 107,121 | $ 96,604 | $ 76,214 |
Summary of Significant Accou_12
Summary of Significant Accounting Policies and Related Data - Debt Issuance Costs (Details) - USD ($) | 12 Months Ended | |
Oct. 31, 2020 | Oct. 31, 2019 | |
Debt Instrument [Line Items] | ||
Maximum borrowing capacity under credit facility | $ 13,400,000 | $ 13,300,000 |
Debt issuance costs, net | 3,900,000 | $ 4,500,000 |
Line of Credit | ||
Debt Instrument [Line Items] | ||
Maximum borrowing capacity under credit facility | $ 600,000,000 | |
Debt instrument, term (in years) | 5 years |
Summary of Significant Accou_13
Summary of Significant Accounting Policies and Related Data - Revenue Recognition (Details) - USD ($) $ in Millions | Oct. 31, 2020 | Oct. 31, 2019 |
Accounting Policies [Abstract] | ||
Consignment inventory amount | $ 24.6 | $ 19.9 |
Summary of Significant Accou_14
Summary of Significant Accounting Policies and Related Data - Cost of Financing Distributor / Dealer Inventory (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Oct. 31, 2020 | Oct. 31, 2019 | Oct. 31, 2018 | |
Accounting Policies [Abstract] | |||
Financing costs for distributor and dealer inventories | $ 24.1 | $ 44.5 | $ 37.1 |
Summary of Significant Accou_15
Summary of Significant Accounting Policies and Related Data - Advertising (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Oct. 31, 2020 | Oct. 31, 2019 | Oct. 31, 2018 | |
Accounting Policies [Abstract] | |||
Advertising costs | $ 50.3 | $ 43.5 | $ 46.4 |
Summary of Significant Accou_16
Summary of Significant Accounting Policies and Related Data - Engineering and Research (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Oct. 31, 2020 | Oct. 31, 2019 | Oct. 31, 2018 | |
Accounting Policies [Abstract] | |||
Engineering and research costs | $ 124.1 | $ 109.1 | $ 83.5 |
Summary of Significant Accou_17
Summary of Significant Accounting Policies and Related Data - Net Earnings Per Share (Details) - shares shares in Thousands | 12 Months Ended | ||
Oct. 31, 2020 | Oct. 31, 2019 | Oct. 31, 2018 | |
Basic | |||
Weighted-average number of shares of common stock (in shares) | 107,647 | 106,762 | 106,356 |
Assumed issuance of contingent shares (in shares) | 11 | 11 | 13 |
Weighted-average number of shares of common stock and assumed issuance of contingent shares (in shares) | 107,658 | 106,773 | 106,369 |
Diluted | |||
Weighted-average number of shares of common stock and assumed issuance of contingent shares (in shares) | 107,658 | 106,773 | 106,369 |
Effect of dilutive securities (in shares) | 1,005 | 1,317 | 2,288 |
Weighted-average number of shares of common stock, assumed issuance of contingent shares, and effect of dilutive securities (in shares) | 108,663 | 108,090 | 108,657 |
Antidilutive securities excluded from computation of earnings per share, amount (in shares) | 447,032 | 716,343 | 424,089 |
Summary of Significant Accou_18
Summary of Significant Accounting Policies and Related Data - New Accounting Pronouncements Not Yet Adopted (Details) - USD ($) $ in Thousands | Oct. 31, 2020 | Nov. 01, 2019 |
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||
Operating lease, right-of-use asset | $ 78,752 | |
Present value of operating lease liabilities | $ 82,088 | |
Accounting Standards Update 2016-02 | ||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||
Operating lease, right-of-use asset | $ 78,100 | |
Present value of operating lease liabilities | $ 77,100 |
Business Combinations - Narrati
Business Combinations - Narrative (Details) - USD ($) | Mar. 02, 2020 | Apr. 01, 2019 | Jul. 31, 2020 | May 01, 2020 | Oct. 31, 2019 | Oct. 31, 2019 | Oct. 31, 2020 | Oct. 31, 2021 | Oct. 31, 2020 | Oct. 31, 2019 | Oct. 31, 2018 |
Business Acquisition [Line Items] | |||||||||||
Business combination, consideration transferred, holdback expired | $ 4,500,000 | ||||||||||
Goodwill | $ 362,253,000 | $ 362,253,000 | $ 424,075,000 | $ 424,075,000 | $ 362,253,000 | $ 225,290,000 | |||||
Business acquisition, goodwill, expected tax deductible amount | $ 0 | 0 | |||||||||
Purchase price allocation adjustment | $ (866,000) | ||||||||||
Estimated useful life (years) | 15 years 6 months | 15 years 6 months | |||||||||
Trade names | |||||||||||
Business Acquisition [Line Items] | |||||||||||
Estimated useful life (years) | 15 years 4 months 24 days | 15 years 4 months 24 days | |||||||||
Developed technology | |||||||||||
Business Acquisition [Line Items] | |||||||||||
Estimated useful life (years) | 7 years 7 months 6 days | 7 years 7 months 6 days | |||||||||
Forecast | |||||||||||
Business Acquisition [Line Items] | |||||||||||
Business combination, consideration transferred, holdback | $ 25,000,000 | ||||||||||
Venture Products, Inc Affiliate | |||||||||||
Business Acquisition [Line Items] | |||||||||||
Payments to acquire businesses, gross | $ 136,400,000 | ||||||||||
Business combination, consideration transferred, holdback | 29,500,000 | ||||||||||
Total purchase price | 163,225,000 | $ 163,200,000 | |||||||||
Business combination, acquisition related costs | $ 600,000 | ||||||||||
Goodwill | 62,252,000 | ||||||||||
Other intangible assets | 75,300,000 | ||||||||||
Business combination, pro forma information, revenue of acquiree since acquisition date, actual | 58,300,000 | ||||||||||
Estimated useful life (years) | 16 years | ||||||||||
Venture Products, Inc Affiliate | Previously Reported | |||||||||||
Business Acquisition [Line Items] | |||||||||||
Preliminary purchase price | $ 165,900,000 | ||||||||||
Charles Machine Works, Inc | |||||||||||
Business Acquisition [Line Items] | |||||||||||
Total purchase price | 685,000,000 | 684,973,000 | |||||||||
Business combination, acquisition related costs | $ 10,200,000 | ||||||||||
Goodwill | $ 134,657,000 | ||||||||||
Other intangible assets | 264,200,000 | $ 264,200,000 | $ 264,200,000 | ||||||||
Purchase price allocation adjustment | $ (900,000) | ||||||||||
Estimated useful life (years) | 16 years 7 months 6 days | ||||||||||
Charles Machine Works, Inc | Trade names | |||||||||||
Business Acquisition [Line Items] | |||||||||||
Other intangible assets | 5,200,000 | ||||||||||
Estimated useful life (years) | 20 years | ||||||||||
Charles Machine Works, Inc | Customer-related | |||||||||||
Business Acquisition [Line Items] | |||||||||||
Other intangible assets | 130,800,000 | ||||||||||
Estimated useful life (years) | 18 years 3 months 18 days | ||||||||||
Charles Machine Works, Inc | Developed technology | |||||||||||
Business Acquisition [Line Items] | |||||||||||
Other intangible assets | 20,900,000 | ||||||||||
Estimated useful life (years) | 7 years 9 months 18 days | ||||||||||
Charles Machine Works, Inc | Backlog | |||||||||||
Business Acquisition [Line Items] | |||||||||||
Other intangible assets | 3,590,000 | ||||||||||
Estimated useful life (years) | 6 months | ||||||||||
Charles Machine Works, Inc | Previously Reported | |||||||||||
Business Acquisition [Line Items] | |||||||||||
Preliminary purchase price | $ 679,300,000 | ||||||||||
Professional | |||||||||||
Business Acquisition [Line Items] | |||||||||||
Goodwill | 350,300,000 | 350,300,000 | 412,100,000 | $ 412,100,000 | 350,300,000 | ||||||
Operating Segments | Professional | |||||||||||
Business Acquisition [Line Items] | |||||||||||
Goodwill | 350,250,000 | 350,250,000 | $ 412,061,000 | 412,061,000 | 350,250,000 | $ 214,827,000 | |||||
Purchase price allocation adjustment | $ (866,000) | ||||||||||
Operating Segments | Professional | Charles Machine Works, Inc | |||||||||||
Business Acquisition [Line Items] | |||||||||||
Goodwill | $ 350,300,000 | $ 350,300,000 | $ 350,300,000 |
Business Combinations - Allocat
Business Combinations - Allocation of Preliminary Purchase Price, Venture Products (Details) - USD ($) $ in Thousands | Mar. 02, 2020 | Jul. 31, 2020 | Oct. 31, 2020 | Oct. 31, 2019 | Oct. 31, 2018 |
Business Acquisition [Line Items] | |||||
Goodwill | $ 424,075 | $ 362,253 | $ 225,290 | ||
Venture Products, Inc Affiliate | |||||
Business Acquisition [Line Items] | |||||
Cash and cash equivalents | $ 3,476 | ||||
Receivables | 6,342 | ||||
Inventories | 23,000 | ||||
Prepaid expenses and other current assets | 239 | ||||
Property, plant and equipment | 26,976 | ||||
Goodwill | 62,252 | ||||
Other intangible assets: | 75,300 | ||||
Accounts payable | (4,075) | ||||
Accrued liabilities | (5,959) | ||||
Deferred income tax liabilities | (20,850) | ||||
Total fair value of net assets acquired | 166,701 | ||||
Cash and cash equivalents | (3,476) | ||||
Total purchase price | $ 163,225 | $ 163,200 |
Business Combinations - Summary
Business Combinations - Summary of Intangible Assets, Venture Products (Details) - USD ($) $ in Thousands | 8 Months Ended | 12 Months Ended | |
Oct. 31, 2020 | Oct. 31, 2020 | Oct. 31, 2019 | |
Business Acquisition [Line Items] | |||
Estimated useful life (years) | 15 years 6 months | 15 years 6 months | |
Gross Carrying Amount | $ 328,698 | $ 328,698 | $ 309,285 |
Accumulated Amortization | (110,905) | (110,905) | (91,223) |
Finite-lived intangible assets, net | 217,793 | 217,793 | 218,062 |
Total other intangible assets, gross | 519,210 | 519,210 | 443,597 |
Total other intangible assets, net | $ 408,305 | 408,305 | $ 352,374 |
Venture Products, Inc Affiliate | |||
Business Acquisition [Line Items] | |||
Estimated useful life (years) | 16 years | ||
