Document and Entity Information
Document and Entity Information - USD ($) | 12 Months Ended | ||
Dec. 31, 2021 | Feb. 16, 2022 | Jun. 30, 2021 | |
Document and Entity Information | |||
Document Type | 10-K | ||
Document Annual Report | true | ||
Document Period End Date | Dec. 31, 2021 | ||
Document Transition Report | false | ||
Entity File Number | 001-18761 | ||
Entity Registrant Name | MONSTER BEVERAGE CORPORATION | ||
Entity Incorporation, State or Country Code | DE | ||
Entity Tax Identification Number | 47-1809393 | ||
Entity Address, Address Line One | 1 Monster Way | ||
Entity Address, City or Town | Corona | ||
Entity Address, State or Province | CA | ||
Entity Address, Postal Zip Code | 92879 | ||
City Area Code | 951 | ||
Local Phone Number | 739 - 6200 | ||
Title of 12(b) Security | Common Stock, $0.005 par value per share | ||
Trading Symbol | MNST | ||
Security Exchange Name | NASDAQ | ||
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 | $ 43,749,615,959 | ||
Entity Common Stock, Shares Outstanding | 529,358,860 | ||
Entity Central Index Key | 0000865752 | ||
Current Fiscal Year End Date | --12-31 | ||
Document Fiscal Year Focus | 2021 | ||
Document Fiscal Period Focus | FY | ||
Amendment Flag | false | ||
Auditor Name | DELOITTE & TOUCHE LLP | ||
Auditor Firm ID | 34 | ||
Auditor Location | Costa Mesa, California |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Dec. 31, 2021 | Dec. 31, 2020 |
CURRENT ASSETS: | ||
Cash and cash equivalents | $ 1,326,462 | $ 1,180,413 |
Short-term investments | 1,749,727 | 881,354 |
Accounts receivable, net | 896,658 | 666,012 |
Inventories | 593,357 | 333,085 |
Prepaid expenses and other current assets | 82,668 | 55,358 |
Prepaid income taxes | 33,238 | 24,733 |
Total current assets | 4,682,110 | 3,140,955 |
INVESTMENTS | 99,419 | 44,291 |
PROPERTY AND EQUIPMENT, net | 313,753 | 314,656 |
DEFERRED INCOME TAXES | 225,221 | 241,650 |
GOODWILL | 1,331,643 | 1,331,643 |
OTHER INTANGIBLE ASSETS, net | 1,072,386 | 1,059,046 |
OTHER ASSETS | 80,252 | 70,475 |
Total Assets | 7,804,784 | 6,202,716 |
CURRENT LIABILITIES: | ||
Accounts payable | 404,263 | 296,800 |
Accrued liabilities | 210,964 | 142,653 |
Accrued promotional allowances | 211,461 | 186,658 |
Deferred revenue | 42,530 | 45,429 |
Accrued compensation | 65,459 | 55,015 |
Income taxes payable | 30,399 | 23,433 |
Total current liabilities | 965,076 | 749,988 |
DEFERRED REVENUE | 243,249 | 264,436 |
OTHER LIABILITIES | 29,508 | 27,432 |
COMMITMENTS AND CONTINGENCIES (Note 12) | ||
STOCKHOLDERS' EQUITY: | ||
Common stock - $0.005 par value; 1,250,000 shares authorized; 640,043 shares issued and 529,323 shares outstanding as of December 31, 2021; 638,662 shares issued and 528,097 shares outstanding as of December 31, 2020 | 3,200 | 3,193 |
Additional paid-in capital | 4,652,620 | 4,537,982 |
Retained earnings | 7,809,549 | 6,432,074 |
Accumulated other comprehensive (loss) income | (69,165) | 3,034 |
Common stock in treasury, at cost; 110,720 shares and 110,565 shares as of December 31, 2021 and December 31, 2020, respectively | (5,829,253) | (5,815,423) |
Total stockholders' equity | 6,566,951 | 5,160,860 |
Total Liabilities and Stockholders' Equity | $ 7,804,784 | $ 6,202,716 |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares shares in Thousands | Dec. 31, 2021 | Dec. 31, 2020 |
CONSOLIDATED BALANCE SHEETS | ||
Common stock, par value (in dollars per share) | $ 0.005 | $ 0.005 |
Common stock, shares authorized | 1,250,000 | 1,250,000 |
Common stock, shares issued | 640,043 | 638,662 |
Common stock, shares outstanding | 529,323 | 528,097 |
Common stock in treasury, shares | 110,720 | 110,565 |
CONSOLIDATED STATEMENTS OF INCO
CONSOLIDATED STATEMENTS OF INCOME - USD ($) shares in Thousands, $ in Thousands | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
CONSOLIDATED STATEMENTS OF INCOME | |||
NET SALES | $ 5,541,352 | $ 4,598,638 | $ 4,200,819 |
COST OF SALES | 2,432,839 | 1,874,758 | 1,682,234 |
GROSS PROFIT | 3,108,513 | 2,723,880 | 2,518,585 |
OPERATING EXPENSES | 1,311,046 | 1,090,727 | 1,115,646 |
OPERATING INCOME | 1,797,467 | 1,633,153 | 1,402,939 |
OTHER INCOME (EXPENSE), NET | 3,952 | (6,996) | 13,023 |
INCOME BEFORE PROVISION FOR INCOME TAXES | 1,801,419 | 1,626,157 | 1,415,962 |
PROVISION FOR INCOME TAXES | 423,944 | 216,563 | 308,127 |
NET INCOME | $ 1,377,475 | $ 1,409,594 | $ 1,107,835 |
NET INCOME PER COMMON SHARE: | |||
Basic | $ 2.61 | $ 2.66 | $ 2.04 |
Diluted | $ 2.57 | $ 2.64 | $ 2.03 |
WEIGHTED AVERAGE NUMBER OF SHARES OF COMMON STOCK AND COMMON STOCK EQUIVALENTS: | |||
Basic | 528,763 | 529,639 | 542,191 |
Diluted | 535,639 | 534,807 | 546,608 |
CONSOLIDATED STATEMENTS OF COMP
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME | |||
Net income, as reported | $ 1,377,475 | $ 1,409,594 | $ 1,107,835 |
Other comprehensive (loss) income: | |||
Change in foreign currency translation adjustment, net of tax | (71,158) | 35,531 | 194 |
Available-for-sale investments: | |||
Change in net unrealized gains (losses) | (1,041) | (110) | 283 |
Net change in available-for-sale investments | (1,041) | (110) | 283 |
Other comprehensive (loss) income | (72,199) | 35,421 | 477 |
Comprehensive income | $ 1,305,276 | $ 1,445,015 | $ 1,108,312 |
CONSOLIDATED STATEMENTS OF STOC
CONSOLIDATED STATEMENTS OF STOCKHOLDERS EQUITY - USD ($) shares in Thousands, $ in Thousands | Common Stock | Additional Paid-in Capital | Retained Earnings | Accumulated Other Comprehensive Income (Loss) | Treasury Stock | Total |
Balance at Dec. 31, 2018 | $ 3,155 | $ 4,238,170 | $ 3,914,645 | $ (32,864) | $ (4,512,205) | $ 3,610,901 |
Balance (in shares) at Dec. 31, 2018 | 630,970 | (87,294) | ||||
Increase (Decrease) in Stockholders' Equity | ||||||
Stock-based compensation | 63,356 | 63,356 | ||||
Exercise of stock options | $ 27 | 92,336 | 92,363 | |||
Exercise of stock options (in shares) | 5,490 | |||||
Unrealized gain, net on available-for-sale securities | 283 | 283 | ||||
Adjustment to excess tax benefits from prior periods | 3,649 | 3,649 | ||||
Repurchase of common stock | $ (707,300) | (707,300) | ||||
Repurchase of common stock (in shares) | (12,468) | |||||
Foreign currency translation | 194 | 194 | ||||
Net income | 1,107,835 | 1,107,835 | ||||
Balance at Dec. 31, 2019 | $ 3,182 | 4,397,511 | 5,022,480 | (32,387) | $ (5,219,505) | 4,171,281 |
Balance (in shares) at Dec. 31, 2019 | 636,460 | (99,762) | ||||
Increase (Decrease) in Stockholders' Equity | ||||||
Stock-based compensation | 67,546 | 67,546 | ||||
Exercise of stock options | $ 11 | 72,925 | 72,936 | |||
Exercise of stock options (in shares) | 2,202 | |||||
Unrealized gain, net on available-for-sale securities | 110 | 110 | ||||
Repurchase of common stock | $ (595,918) | (595,918) | ||||
Repurchase of common stock (in shares) | (10,803) | |||||
Foreign currency translation | 35,531 | (35,531) | ||||
Net income | 1,409,594 | 1,409,594 | ||||
Balance at Dec. 31, 2020 | $ 3,193 | 4,537,982 | 6,432,074 | 3,034 | $ (5,815,423) | 5,160,860 |
Balance (in shares) at Dec. 31, 2020 | 638,662 | (110,565) | ||||
Increase (Decrease) in Stockholders' Equity | ||||||
Stock-based compensation | 68,922 | 68,922 | ||||
Exercise of stock options | $ 7 | 45,716 | 45,723 | |||
Exercise of stock options (in shares) | 1,381 | |||||
Unrealized loss, net on available-for-sale securities | (1,041) | (1,041) | ||||
Repurchase of common stock | $ (13,830) | (13,830) | ||||
Repurchase of common stock (in shares) | (155) | |||||
Foreign currency translation | (71,158) | (71,158) | ||||
Net income | 1,377,475 | 1,377,475 | ||||
Balance at Dec. 31, 2021 | $ 3,200 | $ 4,652,620 | $ 7,809,549 | $ (69,165) | $ (5,829,253) | $ 6,566,951 |
Balance (in shares) at Dec. 31, 2021 | 640,043 | (110,720) |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
CASH FLOWS FROM OPERATING ACTIVITIES: | |||
Net income | $ 1,377,475 | $ 1,409,594 | $ 1,107,835 |
Adjustments to reconcile net income to net cash provided by operating activities: | |||
Depreciation and amortization | 50,155 | 57,030 | 60,727 |
Non-cash lease expense | 4,107 | 3,943 | 4,087 |
Gain on disposal of property and equipment | (1,013) | (350) | (252) |
Loss on impairment of intangibles | 0 | 8,700 | 0 |
Stock-based compensation | 70,483 | 70,289 | 63,356 |
Deferred income taxes | 16,429 | (156,873) | 1,263 |
Effect on cash of changes in operating assets and liabilities: | |||
Accounts receivable | (254,228) | (119,672) | (59,941) |
Inventories | (277,793) | 30,304 | (85,222) |
Prepaid expenses and other assets | (29,341) | 1,024 | (13,774) |
Prepaid income taxes | (10,919) | 5,516 | 9,481 |
Accounts payable | 114,297 | 18,696 | 28,832 |
Accrued liabilities | 71,586 | 26,113 | (14,018) |
Accrued promotional allowances | 31,498 | 13,762 | 21,943 |
Accrued compensation | 7,950 | 7,501 | 7,228 |
Income taxes payable | 7,221 | 10,422 | 8,105 |
Other liabilities | 492 | (356) | (1,030) |
Deferred revenue | (22,658) | (21,480) | (24,858) |
Net cash provided by operating activities | 1,155,741 | 1,364,163 | 1,113,762 |
CASH FLOWS FROM INVESTING ACTIVITIES: | |||
Sales of available-for-sale investments | 1,488,599 | 920,196 | 851,436 |
Proceeds from sale of property and equipment | 1,328 | 993 | 1,239 |
Purchases of available-for-sale investments | (2,413,143) | (1,299,981) | (1,067,736) |
Purchases of property and equipment | (43,868) | (48,722) | (101,661) |
Additions to intangibles | (13,585) | (18,550) | (8,737) |
Increase in other assets | (11,353) | (26,423) | (1,265) |
Net cash used in investing activities | (992,022) | (472,487) | (326,724) |
CASH FLOWS FROM FINANCING ACTIVITIES: | |||
Borrowings (payments) on debt | 2,928 | (3,086) | (13,569) |
Issuance of common stock | 45,723 | 72,936 | 92,363 |
Purchases of common stock held in treasury | (13,830) | (595,918) | (707,300) |
Net cash provided by (used in) financing activities | 34,821 | (526,068) | (628,506) |