Gross Carrying Amount | $ 19,100 | 19,100 | |
Accumulated Amortization | (796) | (796) | |
Finite-lived intangible assets, net | 18,304 | 18,304 | |
Total other intangible assets, gross | 75,300 | 75,300 | |
Total other intangible assets, net | 74,504 | 74,504 | |
Trade names | Venture Products, Inc Affiliate | |||
Business Acquisition [Line Items] | |||
Indefinite-lived - trade name | $ 56,200 | $ 56,200 |
Business Combinations - Summa_2
Business Combinations - Summary of Purchase Price Allocation (Details) - USD ($) $ in Thousands | 3 Months Ended | 7 Months Ended | |||
Oct. 31, 2019 | Oct. 31, 2019 | Oct. 31, 2020 | Apr. 01, 2019 | Oct. 31, 2018 | |
Business Acquisition [Line Items] | |||||
Goodwill | $ 362,253 | $ 362,253 | $ 424,075 | $ 225,290 | |
Charles Machine Works, Inc | |||||
Business Acquisition [Line Items] | |||||
Cash and cash equivalents | $ 16,341 | ||||
Receivables | 65,674 | ||||
Inventories | 241,429 | ||||
Prepaid expenses and other current assets | 8,050 | ||||
Property, plant and equipment | 142,779 | ||||
Goodwill | 134,657 | ||||
Other intangible assets: | $ 264,200 | 264,200 | |||
Other long-term assets | 7,971 | ||||
Accounts payable | (35,892) | ||||
Accrued liabilities | (51,943) | ||||
Deferred income tax liabilities | (85,277) | ||||
Other long-term liabilities | (6,665) | ||||
Total fair value of net assets acquired | 701,314 | ||||
Cash and cash equivalents | (16,341) | ||||
Total purchase price | $ 685,000 | $ 684,973 | |||
Charles Machine Works, Inc | Trade names | |||||
Business Acquisition [Line Items] | |||||
Other intangible assets: | 103,700 | ||||
Charles Machine Works, Inc | Customer-related | |||||
Business Acquisition [Line Items] | |||||
Other intangible assets: | 130,800 | ||||
Charles Machine Works, Inc | Developed technology | |||||
Business Acquisition [Line Items] | |||||
Other intangible assets: | 20,900 | ||||
Charles Machine Works, Inc | Trade names | |||||
Business Acquisition [Line Items] | |||||
Other intangible assets: | 5,200 | ||||
Charles Machine Works, Inc | Backlog | |||||
Business Acquisition [Line Items] | |||||
Other intangible assets: | $ 3,590 |
Business Combinations - Pro For
Business Combinations - Pro Forma (Details) - Charles Machine Works, Inc - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | |
Oct. 31, 2019 | Oct. 31, 2018 | |
Business Acquisition [Line Items] | ||
Net sales | $ 3,437,335 | $ 3,332,636 |
Net earnings | $ 363,452 | $ 276,722 |
Basic net earnings per share of common stock (in dollars per share) | $ 3.40 | $ 2.60 |
Diluted net earnings per share of common stock (in dollars per share) | $ 3.36 | $ 2.55 |
Defined benefit plan, net periodic benefit cost (credit), gain (loss) due to settlement | $ 45,800 | |
Defined benefit plan, net periodic benefit cost (credit), gain (loss) due to settlement, per share, diluted (in dollars per share) | $ 0.42 |
Segment Data - Narrative (Detai
Segment Data - Narrative (Details) | 12 Months Ended |
Oct. 31, 2020segment | |
Segment Reporting Information [Line Items] | |
Number of operating segments | 11 |
Number of reportable business segments | 2 |
Segment Data - Summarized Finan
Segment Data - Summarized Financial Information (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Oct. 31, 2020 | Jul. 31, 2020 | May 01, 2020 | Jan. 31, 2020 | Oct. 31, 2019 | Aug. 02, 2019 | May 03, 2019 | Feb. 01, 2019 | Oct. 31, 2020 | Oct. 31, 2019 | Oct. 31, 2018 | |
Segment Reporting Information [Line Items] | |||||||||||
Net sales | $ 840,957 | $ 840,972 | $ 929,398 | $ 767,483 | $ 734,379 | $ 838,713 | $ 962,036 | $ 602,956 | $ 3,378,810 | $ 3,138,084 | $ 2,618,650 |
Earnings (loss) before income taxes | 407,070 | 322,133 | 372,397 | ||||||||
Total assets | 2,853,228 | 2,330,547 | 2,853,228 | 2,330,547 | 1,570,984 | ||||||
Capital expenditures | 78,068 | 92,881 | 90,124 | ||||||||
Depreciation and amortization | 95,615 | 87,698 | 61,277 | ||||||||
Operating Segments | Professional | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Net sales | 2,523,452 | 2,443,448 | 1,946,999 | ||||||||
Intersegment gross sales (eliminations) | 46,703 | 59,453 | 29,798 | ||||||||
Earnings (loss) before income taxes | 426,560 | 380,914 | 399,806 | ||||||||
Total assets | 1,940,844 | 1,592,065 | 1,940,844 | 1,592,065 | 916,106 | ||||||
Capital expenditures | 49,975 | 57,246 | 58,109 | ||||||||
Depreciation and amortization | 70,460 | 63,885 | 38,585 | ||||||||
Operating Segments | Residential | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Net sales | 820,745 | 661,274 | 654,413 | ||||||||
Intersegment gross sales (eliminations) | 80 | 310 | 312 | ||||||||
Earnings (loss) before income taxes | 113,669 | 65,151 | 64,807 | ||||||||
Total assets | 282,061 | 430,495 | 282,061 | 430,495 | 199,273 | ||||||
Capital expenditures | 13,669 | 16,970 | 16,014 | ||||||||
Depreciation and amortization | 12,607 | 11,897 | 9,999 | ||||||||
Other | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Net sales | 34,613 | 33,362 | 17,238 | ||||||||
Intersegment gross sales (eliminations) | (46,783) | (59,763) | (30,110) | ||||||||
Earnings (loss) before income taxes | (133,159) | (123,932) | (92,216) | ||||||||
Total assets | $ 630,323 | $ 307,987 | 630,323 | 307,987 | 455,605 | ||||||
Capital expenditures | 14,424 | 18,665 | 16,001 | ||||||||
Depreciation and amortization | $ 12,548 | $ 11,916 | $ 12,693 |
Segment Data - Other Segment Op
Segment Data - Other Segment Operating Loss Before Income Taxes (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Oct. 31, 2020 | Oct. 31, 2019 | Oct. 31, 2018 | |
Segment Reporting Information [Line Items] | |||
Interest expense | $ (33,156) | $ (28,835) | $ (19,096) |
Earnings from wholly-owned domestic distribution companies and other income, net | 13,869 | 25,939 | 18,408 |
Earnings before income taxes | 407,070 | 322,133 | 372,397 |
Other | |||
Segment Reporting Information [Line Items] | |||
Corporate expenses | (108,396) | (124,422) | (92,541) |
Interest expense | (33,156) | (28,835) | (19,096) |
Earnings from wholly-owned domestic distribution companies and other income, net | 8,393 | 29,325 | 19,421 |
Earnings before income taxes | $ (133,159) | $ (123,932) | $ (92,216) |
Segment Data - Net Sales (Detai
Segment Data - Net Sales (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Oct. 31, 2020 | Jul. 31, 2020 | May 01, 2020 | Jan. 31, 2020 | Oct. 31, 2019 | Aug. 02, 2019 | May 03, 2019 | Feb. 01, 2019 | Oct. 31, 2020 | Oct. 31, 2019 | Oct. 31, 2018 | |
Net sales for groups of similar products and services | |||||||||||
Net sales | $ 840,957 | $ 840,972 | $ 929,398 | $ 767,483 | $ 734,379 | $ 838,713 | $ 962,036 | $ 602,956 | $ 3,378,810 | $ 3,138,084 | $ 2,618,650 |
Equipment | |||||||||||
Net sales for groups of similar products and services | |||||||||||
Net sales | 2,985,295 | 2,747,935 | 2,210,047 | ||||||||
Irrigation and lighting | |||||||||||
Net sales for groups of similar products and services | |||||||||||
Net sales | $ 393,515 | $ 390,149 | $ 408,603 |
Segment Data - Geographic Data
Segment Data - Geographic Data (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Oct. 31, 2020 | Jul. 31, 2020 | May 01, 2020 | Jan. 31, 2020 | Oct. 31, 2019 | Aug. 02, 2019 | May 03, 2019 | Feb. 01, 2019 | Oct. 31, 2020 | Oct. 31, 2019 | Oct. 31, 2018 | |
Geographic Data | |||||||||||
Net sales | $ 840,957 | $ 840,972 | $ 929,398 | $ 767,483 | $ 734,379 | $ 838,713 | $ 962,036 | $ 602,956 | $ 3,378,810 | $ 3,138,084 | $ 2,618,650 |
Long-lived assets | 467,919 | 437,317 | 467,919 | 437,317 | 271,459 | ||||||
United States | |||||||||||
Geographic Data | |||||||||||
Net sales | 2,700,694 | 2,413,153 | 1,975,562 | ||||||||
Long-lived assets | 426,378 | 395,937 | 426,378 | 395,937 | 230,246 | ||||||
International Countries | |||||||||||
Geographic Data | |||||||||||
Net sales | 678,116 | 724,931 | 643,088 | ||||||||
Long-lived assets | $ 41,541 | $ 41,380 | $ 41,541 | $ 41,380 | $ 41,213 |
Revenue - Disaggregation (Detai
Revenue - Disaggregation (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Oct. 31, 2020 | Jul. 31, 2020 | May 01, 2020 | Jan. 31, 2020 | Oct. 31, 2019 | Aug. 02, 2019 | May 03, 2019 | Feb. 01, 2019 | Oct. 31, 2020 | Oct. 31, 2019 | Oct. 31, 2018 | |
Disaggregation of Revenue [Line Items] | |||||||||||
Net sales | $ 840,957 | $ 840,972 | $ 929,398 | $ 767,483 | $ 734,379 | $ 838,713 | $ 962,036 | $ 602,956 | $ 3,378,810 | $ 3,138,084 | $ 2,618,650 |
United States | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Net sales | 2,700,694 | 2,413,153 | 1,975,562 | ||||||||
International Countries | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Net sales | 678,116 | 724,931 | 643,088 | ||||||||
Equipment | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Net sales | 2,985,295 | 2,747,935 | 2,210,047 | ||||||||
Irrigation | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Net sales | 393,515 | 390,149 | 408,603 | ||||||||
Operating Segments | Professional | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Net sales | 2,523,452 | 2,443,448 | 1,946,999 | ||||||||
Operating Segments | Professional | United States | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Net sales | 1,976,690 | 1,853,054 | 1,441,815 | ||||||||
Operating Segments | Professional | International Countries | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Net sales | 546,762 | 590,394 | 505,184 | ||||||||
Operating Segments | Professional | Equipment | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Net sales | 2,175,794 | 2,097,965 | 1,582,024 | ||||||||
Operating Segments | Professional | Irrigation | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Net sales | 347,658 | 345,483 | 364,975 | ||||||||
Operating Segments | Residential | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Net sales | 820,745 | 661,274 | 654,413 | ||||||||
Operating Segments | Residential | United States | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Net sales | 689,391 | 526,737 | 516,509 | ||||||||
Operating Segments | Residential | International Countries | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Net sales | 131,354 | 134,537 | 137,904 | ||||||||
Operating Segments | Residential | Equipment | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Net sales | 787,716 | 628,521 | 617,827 | ||||||||
Operating Segments | Residential | Irrigation | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Net sales | 33,029 | 32,753 | 36,586 | ||||||||
Other | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Net sales | 34,613 | 33,362 | 17,238 | ||||||||
Other | United States | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Net sales | 34,613 | 33,362 | 17,238 | ||||||||
Other | International Countries | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Net sales | 0 | 0 | 0 | ||||||||
Other | Equipment | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Net sales | 21,785 | 21,449 | 10,196 | ||||||||
Other | Irrigation | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Net sales | $ 12,828 | $ 11,913 | $ 7,042 |
Revenue - Narrative (Details)
Revenue - Narrative (Details) - USD ($) $ in Millions | 12 Months Ended | |
Oct. 31, 2020 | Oct. 31, 2019 | |
Disaggregation of Revenue [Line Items] | ||
Contract with customer, liability | $ 21.9 | $ 22 |
Contract with customer, liability, revenue recognized | $ 10.6 | |
Minimum | Product Revenue | ||
Disaggregation of Revenue [Line Items] | ||
Contract with customer, contract period | 30 days | |
Minimum | Service Revenue | ||
Disaggregation of Revenue [Line Items] | ||
Contract with customer, contract period | 12 months | |
Minimum | Warranty Revenue | ||
Disaggregation of Revenue [Line Items] | ||
Contract with customer, contract period | 12 months | |
Maximum | Product Revenue | ||
Disaggregation of Revenue [Line Items] | ||
Contract with customer, contract period | 120 days | |
Maximum | Service Revenue | ||
Disaggregation of Revenue [Line Items] | ||
Contract with customer, contract period | 36 months | |
Maximum | Warranty Revenue | ||
Disaggregation of Revenue [Line Items] | ||
Contract with customer, contract period | 24 months |
Revenue - Performance Obligatio
Revenue - Performance Obligation (Details) $ in Millions | Oct. 31, 2020USD ($) |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2020-11-01 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Revenue, remaining performance obligation, amount | $ 10.1 |
Revenue, remaining performance obligation, expected timing of satisfaction, period | 1 year |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2021-11-01 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Revenue, remaining performance obligation, amount | $ 11.8 |
Revenue, remaining performance obligation, expected timing of satisfaction, period |
Goodwill and Other Intangible_3
Goodwill and Other Intangible Assets - Narrative (Details) - USD ($) $ in Thousands | 12 Months Ended | ||||
Oct. 31, 2020 | Oct. 31, 2019 | Oct. 31, 2018 | Mar. 02, 2020 | Apr. 01, 2019 | |
Business Acquisition [Line Items] | |||||
Goodwill | $ 424,075 | $ 362,253 | $ 225,290 | ||
Amortization expense for intangible assets | 19,500 | $ 18,400 | $ 7,300 | ||
Finite-Lived Intangible Assets, Net, Amortization Expense, Fiscal Year Maturity [Abstract] | |||||
Fiscal 2021 | 19,500 | ||||
Fiscal 2022 | 18,300 | ||||
Fiscal 2023 | 16,500 | ||||
Fiscal 2024 | 15,500 | ||||
Fiscal 2025 | 13,900 | ||||
After fiscal 2025 | 134,100 | ||||
Venture Products, Inc Affiliate | |||||
Business Acquisition [Line Items] | |||||
Goodwill | $ 62,252 | ||||
Other intangible assets: | $ 75,300 | ||||
Charles Machine Works, Inc | |||||
Business Acquisition [Line Items] | |||||
Goodwill | $ 134,657 | ||||
Other intangible assets: | $ 264,200 | $ 264,200 |
Goodwill and Other Intangible_4
Goodwill and Other Intangible Assets - Changes in Net Carrying Amount of Goodwill (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Oct. 31, 2020 | Oct. 31, 2019 | |
Changes in the net carrying amount of goodwill | ||
Goodwill as of the beginning of the fiscal period | $ 362,253 | $ 225,290 |
Goodwill acquired | 62,252 | 137,058 |
Purchase price allocation adjustment | (866) | |
Translation adjustments | 436 | (95) |
Goodwill as of the end of the fiscal period | 424,075 | 362,253 |
Professional | ||
Changes in the net carrying amount of goodwill | ||
Goodwill as of the beginning of the fiscal period | 350,300 | |
Goodwill as of the end of the fiscal period | 412,100 | 350,300 |
Other | ||
Changes in the net carrying amount of goodwill | ||
Goodwill as of the beginning of the fiscal period | 1,534 | 0 |
Goodwill acquired | 0 | 1,534 |
Purchase price allocation adjustment | 0 | |
Translation adjustments | 0 | 0 |
Goodwill as of the end of the fiscal period | 1,534 | 1,534 |
Operating Segments | Professional | ||
Changes in the net carrying amount of goodwill | ||
Goodwill as of the beginning of the fiscal period | 350,250 | 214,827 |
Goodwill acquired | 62,252 | 135,524 |
Purchase price allocation adjustment | (866) | |
Translation adjustments | 425 | (101) |
Goodwill as of the end of the fiscal period | 412,061 | 350,250 |
Operating Segments | Residential | ||
Changes in the net carrying amount of goodwill | ||
Goodwill as of the beginning of the fiscal period | 10,469 | 10,463 |
Goodwill acquired | 0 | 0 |
Purchase price allocation adjustment | 0 | |
Translation adjustments | 11 | 6 |
Goodwill as of the end of the fiscal period | $ 10,480 | $ 10,469 |
Goodwill and Other Intangible_5
Goodwill and Other Intangible Assets - Components of Other Intangible Assets (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Oct. 31, 2020 | Oct. 31, 2019 | |
Other Intangible Assets | ||
Gross Carrying Amount | $ 328,698 | $ 309,285 |
Accumulated Amortization | (110,905) | (91,223) |
Net | 217,793 | 218,062 |
Indefinite-lived - trade names | 190,512 | 134,312 |
Total other intangible assets, gross | 519,210 | 443,597 |
Total other intangible assets, net | $ 408,305 | $ 352,374 |
Estimated useful life (years) | 15 years 6 months | 15 years 6 months |
Patents | ||
Other Intangible Assets | ||
Gross Carrying Amount | $ 18,257 | $ 18,230 |
Accumulated Amortization | (13,919) | (13,102) |
Net | $ 4,338 | $ 5,128 |
Estimated useful life (years) | 9 years 10 months 24 days | 9 years 10 months 24 days |
Non-compete agreements | ||
Other Intangible Assets | ||
Gross Carrying Amount | $ 6,892 | $ 6,868 |
Accumulated Amortization | (6,831) | (6,786) |
Net | $ 61 | $ 82 |
Estimated useful life (years) | 5 years 6 months | 5 years 6 months |
Customer-related | ||
Other Intangible Assets | ||
Gross Carrying Amount | $ 239,634 | $ 220,390 |
Accumulated Amortization | (48,005) | (33,547) |
Net | $ 191,629 | $ 186,843 |
Estimated useful life (years) | 18 years 2 months 12 days | 18 years 4 months 24 days |
Developed technology | ||
Other Intangible Assets | ||
Gross Carrying Amount | $ 51,995 | $ 51,911 |
Accumulated Amortization | (35,208) | (31,289) |
Net | $ 16,787 | $ 20,622 |
Estimated useful life (years) | 7 years 7 months 6 days | 7 years 7 months 6 days |
Trade names | ||
Other Intangible Assets | ||
Gross Carrying Amount | $ 7,530 | $ 7,496 |
Accumulated Amortization | (2,552) | (2,109) |
Net | $ 4,978 | $ 5,387 |
Estimated useful life (years) | 15 years 4 months 24 days | 15 years 4 months 24 days |
Backlog and other | ||
Other Intangible Assets | ||
Gross Carrying Amount | $ 4,390 | $ 4,390 |
Accumulated Amortization | (4,390) | (4,390) |
Net | $ 0 | $ 0 |
Estimated useful life (years) | 7 months 6 days | 7 months 6 days |
Indebtedness - Summary of Long
Indebtedness - Summary of Long Term Debt (Details) - USD ($) | Mar. 30, 2020 | Mar. 31, 2019 | Jun. 30, 1997 | Oct. 31, 2020 | Oct. 31, 2019 | Jun. 27, 2019 | Apr. 30, 2019 |
Debt Instrument [Line Items] | |||||||
Less: unamortized discounts, debt issuance costs, and deferred charges | $ 2,855,000 | $ 3,103,000 | |||||
Total long-term debt | 791,123,000 | 700,813,000 | |||||
Less: current portion of long-term debt | 99,873,000 | 79,914,000 | |||||
Long-term debt, less current portion | 691,250,000 | 620,899,000 | |||||
Line of Credit | |||||||
Debt Instrument [Line Items] | |||||||
Carrying amount of long-term debt | $ 0 | 0 | |||||
Debt instrument, term (in years) | 5 years | ||||||
$500.0 million term loan | $200 million term loan | |||||||
Debt Instrument [Line Items] | |||||||
Carrying amount of long-term debt | $ 100,000,000 | 100,000,000 | |||||
Aggregate principal amount of notes issued | $ 200,000,000 | 200,000,000 | |||||
Debt instrument, term (in years) | 3 years | ||||||
$500.0 million term loan | $300 million term loan | |||||||
Debt Instrument [Line Items] | |||||||