Effect of exchange rate changes on cash and cash equivalents | (52,491) | 16,848 | 1,912 |
NET INCREASE IN CASH AND CASH EQUIVALENTS | 146,049 | 382,456 | 160,444 |
CASH AND CASH EQUIVALENTS, beginning of year | 1,180,413 | 797,957 | 637,513 |
CASH AND CASH EQUIVALENTS, end of year | 1,326,462 | 1,180,413 | 797,957 |
Cash paid during the period for: | |||
Interest | 134 | 44 | 320 |
Income taxes | $ 420,521 | $ 355,509 | $ 293,810 |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS SUPPLEMENTAL DISCLOSURE OF NON-CASH ITEMS (Parenthetical) - USD ($) $ in Thousands | 12 Months Ended | 24 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2021 | |
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS NON-CASH SUPPLEMENTAL DATA | ||||
Accrued liabilities for intangible assets | $ 14,000 | $ 9,800 | $ 12,800 | |
Accounts payable for purchase of available-for-sale short-term investment | $ 8,700 | $ 0 |
ORGANIZATION AND SUMMARY OF SIG
ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 12 Months Ended |
Dec. 31, 2021 | |
ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |
ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 1. ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Organization Nature of Operations Basis of Presentation Principles of Consolidation Business Combinations Cash and Cash Equivalents Investments Accounts Receivable – Inventories Property and Equipment three Goodwill Other Intangibles Leases Long-Lived Assets Foreign Currency Translation and Transactions The Company has not designated its foreign currency exchange contracts as hedge transactions under FASB ASC 815. Therefore, gains and losses on the Company’s foreign currency exchange contracts are recognized in other income, net, in the consolidated statements of income, and are largely offset by the changes in the fair value of the underlying economically hedged item. For the years ended December 31, 2021, 2020 and 2019, aggregate foreign currency transaction gains (losses), including the gains or losses on forward currency exchange contracts, amounted to $0.3 million, ($11.2) million and ($4.1) million, respectively, and have been recorded in other income, net, in the accompanying consolidated statements of income. Revenue Recognition Cost of Sales Operating Expenses Freight-Out Costs Advertising and Promotional Expenses Income Taxes The Company assesses its income tax positions and records tax benefits for all years subject to examination based upon the Company’s evaluation of the facts, circumstances and information available at the reporting date. For those tax positions where there is a greater than 50% likelihood that a tax benefit will be sustained, the Company has recorded the largest amount of tax benefit that may potentially be realized upon ultimate settlement with a taxing authority that has full knowledge of all relevant information. For those income tax positions where there is less than 50% likelihood that a tax benefit will be sustained, no tax benefit has been recognized in the financial statements. Stock-Based Compensation Net Income Per Common Share Concentration of Risk – The Coca-Cola Company (“TCCC”), through certain wholly-owned subsidiaries (the “TCCC Subsidiaries”), accounted for approximately 2%of the Company’s net sales for the years ended December 31, 2021, 2020 and 2019. Coca-Cola Consolidated, Inc. accounted for approximately 12%, 12% and 13% of the Company’s net sales for the years ended December 31, 2021, 2020 and 2019, respectively. Reyes Coca-Cola Bottling, LLC accounted for approximately 10%, 11% and 11% of the Company’s net sales for the years ended December 31, 2021, 2020 and 2019, respectively. Coca-Cola Europacific Partners accounted for approximately 12%, 10% and 10% of the Company’s net sales for the years ended December 31, 2021, 2020 and 2019, respectively. Credit Risk Fair Value of Financial Instruments Use of Estimates Recent Accounting Pronouncements – In October 2021, the FASB issued Accounting Standards Update (“ASU”) No. 2021-08, “Accounting for Contract Assets and Contract Liabilities from Contracts with Customers (Topic 805)”. ASU No. 2021-08 requires an acquirer in a business combination to recognize and measure contract assets and contract liabilities (deferred revenue) from acquired contracts using the revenue recognition guidance in Topic 606. At the acquisition date, the acquirer applies the revenue model as if it had originated the acquired contracts. The ASU is effective for annual periods beginning after December 15, 2022, including interim periods within those fiscal years. Adoption of the ASU should be applied prospectively. Early adoption is also permitted, including adoption in an interim period. If early adopted, the amendments are applied retrospectively to all business combinations for which the acquisition date occurred during the fiscal year of adoption. The Company is currently evaluating the impact of ASU No. 2021-08 on its financial position, results of operations and liquidity. |
REVENUE RECOGNITION
REVENUE RECOGNITION | 12 Months Ended |
Dec. 31, 2021 | |
REVENUE RECOGNITION | |
REVENUE RECOGNITION | 2. REVENUE RECOGNITION Revenues are accounted for in accordance with ASC 606 “Revenue from Contracts with Consumers”. The Company has three operating and reportable The Company’s Monster Energy® Drinks segment generates net operating revenues by selling ready-to-drink packaged energy drinks primarily to bottlers and full service beverage bottlers/distributors (“bottlers/distributors”). In some cases, the Company sells ready-to-drink packaged energy drinks directly to retail grocery and specialty chains, wholesalers, club stores, mass merchandisers, convenience chains, drug stores, foodservice customers, value stores, e-commerce retailers and the military. The Company’s Strategic Brands segment primarily generates net operating revenues by selling “concentrates” and/or “beverage bases” to authorized bottling and canning operations. Such bottlers generally combine the concentrates and/or beverage bases with sweeteners, water and other ingredients to produce ready-to-drink packaged energy drinks. The ready-to-drink packaged energy drinks are then sold by such bottlers to other bottlers/distributors and to retail grocery and specialty chains, wholesalers, club stores, mass merchandisers, convenience chains, foodservice customers, drug stores, value stores, e-commerce retailers and the military. To a lesser extent, the Strategic Brands segment generates net operating revenues by selling certain ready-to-drink packaged energy drinks to bottlers/distributors. The majority of the Company’s revenue is recognized when it satisfies a single performance obligation by transferring control of its products to a customer. Control is generally transferred when the Company’s products are either shipped or delivered based on the terms contained within the underlying contracts or agreements. Certain of the Company’s bottlers/distributors may also perform a separate function as a co-packer on the Company’s behalf. In such cases, control of the Company’s products passes to such bottlers/distributors when they notify the Company that they have taken possession or transferred the relevant portion of the Company’s finished goods. The Company’s general payment terms are short-term in duration. The Company does not have significant financing components or payment terms. The Company did not have any material unsatisfied performance obligations as of December 31, 2021 and December 31, 2020. The Company excludes from revenues all taxes assessed by a governmental authority that are imposed on the sale of its products and collected from customers. Distribution expenses to transport the Company’s products, where applicable, and warehousing expense after manufacture are accounted for within operating expenses in the consolidated statements of income. Promotional and other allowances (variable consideration) recorded as a reduction to net sales, primarily include consideration given to the Company’s bottlers/distributors or retail customers including, but not limited to the following: ● discounts granted off list prices to support price promotions to end-consumers by retailers; ● reimbursements given to the Company’s bottlers/distributors for agreed portions of their promotional spend with retailers, including slotting, shelf space allowances and other fees for both new and existing products; ● the Company’s agreed share of fees given to bottlers/distributors and/or directly to retailers for advertising, in-store marketing and promotional activities; ● the Company’s agreed share of slotting, shelf space allowances and other fees given directly to retailers, club stores and/or wholesalers; ● incentives given to the Company’s bottlers/distributors and/or retailers for achieving or exceeding certain predetermined sales goals; ● discounted or free products; ● contractual fees given to the Company’s bottlers/distributors related to sales made directly by the Company to certain customers that fall within the bottlers’/distributors’ sales territories; and ● commissions to TCCC based on the Company’s sales to wholly-owned subsidiaries of TCCC (the “TCCC Subsidiaries”) and/or to TCCC bottlers/distributors accounted for under the equity method by TCCC (the “TCCC Related Parties”). The Company’s promotional allowance programs with its bottlers/distributors and/or retailers are executed through separate agreements in the ordinary course of business. These agreements generally provide for one or more of the arrangements described above and are of varying durations, typically ranging from one week to one year. The Company’s promotional and other allowances are calculated based on various programs with bottlers/distributors and retail customers, and accruals are established at the time of initial product sale for the Company’s anticipated liabilities. These accruals are based on agreed upon terms as