Carrying amount of long-term debt | 180,000,000 | 180,000,000 | |||||
Less: current portion of long-term debt | 10,000,000 | ||||||
Aggregate principal amount of notes issued | $ 300,000,000 | 300,000,000 | |||||
Debt instrument, term (in years) | 5 years | ||||||
$500.0 million term loan | $190 million term loan | |||||||
Debt Instrument [Line Items] | |||||||
Carrying amount of long-term debt | 90,000,000 | 0 | |||||
Less: current portion of long-term debt | $ 89,900,000 | ||||||
Interest rate percentage | 0.75% | ||||||
Aggregate principal amount of notes issued | $ 190,000,000 | $ 190,000,000 | |||||
Debt instrument, term (in years) | 3 years | ||||||
$500.0 million term loan | 3.81% series A senior notes | |||||||
Debt Instrument [Line Items] | |||||||
Carrying amount of long-term debt | $ 100,000,000 | 100,000,000 | |||||
Interest rate percentage | 3.81% | 3.81% | |||||
Aggregate principal amount of notes issued | $ 100,000,000 | $ 100,000,000 | |||||
$500.0 million term loan | 3.91% series B senior notes | |||||||
Debt Instrument [Line Items] | |||||||
Carrying amount of long-term debt | $ 100,000,000 | 100,000,000 | |||||
Interest rate percentage | 3.91% | 3.91% | |||||
Aggregate principal amount of notes issued | $ 100,000,000 | $ 100,000,000 | |||||
$500.0 million term loan | 6.625% senior notes | |||||||
Debt Instrument [Line Items] | |||||||
Carrying amount of long-term debt | $ 123,978,000 | 123,916,000 | |||||
Interest rate percentage | 6.625% | ||||||
Debentures | |||||||
Debt Instrument [Line Items] | |||||||
Interest rate percentage | 7.80% | ||||||
Aggregate principal amount of notes issued | $ 175,000,000 | ||||||
Debentures | 7.8% debentures | |||||||
Debt Instrument [Line Items] | |||||||
Carrying amount of long-term debt | $ 100,000,000 | $ 100,000,000 | |||||
Total long-term debt | $ 100,000,000 | ||||||
Interest rate percentage | 7.80% | 7.80% | |||||
Debt instrument, term (in years) | 30 years |
Indebtedness - Narrative (Detai
Indebtedness - Narrative (Details) | Mar. 30, 2020USD ($)payment | Apr. 30, 2019USD ($) | Mar. 31, 2019USD ($) | Jun. 30, 1997USD ($)instrument | Oct. 31, 2020USD ($) | Oct. 31, 2019USD ($) | Oct. 31, 2018USD ($) | Jun. 27, 2019USD ($) | Apr. 26, 2007USD ($) |
Principal payments on long-term debt in fiscal years | |||||||||
2021 | $ 13,500,000 | ||||||||
2022 | 133,700,000 | ||||||||
2023 | 69,800,000 | ||||||||
2024 | 153,000,000 | ||||||||
2025 | 0 | ||||||||
After 2025 | 425,000,000 | ||||||||
Maximum borrowing capacity | 13,400,000 | $ 13,300,000 | |||||||
Total long-term debt | 791,123,000 | 700,813,000 | |||||||
Current portion of long-term debt | 99,873,000 | 79,914,000 | |||||||
$500.0 million term loan | |||||||||
Principal payments on long-term debt in fiscal years | |||||||||
Interest expense, debt | $ 8,400,000 | 8,400,000 | $ 8,400,000 | ||||||
Debt instrument, basis spread on variable rate | 0.30% | ||||||||
Line of Credit | |||||||||
Principal payments on long-term debt in fiscal years | |||||||||
Maximum borrowing capacity | $ 600,000,000 | ||||||||
Accordion feature | 300,000,000 | ||||||||
Carrying amount of long-term debt | 0 | 0 | |||||||
Unused borrowing capacity | 597,500,000 | 598,100,000 | |||||||
Interest expense, debt | $ 800,000 | 1,900,000 | 1,300,000 | ||||||
Debt instrument, term (in years) | 5 years | ||||||||
$500.0 million term loan | |||||||||
Principal payments on long-term debt in fiscal years | |||||||||
Interest expense, debt | $ 5,200,000 | 7,500,000 | |||||||
Amortization payment percentage | 2.50% | ||||||||
$500.0 million term loan | $200 million and $300 million term loans | |||||||||
Principal payments on long-term debt in fiscal years | |||||||||
Aggregate principal amount of notes issued | $ 500,000,000 | ||||||||
$500.0 million term loan | $200 million term loan | |||||||||
Principal payments on long-term debt in fiscal years | |||||||||
Carrying amount of long-term debt | 100,000,000 | 100,000,000 | |||||||
Aggregate principal amount of notes issued | $ 200,000,000 | 200,000,000 | |||||||
Debt instrument, term (in years) | 3 years | ||||||||
Early repayment of senior debt | 100,000,000 | 100,000,000 | |||||||
$500.0 million term loan | $300 million term loan | |||||||||
Principal payments on long-term debt in fiscal years | |||||||||
Carrying amount of long-term debt | 180,000,000 | 180,000,000 | |||||||
Aggregate principal amount of notes issued | $ 300,000,000 | 300,000,000 | |||||||
Debt instrument, term (in years) | 5 years | ||||||||
Principal payment requirement term | 3 years 3 months | ||||||||
Early repayment of senior debt | 120,000,000 | 120,000,000 | |||||||
Current portion of long-term debt | 10,000,000 | ||||||||
$500.0 million term loan | $190 million term loan | |||||||||
Principal payments on long-term debt in fiscal years | |||||||||
Carrying amount of long-term debt | 90,000,000 | 0 | |||||||
Interest expense, debt | 2,400,000 | ||||||||
Aggregate principal amount of notes issued | $ 190,000,000 | 190,000,000 | |||||||
Debt instrument, term (in years) | 3 years | ||||||||
Early repayment of senior debt | 100,000,000 | ||||||||
Current portion of long-term debt | 89,900,000 | ||||||||
Long-term debt, current maturities, amortization payments | 13,500,000 | ||||||||
Long-term debt, current maturities, prepayments | $ 76,400,000 | ||||||||
Interest rate percentage | 0.75% | ||||||||
$500.0 million term loan | $190 million term loan | Debt Instrument, Repayment Period One | |||||||||
Principal payments on long-term debt in fiscal years | |||||||||
Amortization payment percentage | 5.00% | ||||||||
Debt instrument, repayment period | payment | 4 | ||||||||
$500.0 million term loan | $190 million term loan | Debt Instrument, Repayment Period Two | |||||||||
Principal payments on long-term debt in fiscal years | |||||||||
Amortization payments, loan percentage, thereafter | 7.50% | ||||||||
$500.0 million term loan | Series A and Series B Senior Notes | |||||||||
Principal payments on long-term debt in fiscal years | |||||||||
Interest expense, debt | $ 7,700,000 | 2,600,000 | |||||||
$500.0 million term loan | Series A and Series B Senior Notes | Debt Instrument, Redemption, Period One | |||||||||
Principal payments on long-term debt in fiscal years | |||||||||
Debt instrument, redemption price, percentage | 10.00% | ||||||||
$500.0 million term loan | Series A and Series B Senior Notes | Debt Instrument, Redemption, Period Two | |||||||||
Principal payments on long-term debt in fiscal years | |||||||||
Debt instrument, redemption price, percentage | 100.00% | ||||||||
$500.0 million term loan | Series A and Series B Senior Notes | Debt Instrument, Redemption, Period Three | |||||||||
Principal payments on long-term debt in fiscal years | |||||||||
Debt instrument, redemption price, percentage | 100.00% | ||||||||
$500.0 million term loan | 3.81% series A senior notes | |||||||||
Principal payments on long-term debt in fiscal years | |||||||||
Carrying amount of long-term debt | $ 100,000,000 | 100,000,000 | |||||||
Aggregate principal amount of notes issued | $ 100,000,000 | $ 100,000,000 | |||||||
Interest rate percentage | 3.81% | 3.81% | |||||||
$500.0 million term loan | 3.91% series B senior notes | |||||||||
Principal payments on long-term debt in fiscal years | |||||||||
Carrying amount of long-term debt | $ 100,000,000 | 100,000,000 | |||||||
Aggregate principal amount of notes issued | $ 100,000,000 | $ 100,000,000 | |||||||
Interest rate percentage | 3.91% | 3.91% | |||||||
$500.0 million term loan | 6.625% Senior Notes | |||||||||
Principal payments on long-term debt in fiscal years | |||||||||
Aggregate principal amount of notes issued | $ 125,000,000 | ||||||||
Interest rate percentage | 6.625% | 6.625% | |||||||
Percentage of par value at which debt was issued | 98.513% | ||||||||
Debt discount, unamortized | $ 1,900,000 | ||||||||
Effective interest rate (as a percent) | 6.741% | ||||||||
Redemption price as a percentage of the principal amount upon the occurrence of both a change of control and downgrade of rating (as a percent) | 101.00% | ||||||||
Debentures | |||||||||
Principal payments on long-term debt in fiscal years | |||||||||
Interest expense, debt | $ 8,000,000 | 7,900,000 | $ 8,000,000 | ||||||
Aggregate principal amount of notes issued | $ 175,000,000 | ||||||||
Interest rate percentage | 7.80% | ||||||||
Amount paid to terminate forward-starting interest rate swap agreements | $ 23,700,000 | ||||||||
Number of terminated forward-starting interest rate swap agreements | instrument | 3 | ||||||||
Derivative, notional amount | $ 125,000,000 | ||||||||
Deferred income amount at the time of swap termination | 18,700,000 | ||||||||
Debentures | 7.8% debentures | |||||||||
Principal payments on long-term debt in fiscal years | |||||||||
Carrying amount of long-term debt | $ 100,000,000 | 100,000,000 | |||||||
Total long-term debt | $ 100,000,000 | ||||||||
Debt instrument, term (in years) | 30 years | ||||||||
Interest rate percentage | 7.80% | 7.80% | |||||||
Debentures | Coupon 7.125% Debt Notes | |||||||||
Principal payments on long-term debt in fiscal years | |||||||||
Aggregate principal amount of notes issued | $ 75,000,000 | ||||||||
Debt instrument, term (in years) | 10 years | ||||||||
Interest rate percentage | 7.125% | ||||||||
Standby Letters of Credit | Line of Credit | |||||||||
Principal payments on long-term debt in fiscal years | |||||||||
Maximum borrowing capacity | $ 10,000,000 | ||||||||
Total long-term debt | 2,500,000 | $ 1,900,000 | |||||||
Swingline Loan | Line of Credit | |||||||||
Principal payments on long-term debt in fiscal years | |||||||||
Maximum borrowing capacity | $ 30,000,000 |
Management Actions - Narrative
Management Actions - Narrative (Details) - USD ($) | 3 Months Ended | 12 Months Ended | |
Oct. 31, 2019 | Oct. 31, 2020 | Oct. 31, 2019 | |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||
Total accrued liabilities | $ 357,826,000 | $ 376,524,000 | $ 357,826,000 |
Cost of sales | |||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||
Restructuring charges | 600,000 | ||
Selling, General and Administrative Expenses | |||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||
Restructuring charges | 6,000,000 | ||
Toro Underground Wind Down | Disposal Group, Not Discontinued Operations | |||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||
Income (loss) from individually significant component disposed of or held-for-sale, excluding discontinued operations, attributable to parent, before income tax | 900,000 | 8,800,000 | |
Total accrued liabilities | $ 900,000 | 0 | 900,000 |
Toro Underground Wind Down | Disposal Group, Not Discontinued Operations | Net sales | |||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||
Income (loss) from individually significant component disposed of or held-for-sale, excluding discontinued operations, attributable to parent, before income tax | $ 0 | $ 1,200,000 |
Investment in Joint Venture - N
Investment in Joint Venture - Narrative (Details) - USD ($) | 12 Months Ended | |||
Oct. 31, 2020 | Oct. 31, 2019 | Oct. 31, 2018 | Dec. 20, 2019 | |
Schedule of Equity Method Investments [Line Items] | ||||
Maximum borrowing capacity under credit facility | $ 13,400,000 | $ 13,300,000 | ||
Line of Credit | ||||
Schedule of Equity Method Investments [Line Items] | ||||
Maximum borrowing capacity under credit facility | $ 600,000,000 | |||
Red Iron Acceptance, LLC | ||||
Schedule of Equity Method Investments [Line Items] | ||||
Portion owned by Toro (as a percent) | 45.00% | |||
Portion owned by TCFIF (as a percent) | 55.00% | |||
Period of unlimited automatic extensions after the initial term of joint venture | 2 years | |||
Period of notice to be given by parties under joint venture for not extending initial term of joint venture | 1 year | |||
Period of review for products acquired in future acquisitions to asses potential benefits and detriments | 2 years | |||
Period of pro-rata payback after initial term of joint venture | 5 years | |||
Maximum borrowing capacity under credit facility | $ 625,000,000 | |||
Investment in joint venture | 19,700,000 | 24,100,000 | ||
Maximum aggregate amount of products repossessed by Red Iron and the TCFIF Canadian affiliate, entity has agreed to repurchase in a calendar year | 7,500,000 | |||
Net amount of receivables financed for dealers and distributors | 1,832,500,000 | 1,924,900,000 | $ 1,959,700,000 | |
Receivable due | $ 12,600,000 | 21,900,000 | ||
Red Iron Acceptance, LLC | Twin City Federal Inventory Finance Incorporated Secured Revolving Credit Facility | Line of Credit | ||||
Schedule of Equity Method Investments [Line Items] | ||||
Maximum borrowing capacity under credit facility | $ 550,000,000 | $ 625,000,000 |
Investment in Joint Venture - S
Investment in Joint Venture - Summary of Red Iron (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Oct. 31, 2020 | Jul. 31, 2020 | May 01, 2020 | Jan. 31, 2020 | Oct. 31, 2019 | Aug. 02, 2019 | May 03, 2019 | Feb. 01, 2019 | Oct. 31, 2020 | Oct. 31, 2019 | Oct. 31, 2018 | |
Schedule of Equity Method Investments [Line Items] | |||||||||||
Net earnings | $ 72,196 | $ 88,968 | $ 98,446 | $ 70,091 | $ 38,266 | $ 60,607 | $ 115,570 | $ 59,540 | $ 329,701 | $ 273,983 | $ 271,939 |
Total assets | 2,853,228 | 2,330,547 | 2,853,228 | 2,330,547 | 1,570,984 | ||||||
Total liabilities and stockholders' equity | 2,853,228 | 2,330,547 | 2,853,228 | 2,330,547 | |||||||
Red Iron Acceptance, LLC | Equity Method Investment, Nonconsolidated Investee or Group of Investees | |||||||||||
Schedule of Equity Method Investments [Line Items] | |||||||||||
Revenue | 31,040 | 47,569 | 42,051 | ||||||||
Interest and operating expenses, net | (14,177) | (21,011) | (17,288) | ||||||||
Net earnings | 16,863 | 26,558 | $ 24,763 | ||||||||
Finance receivables, net | 386,781 | 486,834 | 386,781 | 486,834 | |||||||
Other assets | 2,929 | 3,733 | 2,929 | 3,733 | |||||||
Total assets | 389,710 | 490,567 | 389,710 | 490,567 | |||||||
Notes payable | 332,838 | 419,308 | 332,838 | 419,308 | |||||||
Other liabilities | 12,994 | 17,594 | 12,994 | 17,594 | |||||||
Partners' capital | 43,878 | 53,665 | 43,878 | 53,665 | |||||||
Total liabilities and stockholders' equity | $ 389,710 | $ 490,567 | $ 389,710 | $ 490,567 |
Income Taxes - Earnings Before
Income Taxes - Earnings Before Income Taxes (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Oct. 31, 2020 | Oct. 31, 2019 | Oct. 31, 2018 | |
Earnings before income taxes: | |||
U.S. | $ 369,016 | $ 283,730 | $ 333,136 |
Foreign | 38,054 | 38,403 | 39,261 |
Total earnings before income taxes | $ 407,070 | $ 322,133 | $ 372,397 |
Income Taxes - Reconciliation o
Income Taxes - Reconciliation of the Statutory Federal Income Tax Rate (Details) | 12 Months Ended | ||
Oct. 31, 2020 | Oct. 31, 2019 | Oct. 31, 2018 | |
Effective Income Tax Rate Reconciliation, Percent [Abstract] | |||
Statutory federal income tax rate | 21.00% | 21.00% | 23.30% |
Excess deduction for stock compensation | (1.70%) | (3.70%) | (3.50%) |
Domestic manufacturer's deduction | 0.00% | 0.10% | (0.90%) |
State and local income taxes, net of federal benefit | 2.40% | 1.10% | 1.30% |
Foreign operations | (0.60%) | (0.30%) | (0.50%) |
Federal research tax credit | (1.70%) | (1.50%) | (1.20%) |
Foreign-derived intangible income | 0.00% | (1.30%) | 0.00% |
Remeasurement of deferred tax assets and liabilities | 0.00% | (0.10%) | 5.20% |
Deemed repatriation tax | 0.00% | (0.20%) | 3.60% |
Other, net | (0.40%) | (0.20%) | (0.30%) |
Effective tax rate | 19.00% | 14.90% | 27.00% |
Income Taxes - Narrative (Detai
Income Taxes - Narrative (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Oct. 31, 2020 | Oct. 31, 2019 | Oct. 31, 2018 | |
Income Taxes [Line Items] | |||
Statutory federal income tax rate | 21.00% | 21.00% | 23.30% |
Tax expense for remeasurement of deferred tax assets and liabilities | $ 0.3 | $ 19.3 | |
Deemed repatriation tax | 0.7 | $ 13.4 | |
Valuation allowance, deferred tax asset, increase (decrease), amount | $ 0.4 | $ 0.4 | |
Undistributed earnings of foreign subsidiaries | 19 | ||
Accrued interest and penalties for unrecognized tax benefits | 0.8 | ||
Potential benefits that would affect the effective tax rate | 2.9 | ||
Foreign Jurisdictions | |||
Income Taxes [Line Items] | |||
Net operating loss carryforwards in foreign jurisdictions | 3.7 | ||
Net operating loss carryforwards in foreign jurisdictions not subject to expiration | 2.2 | ||
Net operating loss carryforwards subject to expiration | 1.5 | ||
Domestic Tax Authority | |||
Income Taxes [Line Items] | |||
Net operating loss carryforwards subject to expiration | $ 1.7 |
Income Taxes - Components of th
Income Taxes - Components of the Provisions For Income Taxes (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Oct. 31, 2020 | Oct. 31, 2019 | Oct. 31, 2018 | |
Current provision: | |||
Federal | $ 58,243 | $ 37,415 | $ 64,375 |
State | 11,322 | 7,495 | 6,192 |
Foreign | 5,534 | 6,846 | 7,087 |
Total current provision | 75,099 | 51,756 | 77,654 |
Deferred provision (benefit): | |||
Federal | 1,710 | (37) | 22,074 |
State | 634 | (3,205) | 308 |
Foreign | (74) | (364) | 422 |
Total deferred provision (benefit) | 2,270 | (3,606) | 22,804 |
Total provision for income taxes | $ 77,369 | $ 48,150 | $ 100,458 |
Income Taxes - Tax Effects of T
Income Taxes - Tax Effects of Temporary Differences (Details) - USD ($) $ in Thousands | Oct. 31, 2020 | Oct. 31, 2019 |
Deferred income tax assets: | ||
Compensation and benefits | $ 30,363 | $ 27,969 |
Warranty and insurance | 28,480 | 25,788 |
Lease liabilities | 20,843 | |
Advertising and sales allowance | 6,937 | 8,866 |
Inventory | 4,937 | 4,005 |
Deferred revenue | 2,910 | 4,373 |
Other | 9,643 | 4,372 |
Valuation allowance | (3,570) | (3,199) |
Total deferred income tax assets | 100,543 | 72,174 |
Deferred income tax liabilities: | ||
Right-of-use assets | (20,179) | |
Depreciation | (49,018) | (40,964) |
Amortization | (95,315) | (75,538) |
Total deferred income tax liabilities | (164,512) | (116,502) |
Deferred income tax liabilities, net | $ (63,969) | $ (44,328) |
Income Taxes - Reconciliation (
Income Taxes - Reconciliation (Details) $ in Thousands | 12 Months Ended |
Oct. 31, 2020USD ($) | |
Reconciliation of Unrecognized Tax Benefits, Excluding Amounts Pertaining to Examined Tax Returns [Roll Forward] | |
Balance at the beginning of the period | $ 2,673 |
Increase as a result of tax positions taken during a prior period | 166 |
Decrease as a result of tax positions taken during the current period | (183) |
Increase as a result of tax positions taken during the current period | 291 |