well as the Company’s historical experience with similar programs and require management’s judgment with respect to estimating consumer participation and/or bottler/distributor and retail customer performance levels. Differences between such estimated expenses and actual expenses for promotional and other allowance costs have historically been insignificant and are recognized in earnings in the period such differences are determined. Amounts received pursuant to new and/or amended distribution agreements entered into with certain bottlers/distributors relating to the costs associated with terminating the Company’s prior distributors, are accounted for as deferred revenue and recognized as revenue ratably over the anticipated life of the respective distribution agreements, generally over 20 years. The Company also sells and/or enters into license agreements that generate revenues associated with third-party sales of non-beverage products bearing the Company’s trademarks including, but not limited to, clothing, backpacks, hats, t-shirts, jackets, helmets and automotive wheels. Management believes that adequate provision has been made for cash discounts, returns and spoilage based on the Company’s historical experience. Disaggregation of Revenue The following table disaggregates the Company’s revenue by geographical markets and reportable segments: Year Ended December 31, 2021 Latin America U.S. and and Net Sales Canada EMEA 1 Asia Pacific Caribbean Total Monster Energy® Drinks $ 3,455,704 $ 1,004,005 $ 446,023 $ 314,941 $ 5,220,673 Strategic Brands 158,390 99,423 26,811 10,138 294,762 Other 25,917 — — — 25,917 Total Net Sales $ 3,640,011 $ 1,103,428 $ 472,834 $ 325,079 $ 5,541,352 Year Ended December 31, 2020 Latin America U.S. and and Net Sales Canada EMEA 1 Asia Pacific Caribbean Total Monster Energy® Drinks $ 3,020,667 $ 675,045 $ 400,317 $ 209,217 $ 4,305,246 Strategic Brands 166,861 70,782 23,475 5,236 266,354 Other 27,038 — — — 27,038 Total Net Sales $ 3,214,566 $ 745,827 $ 423,792 $ 214,453 $ 4,598,638 Year Ended December 31, 2019 Latin America U.S. and and Net Sales Canada EMEA 1 Asia Pacific Caribbean Total Monster Energy® $ 2,799,701 $ 599,706 $ 326,684 $ 177,938 $ 3,904,029 Strategic Brands 173,968 74,803 25,060 1,094 274,925 Other 21,865 — — — 21,865 Total Net Sales $ 2,995,534 $ 674,509 $ 351,744 $ 179,032 $ 4,200,819 1 Europe, Middle East and Africa (“EMEA”) Contract Liabilities Amounts received from certain bottlers/distributors at inception of their distribution contracts or at the inception of certain sales/marketing programs are accounted for as deferred revenue. As of December 31, 2021 and 2020, the Company had $285.8 million and $309.9 million of deferred revenue, respectively, which is included in current and long-term deferred revenue in the Company’s consolidated balance sheet. During the years ended December 31, 2021, 2020 and 2019, $41.5 million, $42.1 million and $46.3 million, respectively, of deferred revenue, was recognized in net sales. See Note 10. |
LEASES
LEASES | 12 Months Ended |
Dec. 31, 2021 | |
LEASES | |
LEASES | 3. LEASES The Company leases identified assets comprising real estate and equipment. Real estate leases consist primarily of office and warehouse space and equipment leases consist of vehicles and warehouse equipment. At the inception of a contract, the Company assesses whether the contract is, or contains, a lease. The Company’s assessment is based on: (1) whether the contract involves the use of a distinct identified asset, (2) whether the Company obtains the right to substantially all the economic benefit from the use of the asset throughout the term, and (3) whether the Company has the right to direct the use of the asset. At inception of a lease, the Company allocates the consideration in the contract to each lease and non-lease component based on the component’s relative stand-alone price to determine the lease payments. Lease and non-lease components are accounted for separately. Leases are classified as either finance leases or operating leases based on criteria in ASC 842, “Leases”. The Company’s operating leases are comprised of real estate and warehouse equipment, and the Company’s finance leases are comprised of vehicles. Right-of-use (“ROU”) assets and lease liabilities are recognized at the lease commencement date based on the present value of lease payments over the lease term. As the Company’s leases generally do not provide an implicit rate, the Company uses its incremental borrowing rate based on the estimated rate of interest for collateralized borrowing over a similar term of the lease payments at commencement date. ROU assets also include any lease payments made and exclude lease incentives. Lease terms include options to extend or terminate the lease when it is reasonably certain that the Company will exercise that option. Certain of the Company’s real estate leases contain variable lease payments, including payments based on an index or rate. Variable lease payments based on an index or rate are initially measured using the index or rate in effect at the lease commencement date. Additional payments based on the change in an index or rate, or payments based on a change in the Company’s portion of real estate taxes and insurance, are recorded as a period expense when incurred. Lease expense for operating leases, consisting of lease payments, is recognized on a straight-line basis over the lease term and is included in operating expenses in the consolidated statement of income. Lease expense for finance leases consists of the amortization of the ROU asset on a straight-line basis over the asset’s estimated useful life and is included in operating expenses in the consolidated statement of income. Interest expense on finance leases is calculated using the amortized cost basis and is included in other income (expense), net in the consolidated statement of income. The Company’s leases have remaining lease terms of less than one year to 12 years, some of which include options extend options terminate The components of lease cost for the years ended December 31, 2021, 2020 and 2019 were as follows: 2021 2020 2019 Operating lease cost $ 4,614 $ 4,637 $ 4,899 Short-term lease cost 5,218 3,408 3,406 Variable lease cost 710 719 640 Finance leases: Amortization of ROU assets 546 626 436 Interest on lease liabilities 19 39 56 Finance lease cost 565 665 492 Total lease cost $ 11,107 $ 9,429 $ 9,437 Supplemental cash flow information for leases for the years ended December 31, 2021, 2020 and 2019 were as follows: 2021 2020 2019 Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows from operating leases $ 4,123 $ 3,982 $ 4,077 Operating cash flows from finance leases 19 39 56 Financing cash flows from finance leases 2,698 3,086 2,223 ROU assets obtained in exchange for lease obligations: Finance leases 2,878 2,417 2,866 Operating leases 4,313 3,003 34,931 ROU assets for operating and finance leases recognized in the consolidated balance sheets were comprised of the following at: December 31, 2021 Real Estate Equipment Total Balance Sheet Location Operating leases $ 22,518 $ 639 $ 23,157 Other Assets Finance leases — 2,646 2,646 Property and Equipment, net December 31, 2020 Real Estate Equipment Total Balance Sheet Location Operating leases $ 22,565 $ 189 $ 22,754 Other Assets Finance leases — 2,120 2,120 Property and Equipment, net Operating and finance lease liabilities recognized in the consolidated balance sheets were as follows at: December 31, 2021 Operating Leases Finance Leases Accrued liabilities $ 3,990 $ 960 Other liabilities 17,389 41 Total $ 21,379 $ 1,001 December 31, 2020 Operating Leases Finance Leases Accrued liabilities $ 3,171 $ 799 Other liabilities 17,342 24 Total $ 20,513 $ 823 The weighted-average remaining lease terms and weighted-average discount rates for operating and finance leases were as follows at: December 31, 2021 Operating Leases Finance Leases Weighted-average remaining lease term (years) 8.1 0.7 Weighted-average discount rate 3.5 % 1.3 % December 31, 2020 Operating Leases Finance Leases Weighted-average remaining lease term (years) 9.4 0.6 Weighted-average discount rate 3.6 % 1.9 % The following table reconciles the undiscounted future lease payments for operating and finance leases to the operating and finance leases recorded in the consolidated balance sheet at December 31, 2021: Undiscounted Future Lease Payments Operating Leases Finance Leases 2022 $ 4,605 $ 964 2023 3,821 21 2024 2,978 13 2025 1,669 8 2026 1,692 — 2027 and thereafter 9,949 — Total lease payments 24,714 1,006 Less imputed interest (3,335) (5) Total $ 21,379 $ 1,001 As of December 31, 2021, the Company did not have any significant additional operating or finance leases that had not yet commenced. |
INVESTMENTS
INVESTMENTS | 12 Months Ended |
Dec. 31, 2021 | |
INVESTMENTS | |