Reductions as a result of statute of limitations lapses | (87) |
Balance at the end of the period | $ 2,860 |
Stock-Based Compensation Plan_2
Stock-Based Compensation Plans - Narrative (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Oct. 31, 2020 | Oct. 31, 2019 | Oct. 31, 2018 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Common stock available for future grants (in shares) | 3,740,799 | ||
Total compensation cost for stock-based awards | $ 15,408 | $ 13,429 | $ 12,161 |
Share-based Payment Arrangement, Nonemployee | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Granted (in shares) | 8,920 | 10,090 | 8,388 |
Unrestricted common stock awards | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Total compensation cost for stock-based awards | $ 693 | $ 592 | $ 530 |
Stock option awards | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Compensation cost not yet recognized | $ 2,800 | ||
Period for recognition | 1 year 9 months | ||
Total compensation cost for stock-based awards | $ 9,163 | 6,537 | 5,006 |
Stock option awards | Certain members of the Board of Directors | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Award vesting period | 3 years | ||
Term of award | 10 years | ||
Stock option awards | Certain employees | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Award vesting period | 3 years | ||
Term of award | 10 years | ||
Stock option awards | Nonemployee | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Requisite service period for non-employee director after which fair value of options granted is fully expensed on the date of grant | 10 years | ||
Performance share awards | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Granted (in shares) | 81,655,000 | ||
Compensation cost not yet recognized | $ 3,400 | ||
Period for recognition | 1 year 9 months | ||
Performance goal period | 3 years | ||
Total compensation cost for stock-based awards | $ 2,123 | 3,070 | 3,628 |
Restricted stock unit awards | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Granted (in shares) | 27,161,000 | ||
Award vesting period | 3 years | ||
Compensation cost not yet recognized | $ 3,000 | ||
Period for recognition | 1 year 9 months 3 days | ||
Total compensation cost for stock-based awards | $ 3,429 | $ 3,230 | $ 2,997 |
Minimum | Performance share awards | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Award vesting rights percentage | 200.00% | ||
Maximum | Performance share awards | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Award vesting rights percentage | 0.00% | ||
Share-based Compensation Award, Tranche One | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Award vesting rights percentage | 33.33% | ||
Share-based Compensation Award, Tranche One | Restricted stock unit awards | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Award vesting rights percentage | 33.33% | ||
Share-based Compensation Award, Tranche Two | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Award vesting rights percentage | 33.33% | ||
Share-based Compensation Award, Tranche Two | Restricted stock unit awards | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Award vesting rights percentage | 33.33% | ||
Share-based Compensation Award, Tranche Three | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Award vesting rights percentage | 33.33% | ||
Share-based Compensation Award, Tranche Three | Restricted stock unit awards | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Award vesting rights percentage | 33.33% |
Stock-Based Compensation Plan_3
Stock-Based Compensation Plans - Compensation Costs Related to Stock-Based Awards (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Oct. 31, 2020 | Oct. 31, 2019 | Oct. 31, 2018 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Total compensation cost for stock-based awards | $ 15,408 | $ 13,429 | $ 12,161 |
Related tax benefit from stock-based awards | 3,696 | 3,200 | 2,905 |
Unrestricted common stock awards | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Total compensation cost for stock-based awards | 693 | 592 | 530 |
Stock option awards | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Total compensation cost for stock-based awards | 9,163 | 6,537 | 5,006 |
Performance share awards | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Total compensation cost for stock-based awards | 2,123 | 3,070 | 3,628 |
Restricted stock unit awards | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Total compensation cost for stock-based awards | $ 3,429 | $ 3,230 | $ 2,997 |
Stock-Based Compensation Plan_4
Stock-Based Compensation Plans - Weighted-average Valuation Assumptions For Options Granted (Details) - $ / shares | 12 Months Ended | ||
Oct. 31, 2020 | Oct. 31, 2019 | Oct. 31, 2018 | |
Share-based Payment Arrangement [Abstract] | |||
Expected life of option in years | 6 years 3 months 21 days | 6 years 3 months 21 days | 6 years 14 days |
Expected stock price volatility | 19.53% | 19.83% | 20.58% |
Risk-free interest rate | 1.73% | 2.77% | 2.21% |
Expected dividend yield | 0.99% | 1.18% | 0.97% |
Per share weighted-average fair value at date of grant (usd per share) | $ 15.23 | $ 12.83 | $ 14.25 |
Stock-Based Compensation Plan_5
Stock-Based Compensation Plans - Stock Option Activity (Details) - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | |
Oct. 31, 2020 | Oct. 31, 2019 | |
Stock Option Awards | ||
Outstanding at the beginning of the period (in shares) | 2,848,120 | |
Granted (in shares) | 536,890 | |
Exercised (in shares) | (734,398) | |
Forfeited (in shares) | (4,009) | |
Outstanding at the end of the period (in shares) | 2,646,603 | 2,848,120 |
Exercisable at the end of the period (in shares) | 1,609,770 | |
Weighted-Average Exercise Price | ||
Outstanding at the beginning of the period (in dollars per share) | $ 44.34 | |
Granted (in dollars per share) | 76.07 | |
Exercised (in dollars per share) | 31.10 | |
Forfeited (in dollars per share) | 75.23 | |
Outstanding at the end of the period (in dollars per share) | 54.40 | $ 44.34 |
Exercisable at the end of the period (in dollars per share) | $ 45.22 | |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Additional Disclosures [Abstract] | ||
Weighted-average contractual life (years) | 6 years 2 months 12 days | 5 years 8 months 12 days |
Exercisable at the end of the period (years) | 4 years 9 months 18 days | |
Outstanding of the beginning of the period, intrinsic value | $ 93,392 | |
Outstanding of the end of the period, intrinsic value | 73,305 | $ 93,392 |
Exercisable at the end of the period, intrinsic value | $ 59,364 |
Stock-Based Compensation Plan_6
Stock-Based Compensation Plans - Market and Intrinsic Value of Options Exercised (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Oct. 31, 2020 | Oct. 31, 2019 | Oct. 31, 2018 | |
Share-based Payment Arrangement [Abstract] | |||
Market value of stock options exercised | $ 56,761 | $ 92,352 | $ 70,775 |
Intrinsic value of options exercised | $ 33,920 | $ 62,288 | $ 53,778 |
Stock-Based Compensation Plan_7
Stock-Based Compensation Plans - Factors Related to the Company's Stock and Restricted Stock Units (Details) - Restricted stock unit awards - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | ||
Oct. 31, 2020 | Oct. 31, 2019 | Oct. 31, 2018 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Weighted-average per award fair value at date of grant (in dollars per share) | $ 74.55 | $ 66.26 | $ 63.24 |
Fair value of restricted stock units vested | $ 3,410 | $ 3,083 | $ 4,888 |
Stock-Based Compensation Plan_8
Stock-Based Compensation Plans - Summary of Activity For Unvested Restricted Stock and Restricted Stock Units (Details) - Restricted stock unit awards - $ / shares shares in Thousands | 12 Months Ended | ||
Oct. 31, 2020 | Oct. 31, 2019 | Oct. 31, 2018 | |
Restricted Stock Units | |||
Unvested at the beginning of the period (in shares) | 124,467 | ||
Granted (in shares) | 27,161 | ||
Vested (in shares) | (48,212) | ||
Forfeited (in shares) | (3,136) | ||
Unvested at the end of the period (in shares) | 100,280 | 124,467 | |
Weighted-Average Fair Value at Date of Grant | |||
Unvested at the beginning of the period (in dollars per share) | $ 65.30 | ||
Granted (in dollars per share) | 74.55 | $ 66.26 | $ 63.24 |
Vested (in dollars per share) | 64.97 | ||
Forfeited (in dollars per share) | 70.40 | ||
Unvested at the end of the period (in dollars per share) | $ 67.69 | $ 65.30 |
Stock-Based Compensation Plan_9
Stock-Based Compensation Plans - Factors Related to the Company's Performance Share Awards (Details) - Performance share awards - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | ||
Oct. 31, 2020 | Oct. 31, 2019 | Oct. 31, 2018 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Weighted-average per award fair value at date of grant (in dollars per share) | $ 77.33 | $ 59.58 | $ 65.40 |
Fair value of restricted stock units vested | $ 6,271 | $ 6,300 | $ 8,419 |
Stock-Based Compensation Pla_10
Stock-Based Compensation Plans - Summary of Activity For Unvested Performance Share Awards (Details) - Performance share awards - $ / shares shares in Thousands | 12 Months Ended | ||
Oct. 31, 2020 | Oct. 31, 2019 | Oct. 31, 2018 | |
Restricted Stock Units | |||
Unvested at the beginning of the period (in shares) | 192,854 | ||