INVESTMENTS | 4. INVESTMENTS The following table summarizes the Company’s investments at: Continuous Continuous Gross Gross Unrealized Unrealized Unrealized Unrealized Loss Position Loss Position Amortized Holding Holding Fair less than 12 greater than 12 December 31, 2021 Cost Gains Losses Value Months Months Available-for-sale Short-term: Commercial paper $ 334,077 $ — $ — $ 334,077 $ — $ — Certificates of deposit 44,502 — — 44,502 — — Municipal securities 666 — — 666 — — U.S. government agency securities 62,687 — 26 62,661 26 — U.S. treasuries 1,308,536 2 717 1,307,821 717 — Long-term: U.S. government agency securities 12,500 — 24 12,476 24 — U.S. treasuries 87,133 — 190 86,943 190 — Total $ 1,850,101 $ 2 $ 957 $ 1,849,146 $ 957 $ — Continuous Continuous Gross Gross Unrealized Unrealized Unrealized Unrealized Loss Position Loss Position Amortized Holding Holding Fair less than 12 greater than 12 December 31, 2020 Cost Gains Losses Value Months Months Available-for-sale Short-term: Commercial paper $ 119,886 $ — $ — $ 119,886 $ — $ — Certificates of deposit 20,387 — — 20,387 — — Municipal securities 9,083 — — 9,083 — — U.S. government agency securities 81,521 13 3 81,531 3 — U.S. treasuries 650,386 150 69 650,467 69 — Long-term: U.S. government agency securities 10,350 1 — 10,351 — — U.S. treasuries 33,946 1 7 33,940 7 — Total $ 925,559 $ 165 $ 79 $ 925,645 $ 79 $ — During the years ended December 31, 2021, 2020 and 2019, realized gains or losses recognized on the sale of investments were not significant. The Company’s investments at December 31, 2021 and 2020 carried investment grade credit ratings. The following table summarizes the underlying contractual maturities of the Company’s investments at: December 31, 2021 December 31, 2020 Amortized Cost Fair Value Amortized Cost Fair Value Less than 1 year: Commercial paper $ 334,077 $ 334,077 $ 119,886 $ 119,886 Municipal securities 666 666 9,083 9,083 U.S. government agency securities 62,687 62,661 81,521 81,531 Certificates of deposit 44,502 44,502 20,387 20,387 U.S. treasuries 1,308,536 1,307,821 650,386 650,467 Due 1 - 10 years: U.S. treasuries 87,133 86,943 33,946 33,940 U.S. government agency securities 12,500 12,476 10,350 10,351 Total $ 1,850,101 $ 1,849,146 $ 925,559 $ 925,645 |
FAIR VALUE OF CERTAIN FINANCIAL
FAIR VALUE OF CERTAIN FINANCIAL ASSETS AND LIABILITIES | 12 Months Ended |
Dec. 31, 2021 | |
FAIR VALUE OF CERTAIN FINANCIAL ASSETS AND LIABILITIES | |
FAIR VALUE OF CERTAIN FINANCIAL ASSETS AND LIABILITIES | 5. FAIR VALUE OF CERTAIN FINANCIAL ASSETS AND LIABILITIES FASB ASC 820 provides a framework for measuring fair value and requires expanded disclosures regarding fair value measurements. FASB ASC 820 defines fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. FASB ASC 820 also establishes a fair value hierarchy which requires an entity to maximize the use of observable inputs, where available. The three levels of inputs required by the standard that the Company uses to measure fair value are summarized below. ● Level 1: 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; quoted prices 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 related assets or liabilities. ● Level 3: Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities. FASB ASC 820 requires the use of observable market inputs (quoted market prices) when measuring fair value and requires a Level 1 quoted price to be used to measure fair value whenever possible. The following tables present the fair value of Company’s financial assets and liabilities that are recorded at fair value on a recurring basis, segregated among the appropriate levels within the fair value hierarchy at: December 31, 2021 Level 1 Level 2 Level 3 Total Cash $ 749,089 $ — $ — $ 749,089 Money market funds 440,826 — — 440,826 Certificates of deposit — 44,502 — 44,502 Commercial paper — 335,477 — 335,477 Municipal securities — 2,428 — 2,428 U.S. government agency securities — 75,137 — 75,137 U.S. treasuries — 1,528,149 — 1,528,149 Foreign currency derivatives — (278) — (278) Total $ 1,189,915 $ 1,985,415 $ — $ 3,175,330 Amounts included in: Cash and cash equivalents $ 1,189,915 $ 136,547 $ — $ 1,326,462 Short-term investments — 1,749,727 — 1,749,727 Accounts receivable, net — 654 — 654 Investments — 99,419 — 99,419 Accrued liabilities — (932) — (932) Total $ 1,189,915 $ 1,985,415 $ — $ 3,175,330 December 31, 2020 Level 1 Level 2 Level 3 Total Cash $ 796,421 $ — $ — $ 796,421 Money market funds 352,730 — — 352,730 Certificates of deposit — 23,137 — 23,137 Commercial paper — 130,883 — 130,883 Municipal securities — 9,083 — 9,083 U.S. government agency securities — 91,882 — 91,882 U.S. treasuries — 701,922 — 701,922 Foreign currency derivatives — (2,578) — (2,578) Total $ 1,149,151 $ 954,329 $ — $ 2,103,480 Amounts included in: Cash and cash equivalents $ 1,149,151 $ 31,262 $ — $ 1,180,413 Short-term investments — 881,354 — 881,354 Accounts receivable, net — 69 — 69 Investments — 44,291 — 44,291 Accrued liabilities — (2,647) — (2,647) Total $ 1,149,151 $ 954,329 $ — $ 2,103,480 All of the Company’s short-term and long-term investments are classified within Level 1 or Level 2 of the fair value hierarchy. The Company’s valuation of its Level 1 investments is based on quoted market prices in active markets for identical securities. The Company’s valuation of its Level 2 investments is based on other observable inputs, specifically a market approach which utilizes valuation models, pricing systems, mathematical tools and other relevant information for the same or similar securities. The Company’s valuation of its Level 2 foreign currency exchange contracts is based on quoted market prices of the same or similar instruments, adjusted for counterparty risk. There were no transfers between Level 1 and Level 2 measurements during the years ended December 31, 2021 and 2020, and there were no changes in the Company’s valuation techniques. |
DERIVATIVE INSTRUMENTS AND HEDG
DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES | 12 Months Ended |
Dec. 31, 2021 | |
DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES | |
DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES | 6 . DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES The Company is exposed to foreign currency exchange rate risks related primarily to its foreign business operations. During the years ended December 31, 2021, 2020 and 2019, the Company entered into forward currency exchange contracts with financial institutions to create an economic hedge to specifically manage a portion of the foreign exchange risk exposure associated with certain consolidated subsidiaries’ non-functional currency denominated assets and liabilities. All foreign currency exchange contracts entered into by the Company that were outstanding as of December 31, 2021 have terms of three months or less. The Company does not enter into forward currency exchange contracts for speculation or trading purposes. The Company has not designated its foreign currency exchange contracts as hedge transactions under FASB ASC 815. Therefore, gains and losses on the Company’s foreign currency exchange contracts are recognized in other income, net, in the consolidated statements of income, and are largely offset by the changes in the fair value of the underlying economically hedged item. The notional amount and fair value of all outstanding foreign currency derivative instruments in the consolidated balance sheets consist of the following at: December 31, 2021 Derivatives not designated as hedging instruments under Notional Fair FASB ASC 815-20 Amount Value Balance Sheet Location Assets: Foreign currency exchange contracts: Receive SGD/pay USD 16,544 297 Accounts receivable, net Receive USD/pay COP 9,754 296 Accounts receivable, net Receive RSD/pay USD 9,837 46 Accounts receivable, net Receive USD/pay RUB 7,175 15 Accounts receivable, net Liabilities: Foreign currency exchange contracts: Receive USD/pay GBP $ 29,929 $ (666) Accrued liabilities Receive USD/pay AUD 2,602 (88) Accrued liabilities Receive USD/pay CNY 12,230 (74) Accrued liabilities Receive USD/pay NZD 2,693 (45) Accrued liabilities Receive USD/pay EUR 3,045 (29) Accrued liabilities Receive USD/pay ZAR 4,140 (21) Accrued liabilities Receive USD/pay DKK 1,461 (9) Accrued liabilities December 31, 2020 Derivatives not designated as hedging instruments under Notional Fair FASB ASC 815-20 Amount Value Balance Sheet Location Assets: Foreign currency exchange contracts: Receive SGD/pay USD $ 18,713 $ 41 Accounts receivable, net Receive RSD/pay USD 10,127 28 Accounts receivable, net Liabilities: Foreign currency exchange contracts: Receive EUR/pay USD $ 1,298,899 $ (1,768) Accrued liabilities Receive USD/pay GBP 35,256 (416) Accrued liabilities Receive USD/pay AUD 8,508 (130) Accrued liabilities Receive USD/pay ZAR 2,403 (106) Accrued liabilities Receive USD/pay COP 5,436 (93) Accrued liabilities Receive USD/pay CNY 12,344 (50) Accrued liabilities Receive USD/pay RUB 7,780 (40) Accrued liabilities Receive NOK/pay USD 4,411 (18) Accrued liabilities Receive USD/pay NZD 2,290 (13) Accrued liabilities Receive SEK/pay USD 2,275 (10) Accrued liabilities Receive USD/pay DKK 3,151 (3) Accrued liabilities The net gain (loss) on derivative instruments in the consolidated statements of income was as follows: Amount of gain (loss) recognized in income on derivatives Derivatives not designated as Location of gain (loss) Year ended hedging instruments under recognized in income on December 31, December 31, December 31, FASB ASC 815-20 derivatives 2021 2020 2019 Foreign currency exchange contracts Other income (expense), net $ (5,445) $ (3,317) $ (2,555) |
INVENTORIES
INVENTORIES | 12 Months Ended |
Dec. 31, 2021 | |
INVENTORIES | |
INVENTORIES | 7 . INVENTORIES Inventories consist of the following at December 31: 2021 2020 Raw materials $ 349,865 $ 155,166 Finished goods 243,492 177,919 $ 593,357 $ 333,085 |
PROPERTY AND EQUIPMENT, Net
PROPERTY AND EQUIPMENT, Net | 12 Months Ended |
Dec. 31, 2021 | |
PROPERTY AND EQUIPMENT, Net | |
PROPERTY AND EQUIPMENT, Net | 8. PROPERTY AND EQUIPMENT, Net Property and equipment consist of the following at December 31: 2021 2020 Land $ 85,455 $ 85,876 Leasehold improvements 11,845 11,524 Furniture and fixtures 8,274 8,271 Office and computer equipment 21,601 21,657 Computer software 8,383 6,945 Equipment 190,333 185,348 Buildings 167,243 156,616 Vehicles 45,404 43,173 538,538 519,410 Less: accumulated depreciation and amortization (224,785) (204,754) $ 313,753 $ 314,656 Total depreciation and amortization expense recorded was $45.7 million, $49.3 million and $49.1 million for the years ended December 31, 2021, 2020 and 2019, respectively. |
GOODWILL AND OTHER INTANGIBLE A
GOODWILL AND OTHER INTANGIBLE ASSETS | 12 Months Ended |
Dec. 31, 2021 | |
GOODWILL AND OTHER INTANGIBLE ASSETS | |