Granted (in shares) | 81,655 | ||
Vested (in shares) | (82,782) | ||
Forfeited (in shares) | (4,306) | ||
Unvested at the end of the period (in shares) | 187,421 | 192,854 | |
Weighted-Average Fair Value at Date of Grant | |||
Unvested at the beginning of the period (in dollars per share) | $ 59.47 | ||
Weighted-average per award fair value at date of grant (in dollars per share) | 77.33 | $ 59.58 | $ 65.40 |
Vested (in dollars per share) | 54.52 | ||
Forfeited (in dollars per share) | 61.27 | ||
Unvested at the end of the period (in dollars per share) | $ 67.58 | $ 59.47 |
Stockholders' Equity - Narrativ
Stockholders' Equity - Narrative (Details) - USD ($) $ in Thousands | 12 Months Ended | ||||
Oct. 31, 2020 | Oct. 31, 2019 | Oct. 31, 2018 | Dec. 04, 2018 | Dec. 03, 2015 | |
Stock repurchase program | |||||
Amount paid to repurchase the shares | $ 2,146 | $ 22,705 | $ 164,530 | ||
Repurchase of shares (in shares) | 29,422 | 403,532 | 2,777,687 | ||
Treasury shares | |||||
Treasury shares held (in shares) | 20,545,330 | 21,385,919 | |||
Cost of treasury shares | $ 1,323,200 | $ 1,374,000 | |||
Stock repurchase program | |||||
Stock repurchase program | |||||
Number of shares authorized to be repurchased (in shares) | 8,000,000 | ||||
Amount paid to repurchase the shares | $ 20,000 | $ 160,400 | |||
Repurchase of shares (in shares) | 0 | 359,758 | 2,579,864 | ||
Number of shares remained authorized for repurchase (in shares) | 7,042,256 | ||||
December 2018 Stock Repurchase Program | |||||
Stock repurchase program | |||||
Number of shares authorized to be repurchased (in shares) | 5,000,000 |
Stockholders' Equity - Componen
Stockholders' Equity - Components of AOCL (Details) - USD ($) $ in Thousands | Oct. 31, 2020 | Oct. 31, 2019 | Oct. 31, 2018 | Oct. 31, 2017 |
Components and activity of accumulated other comprehensive loss | ||||
Total accumulated other comprehensive loss | $ (1,114,828) | $ (859,578) | $ (668,916) | $ (617,092) |
Foreign Currency Translation Adjustments | ||||
Components and activity of accumulated other comprehensive loss | ||||
Total accumulated other comprehensive loss | 24,508 | 31,025 | 29,711 | |
Pension Benefits | ||||
Components and activity of accumulated other comprehensive loss | ||||
Total accumulated other comprehensive loss | 5,106 | 4,861 | 561 | |
Cash Flow Derivative Instruments | ||||
Components and activity of accumulated other comprehensive loss | ||||
Total accumulated other comprehensive loss | 4,648 | (3,837) | (6,335) | |
Accumulated Other Comprehensive Loss | ||||
Components and activity of accumulated other comprehensive loss | ||||
Total accumulated other comprehensive loss | $ 34,262 | $ 32,049 | $ 23,937 | $ 24,120 |
Stockholders' Equity - Compon_2
Stockholders' Equity - Components and activity of AOCL (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Oct. 31, 2020 | Oct. 31, 2019 | Oct. 31, 2018 | |
Components and activity of accumulated other comprehensive loss | |||
Balance as of the beginning of the fiscal period | $ (859,578) | $ (668,916) | $ (617,092) |
Other comprehensive (income) loss before reclassifications | 7,887 | 1,566 | |
Amounts reclassified from AOCL | (5,674) | 6,546 | |
Net current period other comprehensive (income) loss | 2,213 | 8,112 | (42) |
Balance as of the end of the fiscal period | (1,114,828) | (859,578) | (668,916) |
Total | |||
Components and activity of accumulated other comprehensive loss | |||
Balance as of the beginning of the fiscal period | 32,049 | 23,937 | 24,120 |
Net current period other comprehensive (income) loss | 2,213 | 8,112 | (42) |
Balance as of the end of the fiscal period | 34,262 | 32,049 | 23,937 |
Foreign Currency Translation Adjustments | |||
Components and activity of accumulated other comprehensive loss | |||
Balance as of the beginning of the fiscal period | 31,025 | 29,711 | |
Other comprehensive (income) loss before reclassifications | (6,517) | 1,314 | |
Net current period other comprehensive (income) loss | (6,517) | 1,314 | |
Balance as of the end of the fiscal period | 24,508 | 31,025 | 29,711 |
Pension Benefits | |||
Components and activity of accumulated other comprehensive loss | |||
Balance as of the beginning of the fiscal period | 4,861 | 561 | |
Other comprehensive (income) loss before reclassifications | 245 | 4,300 | |
Net current period other comprehensive (income) loss | 245 | 4,300 | |
Balance as of the end of the fiscal period | 5,106 | 4,861 | 561 |
Cash Flow Derivative Instruments | |||
Components and activity of accumulated other comprehensive loss | |||
Balance as of the beginning of the fiscal period | (3,837) | (6,335) | |
Other comprehensive (income) loss before reclassifications | 14,159 | (4,048) | |
Amounts reclassified from AOCL | (5,674) | 6,546 | |
Net current period other comprehensive (income) loss | 8,485 | 2,498 | |
Balance as of the end of the fiscal period | $ 4,648 | $ (3,837) | $ (6,335) |
Commitments and Contingencies (
Commitments and Contingencies (Details) - USD ($) | 12 Months Ended | |
Oct. 31, 2020 | Oct. 31, 2019 | |
Purchase Commitments | ||
Amount of noncancelable purchase commitments | $ 33,400,000 | |
Letters of Credit | ||
Maximum borrowing capacity | 13,400,000 | $ 13,300,000 |
Total long-term debt | 791,123,000 | 700,813,000 |
Letters of credit outstanding | 3,900,000 | 4,700,000 |
Wholesale Financing | ||
Customer Financing | ||
Receivables purchased by third party financing company from the company | 410,700,000 | 235,400,000 |
Receivables financed by third party financing company, excluding Red Iron, outstanding | 137,600,000 | 148,400,000 |
Maximum amount of contingent liability to repurchase inventory related receivables under limited inventory repurchase agreements | 128,100,000 | 125,900,000 |
End-User Financing | ||
Customer Financing | ||
Contingent liabilities for residual value or credit collection risk | 0 | |
End-User Financing | Maximum | ||
Customer Financing | ||
Exposure for credit collection | 12,500,000 | 10,100,000 |
Line of Credit | ||
Letters of Credit | ||
Maximum borrowing capacity | 600,000,000 | |
Standby Letters of Credit | Line of Credit | ||
Letters of Credit | ||
Maximum borrowing capacity | 10,000,000 | |
Total long-term debt | $ 2,500,000 | $ 1,900,000 |
Leases - Narrative (Details)
Leases - Narrative (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Oct. 31, 2019 | Oct. 31, 2018 | Oct. 31, 2020 | |
Lessee, Lease, Description [Line Items] | |||
Operating leases, rent expense | $ 34.1 | $ 27.4 | |
Minimum | |||
Lessee, Lease, Description [Line Items] | |||
Lessee, operating lease, renewal term | 2 years | ||
Maximum | |||
Lessee, Lease, Description [Line Items] | |||
Lessee, operating lease, renewal term | 10 years |
Leases - Lease Expense Incurred
Leases - Lease Expense Incurred (Details) $ in Thousands | 12 Months Ended |
Oct. 31, 2020USD ($) | |
Leases [Abstract] | |
Operating lease expense | $ 19,637 |
Short-term lease expense | 2,949 |
Variable lease expense | 134 |
Total lease expense | $ 22,720 |
Leases - Supplemental Cash Flow
Leases - Supplemental Cash Flow and Other Lease Information (Details) $ in Thousands | 12 Months Ended |
Oct. 31, 2020USD ($) | |
Leases [Abstract] | |
Operating cash flows for amounts included in the measurement of lease liabilities | $ 17,762 |
Right-of-use assets obtained in exchange for lease obligations | $ 22,667 |
Leases - Summary of Other Lease
Leases - Summary of Other Lease Information (Details) | Oct. 31, 2020 |
Leases [Abstract] | |
Weighted-average remaining lease term of operating leases in years | 7 years 1 month 6 days |
Weighted-average discount rate of operating leases | 2.79% |
Leases - Schedule of Future Min
Leases - Schedule of Future Minimum Operating Lease Payments (Details) - USD ($) $ in Thousands | Oct. 31, 2020 | Oct. 31, 2019 |
ASC Topic 842 Leases | ||
2021 | $ 18,077 | |
2022 | 15,391 | |
2023 | 12,293 | |
2024 | 10,936 | |
2025 | 9,919 | |
Thereafter | 23,604 | |
Total future minimum operating lease payments | 90,220 | |
Less: imputed interest | 8,132 | |
Present value of operating lease liabilities | $ 82,088 | |
ASC Topic 840 Leases | ||
2020 | $ 17,135 | |
2021 | 15,764 | |
2022 | 12,806 | |
2023 | 9,772 | |
2024 | 8,863 | |
Thereafter | 18,732 | |
Total future minimum lease payments | $ 83,072 |
Derivative Instruments and He_3
Derivative Instruments and Hedging Activities - Narrative (Details) | 12 Months Ended |
Oct. 31, 2020USD ($) | |
Summary of cash flow hedge activity | |
Maximum time limit for cash flow hedge | 2 years |
Cash flow hedge effectiveness testing, grace period | 2 months |
Gains from AOCL to earnings | $ (3,300,000) |
Forward currency contracts | |
Summary of cash flow hedge activity | |
Derivative, notional amount | $ 259,600,000 |
Derivative Instruments and He_4
Derivative Instruments and Hedging Activities - Fair Value of Derivatives (Details) - USD ($) $ in Thousands | Oct. 31, 2020 | Oct. 31, 2019 |
Fair value of derivatives | ||
Asset derivatives | $ 933 | $ 10,898 |
Liability derivatives | 2,484 | 9 |
Forward currency contracts | ||
Fair value of derivatives | ||
Asset derivatives | 933 | 10,898 |
Liability derivatives | 2,484 | 9 |
Forward currency contracts | Derivatives Designated as Hedging Instruments | Prepaid expenses and other current assets | ||
Fair value of derivatives | ||