GOODWILL AND OTHER INTANGIBLE ASSETS | 9. GOODWILL AND OTHER INTANGIBLE ASSETS The following is a roll-forward of goodwill for the years ended December 31, 2021 and 2020 by reportable segment: Monster Energy® Strategic Drinks Brands Other Total Balance at December 31, 2020 $ 693,644 $ 637,999 $ — $ 1,331,643 Acquisitions — — — — Balance at December 31, 2021 $ 693,644 $ 637,999 $ — $ 1,331,643 Monster Energy® Strategic Drinks Brands Other Total Balance at December 31, 2019 $ 693,644 $ 637,999 $ — $ 1,331,643 Acquisitions — — — — Balance at December 31, 2020 $ 693,644 $ 637,999 $ — $ 1,331,643 Intangible assets consist of the following at: December 31, December 31, 2021 2020 Amortizing intangibles $ 66,872 $ 66,875 Accumulated amortization (61,227) (56,801) 5,645 10,074 Non-amortizing intangibles 1,066,741 1,048,972 $ 1,072,386 $ 1,059,046 Amortizing intangibles primarily consist of customer relationships. All amortizing intangibles have been assigned an estimated finite useful life and such intangibles are amortized on a straight-line basis over the number of years that approximate their respective useful lives, generally five The following is the future estimated amortization expense related to amortizing intangibles as of December 31, 2021: Year Ending December 31: 2022 $ 4,405 2023 1,112 2024 14 2025 13 2026 13 2027 and thereafter 88 $ 5,645 At December 31, 2021, non-amortizing intangibles primarily consist of indefinite-lived tradenames, flavors and formulas. |
DISTRIBUTION AGREEMENTS
DISTRIBUTION AGREEMENTS | 12 Months Ended |
Dec. 31, 2021 | |
DISTRIBUTION AGREEMENTS | |
DISTRIBUTION AGREEMENTS | 10. DISTRIBUTION AGREEMENTS In accordance with FASB ASC 420 “Exit or Disposal Cost Obligations”, the Company expenses distributor termination costs in the period in which the written notification of termination occurs. As a result, the Company incurred termination costs of $5.3 million, $0.2 million and $11.3 million for the years ended December 31, 2021, 2020 and 2019, respectively. Such termination costs have been expensed in full and are included in operating expenses in the consolidated statements of income for the years ended December 31, 2021, 2020 and 2019. In the normal course of business, amounts received pursuant to new and/or amended distribution agreements entered into with certain bottlers/distributors, relating to the costs associated with terminating agreements with the Company’s prior distributors, are accounted for as deferred revenue and are recognized as revenue ratably over the anticipated life of the respective distribution agreement, generally 20 years. Revenue recognized was $21.5 million, $21.4 million and $25.0 million for the years ended December 31, 2021, 2020 and 2019, respectively. |
DEBT
DEBT | 12 Months Ended |
Dec. 31, 2021 | |
DEBT | |
DEBT | 11. DEBT The Company entered into a credit facility with Comerica Bank (“Comerica”) consisting of a revolving line of credit, which was amended in April 2020, under which the Company may borrow up to $10.0 million of non-collateralized debt. The revolving line of credit is effective through June 1, 2025. Interest on borrowings under the line of credit is based on Comerica’s base (prime) rate minus 1.00% to 1.50%, or London Interbank Offered Rates plus an additional percentage of 1.25% to 1.75%, depending upon certain financial ratios maintained by the Company. The Company had no outstanding borrowings on this line of credit at December 31, 2021. Under this revolving line of credit, the Company may also issue standby Letters of Credit with an aggregate amount of up to $4.0 million. The fee on the standby Letters of Credit ranges from 1.00% to 1.50% depending upon certain financial ratios maintained by the Company. The Company had no outstanding standby Letters of Credit at December 31, 2021. The Company has a credit facility with HSBC Bank (China) Company Limited, Shanghai Branch, of $15.0 million. At December 31, 2021, the interest rate on borrowings under the line of credit was 5.5%. As of December 31, 2021, $5.8 million was outstanding on this line of credit. |
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 12 Months Ended |
Dec. 31, 2021 | |
COMMITMENTS AND CONTINGENCIES | |
COMMITMENTS AND CONTINGENCIES | 12. COMMITMENTS AND CONTINGENCIES Contractual Obligations Year Ending December 31: 2022 $ 236,698 2023 57,848 2024 10,497 2025 10 2026 — 2027 and thereafter — $ 305,053 Purchase Commitments The Company purchases various raw material items, including, but not limited to, flavors, ingredients, supplement ingredients, containers, milk, glucose, sucralose, cream and protein, from a limited number of suppliers. An interruption in supply from any of such resources could result in the Company’s inability to produce certain products for limited or possibly extended periods of time. The aggregate value of purchases from suppliers of such limited resources described above for the years ended December 31, 2021, 2020 and 2019 was $698.0 million, $401.8 million and $335.3 million, respectively. Guarantees Litigation The Company evaluates, on a quarterly basis, developments in legal proceedings and other matters that could cause an increase or decrease in the amount of the liability that is accrued, if any, and any related insurance reimbursements. As of December 31, 2021, no loss contingencies were included in the Company’s consolidated balance sheet. |
ACCUMULATED OTHER COMPREHENSIVE
ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) | 12 Months Ended |
Dec. 31, 2021 | |
ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) | |
ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) | 13. ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) The components of accumulated other comprehensive income (loss) are as follows at December 31: 2021 2020 Accumulated net unrealized (loss) gain on available-for-sale securities $ (956) $ 84 Foreign currency translation adjustments, net of tax (68,209) 2,950 Total accumulated other comprehensive (loss) income $ (69,165) $ 3,034 |
TREASURY STOCK PURCHASE
TREASURY STOCK PURCHASE | 12 Months Ended |
Dec. 31, 2021 | |
TREASURY STOCK PURCHASE | |
TREASURY STOCK PURCHASE | 14. TREASURY STOCK PURCHASE On March 13, 2020, the Company’s Board of Directors authorized a new share repurchase program for the purchase of up to $500.0 million of the Company’s outstanding common stock (the “March 2020 Repurchase Plan”). During the year ended December 31, 2021, no shares were purchased under the March 2020 Repurchase Plan. As of February 28, 2022, $441.5 million remained available for repurchase under the March 2020 Repurchase Plan. During the year ended December 31, 2021, 0.2 million shares of common stock were purchased from employees in lieu of cash payments for options exercised or withholding taxes due for a total amount of $13.8 million. While such purchases are considered common stock repurchases, they are not counted as purchases against the Company’s authorized share repurchase programs. Such shares are included in common stock in treasury in the accompanying consolidated balance sheet at December 31, 2021. |
STOCK-BASED COMPENSATION
STOCK-BASED COMPENSATION | 12 Months Ended |
Dec. 31, 2021 | |
STOCK-BASED COMPENSATION | |
STOCK-BASED COMPENSATION | 15. STOCK-BASED COMPENSATION The Company has two stock-based compensation plans under which shares were available for grant at December 31, 2021: (i) the Monster Beverage Corporation 2020 Omnibus Incentive Plan (the “2020 Omnibus Incentive Plan”), which includes the Monster Beverage Corporation Deferred Compensation Plan as a sub plan thereunder, and (ii) the Monster Beverage Corporation 2017 Compensation Plan for Non-Employee Directors, which includes the Monster Beverage Corporation Deferred Compensation Plan for Non-Employee Directors as a sub plan thereunder. The 2020 Omnibus Incentive Plan was approved by the Board of Directors on April 14, 2020 and approved by the stockholders of the Company at the annual meeting of the Company’s stockholders held on June 3, 2020 (the “Effective Date”). The 2020 Omnibus Incentive Plan replaced the Monster Beverage Corporation 2011 Omnibus Incentive Plan (the “2011 Omnibus Incentive Plan”). The 2020 Omnibus Incentive Plan provides for the granting of stock options, stock appreciation rights, restricted stock, restricted stock units, performance awards, and other share-based awards up to an aggregate of 46,169,367 shares of the Company’s common stock, comprised of 32,000,000 new shares of common stock reserved under the 2020 Omnibus Incentive Plan, which were authorized on the Effective Date, and 14,169,367 shares of common stock that were available for grant under the 2011 Omnibus Incentive Plan as of December 31, 2019 and prior to the Effective Date. Shares authorized under the 2020 Omnibus Incentive Plan are reduced by one (1) share for options or stock appreciation rights granted under the 2020 Omnibus Incentive Plan and for any grants after December 31, 2019 under the 2011 Omnibus Incentive Plan, and by 2.6 shares for each share granted or issued with respect to a Full Value Award under either the 2020 Omnibus Incentive Plan or for any shares granted after December 31, 2019 under the 2011 Omnibus Incentive Plan. A “Full Value Award” is an award other than an incentive stock option, a non-qualified stock option, or a stock appreciation right, which is settled by the issuance of shares. Options granted under the 2020 Omnibus Incentive Plan may be incentive stock options under Section 422 of the Internal Revenue Code, as amended (the “Code”), or non-qualified stock options. Shares previously granted under the 2011 Omnibus Incentive Plan after December 31, 2019 and prior to the Effective Date of the 2020 Omnibus Incentive Plan reduced the number of shares available for grant under the 2020 Omnibus Incentive Plan. As of December 31, 2021, 2,755,257 shares of the Company’s common stock have been granted, net of cancellations, and 42,513,457 shares (as adjusted for Full Value Awards) of the Company’s common stock remain available for grant under the 2020 Omnibus Incentive Plan. The Compensation Committee of the Board of Directors (the “Compensation Committee”) has sole and exclusive authority to grant stock awards to all employees who are not new hires and to all new hires who are subject to Section 16 of the Exchange Act (“Section 16”). Each of the Compensation Committee and the Executive Committee of the Board of Directors (the “Executive Committee”) independently has the authority to grant stock awards to (i) new hires and (ii) employees receiving a promotion, in each case, who are not Section 16 employees. Awards granted by the Executive Committee are not subject to approval or ratification by the Board of Directors or the Compensation Committee. Options granted under the 2020 Omnibus Incentive Plan generally vest over a three three In 2016, the Company adopted the Deferred Compensation Plan (as a sub plan to the 2011 Omnibus Incentive Plan), pursuant to which eligible employees may elect to defer cash and/or equity based compensation and to receive the deferred amounts, together with an investment return (positive or negative), either at a pre-determined time in the future or upon termination of their employment with the Company or its subsidiaries or affiliates that are participating employers under the Deferred Compensation Plan, as provided under the Deferred Compensation Plan and in relevant deferral elections. Deferrals under the Deferred Compensation Plan are unfunded and unsecured. As of December 31, 2021 deferrals under the Deferred Compensation Plan are solely comprised of cash compensation and equity compensation and are not material in the aggregate. In 2017, the Company adopted the 2017 Directors Plan, a successor plan to the 2009 Monster Beverage Corporation Stock Incentive Plan for Non-Employee Directors. The 2017 Directors Plan permits the granting of stock options, stock appreciation rights, restricted shares or restricted stock units, deferred awards, dividend equivalents, and other share based-awards up to an aggregate of 1,250,000 shares of common stock of the Company to non-employee directors of the Company. Each calendar year, a non-employee director will receive an annual retainer and annual equity award, as provided for in the 2017 Directors Plan, which may be modified from time to time. Currently, with respect to equity awards, each non-employee director receives an award of restricted stock units at each annual meeting of the Company’s stockholders or promptly thereafter. A non-employee director’s annual award of restricted stock units will generally vest on the earliest to occur of: (a) the last business day immediately preceding the annual meeting of the Company’s stockholders in the calendar year following the calendar year in which the grant date occurs, (b) a Change of Control (as defined in the 2017 Directors Plan), (c) the non-employee director’s death, or (d) the date of the non-employee director’s separation from service due to disability, so long as the non-employee director remains a non-employee director through such date. The Board of Directors may in its discretion award non-employee directors stock options, stock appreciation rights, restricted stock and other share-based awards in lieu of or in addition to restricted stock units. The Board of Directors may amend or terminate the 2017 Directors Plan at any time, subject to certain limitations set forth in the 2017 Directors Plan. As of December 31, 2021, 98,901 shares of the Company’s common stock had been granted under the 2017 Directors Plan, and 1,151,099 shares of the Company’s common stock remain available for grant. In 2017, the Company adopted the Deferred Compensation Plan for Non-Employee Directors (as a sub plan to the 2017 Directors Plan), pursuant to which the Board of Directors may permit non-employee directors to elect, at such times and in accordance with rules and procedures (or sub-plan) adopted by the Board of Directors (which are intended to comply with Section 409A of the Code, as applicable), to receive all or any portion of such non-employee director’s compensation, whether payable in cash or in equity, on a deferred basis. Deferrals under the Deferred Compensation Plan for Non-Employee Directors are unfunded and unsecured. As of December 31, 2021, deferrals under the Deferred Compensation Plan for Non-Employee Directors are solely comprised of cash compensation and equity compensation and are not material in the aggregate. The 2017 Directors Plan was adopted to effectuate any such deferrals. The 2017 Directors Plan is administered by the Board of Directors. Each award granted under the 2017 Directors Plan will be evidenced by a written agreement and will contain the terms and conditions that the Board of Directors deems appropriate. In February 2022, the Board of Directors amended and restated the 2017 Directors Plan to require each non-employee director to satisfy the share ownership guidelines set forth below, as may be modified by the Board of Directors from time to time. The current share ownership guidelines provide that non-employee directors of the Company must: ● Hold shares of Company common stock having a total value of five times the annual retainer payable to a non-employee director (excluding any portion of the annual retainer attributable to a non-employee director’s service as a member of a subcommittee, as a chair of a subcommittee or as the lead independent director, as applicable). For this purpose, deferred shares or deferred restricted stock units will be deemed held, to the extent vested. ● The minimum stock ownership level must be achieved by each non-employee director by the fifth anniversary of such non-employee director’s initial appointment to the Board of Directors. ● Once achieved, ownership of the guideline amount should be maintained for so long as the non-employee director retains his or her seat on the Board of Directors. ● There may be rare instances where these guidelines would place a hardship on a non-employee director. In these cases or in similar circumstances, the Board of Directors will make the final decision as to developing an alternative stock ownership guideline for a non-employee director that reflects the intention of these guidelines and his or her personal circumstances. The Company recorded $70.5 million, $70.3 million and $63.4 million of compensation expense relating to outstanding options, restricted stock units, performance share units and other share-based awards during the years ended December 31, 2021, 2020 and 2019, respectively. The tax benefit for tax deductions from non-qualified stock option exercises, disqualifying dispositions of incentive stock options and vesting of restricted stock units and performance share units for the years ended December 31, 2021, 2020 and 2019 was $6.8 million, $10.5 million and $25.9 million, respectively. Stock Options Under the Company’s stock-based compensation plans, all stock options granted through December 31, 2021 were granted at prices based on the fair value of the Company’s common stock on the date of grant. The Company records compensation expense for employee stock options based on the estimated fair value of the options on the date of grant using the Black-Scholes-Merton option pricing formula with the assumptions included in the table below. The Company records compensation expense for non-employee stock options based on the estimated fair value of the options as of the earlier of (1) the date at which a commitment for performance by the non-employee to earn the stock option is reached or (2) the date at which the non-employee’s performance is complete, using the Black-Scholes-Merton option pricing formula with the assumptions included in the table below. The Company uses historical data to determine the exercise behavior, volatility and forfeiture rate of the options. The following weighted-average assumptions were used to estimate the fair value of options granted during: 2021 2020 2019 Dividend yield 0.0 % 0.0 % 0.0 % Expected volatility 28.9 % 30.4 % 30.2 % Risk-free interest rate 0.85 % 0.70 % 2.37 % Expected term 5.8 Years 5.8 Years 6.0 Years Expected Volatility Risk-Free Interest Rate Expected Term The following table summarizes the Company’s activities with respect to its stock option plans as follows: Weighted- Weighted- Average Average Remaining Number of Exercise Contractual Aggregate Shares Price Per Term (in Intrinsic Options (in thousands) Share years) Value Outstanding at January 1, 2021 13,973 $ 44.93 5.7 $ 664,432 Granted 01/01/21 - 03/31/21 1,015 $ 88.95 Granted 04/01/21 - 06/30/21 13 $ 91.36 Granted 07/01/21 - 09/30/21 23 $ 95.33 Granted 10/01/21 - 12/31/21 12 $ 87.00 Exercised (1,037) $ 44.10 Cancelled or forfeited (139) $ 63.05 Outstanding at December 31, 2021 13,860 $ 48.19 5.1 $ 663,148 Vested and expected to vest in the future at December 31, 2021 13,633 $ 47.80 5.0 $ 657,633 Exercisable at December 31, 2021 9,644 $ 40.33 4.0 $ 537,261 The following table summarizes information about stock options outstanding and exercisable at December 31, 2021: Options Outstanding Options Exercisable Weighted Average Remaining Weighted Number Weighted Number Contractual Average Exercisable Average Range of Exercise Outstanding Term Exercise (In Exercise Prices ($) (In Thousands) (Years) Price ($) Thousands) Price ($) $ 15.71 - $ 17.99 1,395 1.4 $ 17.77 1,395 $ 17.77 $ 18.64 - $ 23.35 1,562 2.1 $ 23.08 1,562 $ 23.08 $ 36.05 - $ 36.05 9 3.0 $ 36.05 9 $ 36.05 $ 37.10 - $ 43.99 2,280 4.3 $ 43.47 2,272 $ 43.47 $ 44.73 - $ 45.16 1,410 3.4 $ 45.10 1,410 $ 45.10 $ 45.55 - $ 54.45 1,491 5.5 $ 48.21 1,058 $ 47.43 $ 55.14 - $ 57.95 153 7.1 $ 56.90 36 $ 56.57 $ 58.73 - $ 58.73 2,054 6.2 $ 58.73 1,084 $ 58.73 $ 58.77 - $ 58.77 4 6.6 $ 58.77 2 $ 58.77 $ 59.67 - $ 97.80 3,502 8.1 $ 69.29 816 $ 60.56 13,860 5.1 $ 48.19 9,644 $ 40.33 The weighted-average grant-date fair value of options