Asset derivatives | 802 | 8,642 |
Forward currency contracts | Derivatives Designated as Hedging Instruments | Accrued liabilities | ||
Fair value of derivatives | ||
Liability derivatives | 2,687 | 0 |
Forward currency contracts | Derivatives Not Designated as Hedging Instruments | Prepaid expenses and other current assets | ||
Fair value of derivatives | ||
Asset derivatives | 131 | 2,256 |
Forward currency contracts | Derivatives Not Designated as Hedging Instruments | Accrued liabilities | ||
Fair value of derivatives | ||
Liability derivatives | $ (203) | $ 9 |
Derivative Instruments and He_5
Derivative Instruments and Hedging Activities - Effects of Master Netting Arrangements (Details) - USD ($) $ in Thousands | Oct. 31, 2020 | Oct. 31, 2019 |
Assets | ||
Net amounts of assets presented in the Consolidated Balance Sheets | $ 933 | $ 10,898 |
Liabilities | ||
Net amounts of liabilities presented in the Consolidated Balance Sheets | (2,484) | (9) |
Forward currency contracts | ||
Assets | ||
Gross amounts of recognized assets | 1,139 | 11,056 |
Gross liabilities offset in the Consolidated Balance Sheets | (206) | (158) |
Net amounts of assets presented in the Consolidated Balance Sheets | 933 | 10,898 |
Liabilities | ||
Gross amounts of recognized liabilities | (3,233) | (9) |
Gross assets offset in the Consolidated Balance Sheets | 749 | 0 |
Net amounts of liabilities presented in the Consolidated Balance Sheets | $ (2,484) | $ (9) |
Derivative Instruments and He_6
Derivative Instruments and Hedging Activities - Impacts and Location of Amounts Reclassified From AOCL (Details) - Cash Flow Hedging - USD ($) $ in Thousands | 12 Months Ended | |
Oct. 31, 2020 | Oct. 31, 2019 | |
Derivative Instruments, Gain (Loss) [Line Items] | ||
Total derivatives designated as cash flow hedging instruments | $ 5,674 | $ 6,546 |
Total derivatives designated as cash flow hedging instruments | (8,485) | (2,498) |
Forward currency contracts | Net sales | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Total derivatives designated as cash flow hedging instruments | 5,023 | 5,732 |
Total derivatives designated as cash flow hedging instruments | (8,232) | (2,268) |
Forward currency contracts | Cost of sales | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Total derivatives designated as cash flow hedging instruments | 651 | 814 |
Total derivatives designated as cash flow hedging instruments | $ (253) | $ (230) |
Derivative Instruments and He_7
Derivative Instruments and Hedging Activities - Impact and Location of Derivative Instruments on Consolidated Statements of Earnings (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Oct. 31, 2020 | Jul. 31, 2020 | May 01, 2020 | Jan. 31, 2020 | Oct. 31, 2019 | Aug. 02, 2019 | May 03, 2019 | Feb. 01, 2019 | Oct. 31, 2020 | Oct. 31, 2019 | Oct. 31, 2018 | |
Derivative Instruments and Hedging Activities | |||||||||||
Net sales | $ 840,957 | $ 840,972 | $ 929,398 | $ 767,483 | $ 734,379 | $ 838,713 | $ 962,036 | $ 602,956 | $ 3,378,810 | $ 3,138,084 | $ 2,618,650 |
Cost of sales | (2,189,036) | (2,090,121) | $ (1,677,639) | ||||||||
Cash Flow Hedging | Net sales | |||||||||||
Derivative Instruments and Hedging Activities | |||||||||||
Net sales | 3,378,810 | 3,138,084 | |||||||||
Cash Flow Hedging | Net sales | Forward currency contracts | |||||||||||
Derivative Instruments and Hedging Activities | |||||||||||
Total derivatives designated as cash flow hedging instruments | 5,023 | 5,732 | |||||||||
Total ineffective portion and components excluded from effectiveness testing | 3,229 | 5,358 | |||||||||
Cash Flow Hedging | Cost of sales | |||||||||||
Derivative Instruments and Hedging Activities | |||||||||||
Cost of sales | (2,189,036) | (2,090,121) | |||||||||
Cash Flow Hedging | Cost of sales | Forward currency contracts | |||||||||||
Derivative Instruments and Hedging Activities | |||||||||||
Total derivatives designated as cash flow hedging instruments | 651 | 814 | |||||||||
Total ineffective portion and components excluded from effectiveness testing | 313 | 135 | |||||||||
Derivatives Not Designated as Hedging Instruments | |||||||||||
Derivative Instruments and Hedging Activities | |||||||||||
Total loss on derivatives not designated as cash flow hedging instruments | (5,792) | (2,087) | |||||||||
Derivatives Not Designated as Hedging Instruments | Other income, net | Forward currency contracts | |||||||||||
Derivative Instruments and Hedging Activities | |||||||||||
Total loss on derivatives not designated as cash flow hedging instruments | $ (5,792) | $ (2,087) |
Fair Value Measurements - Narra
Fair Value Measurements - Narrative (Details) - USD ($) $ in Millions | Oct. 31, 2020 | Oct. 31, 2019 |
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Long-term debt bearing fixed interest | $ 424 | $ 423.9 |
Level 2 | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Long-term debt | $ 508.2 | $ 493.8 |
Fair Value Measurements - Recur
Fair Value Measurements - Recurring Fair Value Measurements (Details) - USD ($) $ in Thousands | Oct. 31, 2020 | Oct. 31, 2019 |
Assets: | ||
Forward currency contracts | $ 933 | $ 10,898 |
Liabilities: | ||
Forward currency contracts | 2,484 | 9 |
Forward currency contracts | ||
Assets: | ||
Forward currency contracts | 933 | 10,898 |
Liabilities: | ||
Forward currency contracts | 2,484 | 9 |
Measured on a recurring basis | ||
Assets: | ||
Total assets | 933 | 10,898 |
Liabilities: | ||
Total liabilities | 2,484 | 9 |
Measured on a recurring basis | Forward currency contracts | ||
Assets: | ||
Forward currency contracts | 933 | 10,898 |
Liabilities: | ||
Forward currency contracts | 2,484 | 9 |
Measured on a recurring basis | Level 1 | ||
Assets: | ||
Total assets | 0 | 0 |
Liabilities: | ||
Total liabilities | 0 | 0 |
Measured on a recurring basis | Level 1 | Forward currency contracts | ||
Assets: | ||
Forward currency contracts | 0 | 0 |
Liabilities: | ||
Forward currency contracts | 0 | 0 |
Measured on a recurring basis | Level 2 | ||
Assets: | ||
Total assets | 933 | 10,898 |
Liabilities: | ||
Total liabilities | 2,484 | 9 |
Measured on a recurring basis | Level 2 | Forward currency contracts | ||
Assets: | ||
Forward currency contracts | 933 | 10,898 |
Liabilities: | ||
Forward currency contracts | 2,484 | 9 |
Measured on a recurring basis | Level 3 | ||
Assets: | ||
Total assets | 0 | 0 |
Liabilities: | ||
Total liabilities | 0 | 0 |
Measured on a recurring basis | Level 3 | Forward currency contracts | ||
Assets: | ||
Forward currency contracts | 0 | 0 |
Liabilities: | ||
Forward currency contracts | $ 0 | $ 0 |
Employee Retirement Plans - Nar
Employee Retirement Plans - Narrative (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Oct. 31, 2020 | Oct. 31, 2019 | Oct. 31, 2018 | |
Retirement Benefits [Abstract] | |||
Plan expenses | $ 17.4 | $ 23.4 | $ 18.8 |
Projected benefit obligation | 33.4 | 39.5 | |
Fair value of the plan assets | 29.5 | 38 | |
Funded status of plans | (3.9) | (1.5) | |
Amounts recognized in AOCL, net of tax | 5.1 | 4.9 | |
Net expense recognized | $ (0.2) | $ (6.6) | $ 0.2 |
Other Income, Net - Summary of
Other Income, Net - Summary of Other Income/(Expense) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Oct. 31, 2020 | Oct. 31, 2019 | Oct. 31, 2018 | |
Other Income and Expenses [Abstract] | |||
Interest income | $ 1,255 | $ 2,753 | $ 2,463 |
Retail financing revenue | 1,080 | 1,178 | 1,232 |
Foreign currency exchange rate gain | 2,034 | 1,558 | 1,127 |
Non-cash income from finance affiliate | 7,663 | 11,948 | 11,143 |
Net periodic benefit income (loss) on defined benefit pension and post-retirement plans | (1,344) | 6,822 | 0 |
Miscellaneous | 3,181 | 1,680 | 2,443 |
Total other income, net | $ 13,869 | $ 25,939 | $ 18,408 |
Subsequent Events (Narrative) (
Subsequent Events (Narrative) (Details) - Subsequent Event - Exmark Manufacturing Company Incorporated v. Briggs & Stratton Corporation - USD ($) $ in Thousands | Nov. 19, 2020 | Dec. 16, 2020 |
Subsequent Event [Line Items] | ||
Litigation settlement, amount awarded to other party | $ 33,650 | |
Maximum | ||
Subsequent Event [Line Items] | ||
Contingent fee arrangement, percentage | 50.00% |
Quarterly Financial Data (Una_3
Quarterly Financial Data (Unaudited) - Summary of Quarterly Financial Data (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Oct. 31, 2020 | Jul. 31, 2020 | May 01, 2020 | Jan. 31, 2020 | Oct. 31, 2019 | Aug. 02, 2019 | May 03, 2019 | Feb. 01, 2019 | Oct. 31, 2020 | Oct. 31, 2019 | Oct. 31, 2018 | |
Quarterly Financial Information Disclosure [Abstract] | |||||||||||
Net sales | $ 840,957 | $ 840,972 | $ 929,398 | $ 767,483 | $ 734,379 | $ 838,713 | $ 962,036 | $ 602,956 | $ 3,378,810 | $ 3,138,084 | $ 2,618,650 |
Gross profit | 300,395 | 294,574 | 306,717 | 288,088 | 245,067 | 265,981 | 321,298 | 215,617 | 1,189,774 | 1,047,963 | 941,011 |
Net earnings | $ 72,196 | $ 88,968 | $ 98,446 | $ 70,091 | $ 38,266 | $ 60,607 | $ 115,570 | $ 59,540 | $ 329,701 | $ 273,983 | $ 271,939 |
Basic net earnings per share of common stock (in dollars per share) | $ 0.67 | $ 0.83 | $ 0.92 | $ 0.65 | $ 0.36 | $ 0.57 | $ 1.08 | $ 0.56 | $ 3.06 | $ 2.57 | $ 2.56 |
Diluted net earnings per share of common stock (in dollars per share) | $ 0.66 | $ 0.82 | $ 0.91 | $ 0.65 | $ 0.35 | $ 0.56 | $ 1.07 | $ 0.55 | $ 3.03 | $ 2.53 | $ 2.50 |