granted during the years ended December 31, 2021, 2020 and 2019 was $25.80 per share, $18.82 per share and $20.17 per share, respectively. The total intrinsic value of options exercised during the years ended December 31, 2021, 2020 and 2019 was $51.2 million, $68.8 million and $220.2 million, respectively. Cash received from option exercises under all plans for the years ended December 31, 2021, 2020 and 2019 was $45.7 million, $72.9 million and $92.4 million, respectively. At December 31, 2021, there was $51.3 million of total unrecognized compensation expense related to non-vested options granted to employees under the Company’s share-based payment plans. That cost is expected to be recognized over a weighted-average period of 2.1 years. Restricted Stock Units and Performance Share Units The cost of stock-based compensation for restricted stock units and performance share units is measured based on the closing fair market value of the Company’s common stock at the date of grant. In the event that the Company has the option and intent to settle a restricted stock unit or performance share unit in cash, the award is classified as a liability and revalued at each balance sheet date. The following table summarizes the Company’s activities with respect to non-vested restricted stock units and performance share units as follows: Weighted Number of Average Shares (in Grant-Date thousands) Fair Value Non-vested at January 1, 2021 947 $ 60.52 Granted 01/01/21 - 03/31/21 1 304 $ 86.28 Granted 04/01/21 - 06/30/21 14 $ 92.14 Granted 07/01/21 - 09/30/21 1 $ 89.84 Granted 10/01/21 - 12/31/21 1 $ 89.95 Vested (344) $ 62.29 Forfeited/cancelled (13) $ 60.41 Non-vested at December 31, 2021 910 $ 69.02 1 The grant activity for performance share units is recorded based on the target performance level earning 100% of target performance share units. The actual number of performance share units earned could range from 0% to 200% of target dependent on the pre-established performance goals. The weighted-average grant-date fair value of restricted stock units and/or performance share units granted during the years ended December 31, 2021, 2020 and 2019 was $89.12, $62.97 and $59.79 per share, respectively. As of December 31, 2021, 0.8 million of restricted stock units and performance share units are expected to vest. At December 31, 2021, total unrecognized compensation expense relating to non-vested restricted stock units and performance share units was $34.8 million, which is expected to be recognized over a weighted-average period of 1.9 years. Other Share-Based Awards The Company has granted other share-based awards to certain employees that are payable in cash. These awards are classified as liabilities and are valued based on the fair value of the award at the grant date and are remeasured at each reporting date until settlement with compensation expense being recognized in proportion to the completed requisite service period up until date of settlement. At December 31, 2021, other share-based awards outstanding included grants that vest over three years payable in the first quarters of 2022, 2023 and 2024. At December 31, 2021, there was $0.7 million of total unrecognized compensation expense related to nonvested other share-based awards granted to employees under the Company’s stock-based compensation plans. That cost is expected to be recognized over a weighted-average period of 1.0 years. Employee and Non-Employee Share-Based Compensation Expense The table below shows the amounts recognized in the consolidated financial statements for the years ended December 31, 2021, 2020 and 2019 for share-based compensation related to employees and non-employees. Employee and non-employee share-based compensation expense of $70.5 million for the year ended December 31, 2021 is comprised of $8.3 million relating to incentive stock options, $1.6 million relating to other share-based awards and $60.6 million relating to non-qualified stock options, restricted units and performance units. Employee and non-employee share-based compensation expense of $70.3 million for the year ended December 31, 2020 is comprised of $9.4 million relating to incentive stock options, $2.7 million relating to other share-based awards and $58.2 million relating to non-qualified stock options, restricted units and performance units. Employee and non-employee share-based compensation expense of $63.4 million for the year ended December 31, 2019 is comprised of $10.0 million relating to incentive stock options and $53.4 million relating to non-qualified stock options and restricted units. 2021 2020 2019 Operating expenses $ 70,483 $ 70,289 $ 63,356 Total employee and non-employee share-based compensation expense included in income, before 70,483 70,289 63,356 Less: Amount of income tax benefit recognized in earnings (14,228) (15,499) (36,326) Amount charged against net income $ 56,255 $ 54,790 $ 27,030 |
INCOME TAXES
INCOME TAXES | 12 Months Ended |
Dec. 31, 2021 | |
INCOME TAXES | |
INCOME TAXES | 16. INCOME TAXES The Company evaluated the various provisions of the Tax Reform Act, including, the global intangible low-taxed income (“GILTI”) and the foreign derived intangible income provisions. The Company will treat any U.S. tax on foreign earnings under GILTI as a current period expense when incurred. The Company currently considers the earnings of its foreign entities (excluding Japan) to be permanently reinvested outside the United States based on estimates that future domestic cash generation will be sufficient to meet future domestic cash needs. Accordingly, deferred income taxes have not been recorded for the undistributed earnings of the Company’s foreign subsidiaries excluding Japan. Deferred income taxes have not been recorded for Japan, as any federal, state, or foreign withholding taxes associated with the repatriation of those earnings would be immaterial. The domestic and foreign components of the Company’s income before provision for income taxes are as follows: Year Ended December 31, 2021 2020 2019 Domestic* $ 1,431,797 $ 1,374,402 $ 1,196,883 Foreign* 369,622 251,755 219,079 Income before provision for income taxes $ 1,801,419 $ 1,626,157 $ 1,415,962 *After intercompany royalties, management fees and interest charges from the Company’s domestic to foreign entities of $61.1 million, $54.2 million and $51.2 million for the years ended December 31, 2021, 2020 and 2019, respectively. Components of the provision for income taxes are as follows: Year Ended December 31, 2021 2020 2019 Current: Federal $ 273,115 $ 259,073 $ 212,068 State 44,990 43,704 39,982 Foreign 89,410 70,658 55,167 407,515 373,435 307,217 Deferred: Federal 14,750 11,401 8,320 State 4,689 4,709 (6,878) Foreign 5,092 (167,595) (4,219) 24,531 (151,485) (2,777) Valuation allowance (8,102) (5,387) 3,687 $ 423,944 $ 216,563 $ 308,127 A reconciliation of the total provision for income taxes after applying the U.S. federal statutory rate of 21% to income before provision for income taxes to the reported provision for income taxes are as follows for the years ended: Year Ended December 31, 2021 2020 2019 U.S. Federal tax expense at statutory rates $ 378,298 $ 341,493 $ 297,352 State income taxes, net of federal tax benefit 38,894 37,478 30,098 Permanent differences (4,168) (1,064) (2,128) Stock based compensation 2,790 1,097 (13,473) Intra-company transfer benefit — (165,075) — Other (649) (7,388) (12,423) Foreign rate differential 16,881 15,409 5,014 Valuation allowance (8,102) (5,387) 3,687 $ 423,944 $ 216,563 $ 308,127 Major components of the Company’s deferred tax assets (liabilities) at December 31, 2021 and 2020 are as follows: 2021 2020 Deferred Tax Assets: Reserve for sales returns $ 889 $ 275 Reserve for inventory obsolescence 3,643 2,366 Reserve for marketing development fund 8,951 9,629 Capitalization of inventory costs 2,533 3,365 State franchise tax - current 2,493 4,229 Accrued compensation 2,854 1,284 Accrued other liabilities 4,634 7,464 Deferred revenue 68,557 75,592 Stock-based compensation 24,635 23,370 Foreign net operating loss carryforward 14,507 21,626 Prepaid supplies 6,317 5,551 Termination payments 58,042 63,009 Operating lease liabilities 4,711 4,434 Intangibles 72,666 87,687 Impairment-trademarks and others 2,047 2,055 Other deferred tax assets 33,013 27,164 Total gross deferred tax assets $ 310,492 $ 339,100 Deferred Tax Liabilities: Amortization of trademarks $ (41,517) $ (42,161) State franchise tax - deferred (5,505) (6,318) Operating lease ROU assets (4,711) (4,434) Other deferred tax liabilities (618) (58) Depreciation (5,907) (9,363) Total gross deferred tax liabilities (58,258) (62,334) Valuation Allowance (27,013) (35,116) Net deferred tax assets $ 225,221 $ 241,650 During the years ended December 31, 2021, 2020 and 2019, the Company established full valuation allowances against certain deferred tax assets, resulting from cumulative net operating losses incurred by certain foreign subsidiaries of the Company. The effect of the valuation allowances and the subsequent related impact on the Company’s overall tax rate was to decrease the Company’s provision for income taxes by $8.1 million and $5.4 million for the years ended December 31, 2021 and 2020, respectively, and increase the Company’s provision for income taxes $3.7 million for the year ended December 31, 2019. At December 31, 2021, the Company had net operating loss carryforwards of approximately $60.5 million. Of this amount, $35.2 million may be carried forward indefinitely. The remaining $25.3 million of net operating loss carryforwards will begin to expire in 2022. In October 2020, the Company completed an intra-entity transfer of intangible assets between certain of the Company’s foreign subsidiaries to better align its international structure with its expanding operations. The transfer resulted in a step-up of the tax-deductible basis in the transferred assets in a foreign jurisdiction, and created a temporary difference between the tax basis and book basis for such intangible assets. The Company recognized deferred tax assets of approximately $165.1 million, with a corresponding reduction to the provision for income taxes during the fourth quarter of 2020 in its consolidated financial statements. The tax deductions for the amortization of the deferred tax assets will be recognized in the future and any amortization not deducted for tax purposes will be carried forward indefinitely. The tax impact on the foreign subsidiary transferor was not material. The following is a roll-forward of the Company’s total gross unrecognized tax benefits, not including interest and penalties, for the years ended December 31, 2021, 2020 and 2019: Gross Unrecognized Tax Benefits Balance at December 31, 2018 $ 5,035 Additions for tax positions related to the current year — Additions for tax positions related to the prior year 1,833 Decreases for tax positions related to prior years (3,875) Balance at December 31, 2019 $ 2,993 Additions for tax positions related to the current year — Additions for tax positions related to the prior year — Decreases for tax positions related to prior years (2,251) Balance at December 31, 2020 $ 742 Additions for tax positions related to the current year — Additions for tax positions related to the prior year — Decreases for tax positions related to prior years (742) Balance at December 31, 2021 $ — The Company recognizes accrued interest and penalties related to unrecognized tax benefits in the provision for income taxes in the Company’s consolidated financial statements. As of December 31, 2021, the Company had no unrecognized tax benefits. It is expected that any change in the amount of unrecognized tax benefit change within the next 12 months will not be significant. The Company is subject to U.S. federal income tax as well as to income tax in multiple state and foreign jurisdictions. The Company is in various stages of examination with certain states and certain foreign jurisdictions, including the United Kingdom and Ireland. The Company’s 2018 through 2020 U.S. federal income tax returns are subject to examination by the IRS. The Company’s state income tax returns are subject to examination for the 2017 through 2020 tax years. |
EARNINGS PER SHARE
EARNINGS PER SHARE | 12 Months Ended |
Dec. 31, 2021 | |
EARNINGS PER SHARE | |
EARNINGS PER SHARE | 17. EARNINGS PER SHARE A reconciliation of the weighted average shares used in the basic and diluted earnings per common share computations for the years ended December 31, 2021, 2020 and 2019 is presented below (in thousands): 2021 2020 2019 Weighted-average shares outstanding: Basic 528,763 529,639 542,191 Dilutive securities 6,876 5,168 4,417 Diluted 535,639 534,807 546,608 For the years ended December 31, 2021, 2020 and 2019, options and awards outstanding totaling 0.8 million shares, 1.8 million shares and 4.4 million shares, respectively, were excluded from the calculations as their effect would have been antidilutive. |
EMPLOYEE BENEFIT PLAN
EMPLOYEE BENEFIT PLAN | 12 Months Ended |
Dec. 31, 2021 | |
EMPLOYEE BENEFIT PLAN | |
EMPLOYEE BENEFIT PLAN | 18. EMPLOYEE BENEFIT PLAN Employees of the Company may participate in the Monster Beverage Corporation 401(k) Plan, a defined contribution plan, which qualifies under Section 401(k) of the Internal Revenue Code. Participating employees may contribute into a traditional plan with pretax salary or into a Roth plan with after tax salary up to statutory limits. The Company contributes 50% of the employee contribution, up to 8% of each employee’s earnings, which vest over four years (2 years of service = 50%, 3 years of service = 75%, 4 years of service = 100%). Matching contributions were $5.5 million, $4.7 million and $3.4 million for the years ended December 31, 2021, 2020 and 2019, respectively. |
SEGMENT INFORMATION
SEGMENT INFORMATION | 12 Months Ended |
Dec. 31, 2021 | |
SEGMENT INFORMATION | |
SEGMENT INFORMATION | 19. SEGMENT INFORMATION The Company has three operating and reportable The Company’s Monster Energy® Drinks segment primarily generates net operating revenues by selling ready-to-drink packaged drinks primarily to bottlers/distributors. In some cases, the Company sells ready-to-drink packaged drinks directly to retail grocery and specialty chains, wholesalers, club stores, mass merchandisers, convenience chains, drug stores, foodservice customers, value stores, e-commerce retailers and the military. The Company’s Strategic Brands segment primarily generates net operating revenues by selling “concentrates” and/or “beverage bases” to authorized bottling and canning operations. Such bottlers generally combine the concentrates and/or beverage bases with sweeteners, water and other ingredients to produce ready-to-drink packaged energy drinks. The ready-to-drink packaged energy drinks are then sold by such bottlers to other bottlers/distributors and to retail grocery and specialty chains, wholesalers, club stores, mass merchandisers, convenience chains, foodservice customers, drug stores, value stores, e-commerce retailers and the military. To a lesser extent, the Strategic Brands segment generates net operating revenues by selling certain ready-to-drink packaged energy drinks to bottlers/distributors. Generally, the Monster Energy® Drinks segment generates higher per case net operating revenues, but lower per case gross profit margin percentages than the Strategic Brands segment. Corporate and unallocated amounts that do not relate to a reportable segment have been allocated to “Corporate & Unallocated.” No asset information, other than goodwill and other intangible assets, has been provided in the Company’s reportable segments, as management does not measure or allocate such assets on a segment basis. The net revenues derived from the Company’s reportable segments and other financial information related thereto for the years ended December 31 are as follows: 2021 2020 2019 Net sales: Monster Energy® Drinks⁽¹⁾ $ 5,220,673 $ 4,305,246 $ 3,904,029 Strategic Brands 294,762 266,354 274,925 Other 25,917 27,038 21,865 Corporate and unallocated — — — $ 5,541,352 $ 4,598,638 $ 4,200,819 2021 2020 2019 Operating Income: Monster Energy® Drinks⁽¹⁾ $ 1,990,785 $ 1,820,346 $ 1,565,977 Strategic Brands 173,660 155,047 164,053 Other 6,935 5,930 3,650 Corporate and unallocated (373,913) (348,170) (330,741) $ 1,797,467 $ 1,633,153 $ 1,402,939 2021 2020 2019 Income before tax: Monster Energy® Drinks⁽¹⁾ $ 1,992,185 $ 1,820,625 $ 1,567,022 Strategic Brands 173,739 155,047 164,049 Other 6,935 5,933 3,655 Corporate and unallocated (371,440) (355,448) (318,764) $ 1,801,419 $ 1,626,157 $ 1,415,962 (1) Includes $41.5 million, $42.1 million and $46.3 million for the years ended December 31, 2021, 2020 and 2019, respectively, related to the recognition of deferred revenue. 2021 2020 2019 Depreciation and amortization: Monster Energy® Drinks $ 34,532 $ 38,277 $ 39,397 Strategic Brands 1,085 4,178 7,935 Other 4,485 4,631 4,637 Corporate and unallocated 10,053 9,944 8,758 $ 50,155 $ 57,030 $ 60,727 Corporate and unallocated expenses were $373.9 million for the year ended December 31, 2021 and included $258.6 million of payroll costs, of which $70.3 million was attributable to stock-based compensation expense (See Note 15, “Stock-Based Compensation”), $77.9 million of professional service expenses, including accounting and legal costs, $9.3 million of insurance costs and $28.1 million of other operating expenses. Corporate and unallocated expenses were $348.2 million for the year ended December 31, 2020 and included $234.1 million of payroll costs, of which $69.9 million was attributable to stock-based compensation expense (See Note 15, “Stock-Based Compensation”), $67.6 million of professional service expenses, including accounting and legal costs, $7.5 million of insurance costs and $39.0 million of other operating expenses. Corporate and unallocated expenses were $330.7 million for the year ended December 31, 2019 and included $203.3 million of payroll costs, of which $63.4 million was attributable to stock-based compensation expense (See Note 15, “Stock-Based Compensation”), $78.5 million of professional service expenses, including accounting and legal costs, $6.1 million of insurance costs and $42.8 million of other operating expenses. Coca-Cola Consolidated, Inc. accounted for approximately 12%, 12% and 13% of the Company’s net sales for the years ended December 31, 2021, 2020 and 2019, respectively. Reyes Coca-Cola Bottling, LLC accounted for approximately 10%, 11% and 11% of the Company’s net sales for the years ended December 31, 2021, 2020 and 2019, respectively. Coca-Cola Europacific Partners accounted for approximately 12%, 10% and 10% of the Company’s net sales for the years ended December 31, 2021, 2020 and 2019, respectively. Net sales to customers outside the United States amounted to $2.04 billion, $1.51 billion and $1.33 billion for the years ended December 31, 2021, 2020 and 2019, respectively. Such sales were approximately 37%, 33% and 32% of net sales for the years ended December 31, 2021, 2020 and 2019, respectively. Goodwill and other intangible assets for the Company’s reportable segments as of December 31, 2021 and 2020 are as follows: 2021 2020 Goodwill and other intangible assets: Monster Energy® Drinks $ 1,420,503 $ 1,406,646 Strategic Brands 978,032 974,132 Other 5,494 9,911 Corporate and unallocated — — $ 2,404,029 $ 2,390,689 |
RELATED PARTY TRANSACTIONS
RELATED PARTY TRANSACTIONS | 12 Months Ended |
Dec. 31, 2021 | |
RELATED PARTY TRANSACTIONS | |
RELATED PARTY TRANSACTIONS | 20. RELATED PARTY TRANSACTIONS TCCC controls approximately 19.3% of the voting interests of the Company. The TCCC Subsidiaries, the TCCC Related Parties and certain TCCC independent bottlers, purchase and distribute the Company’s products in domestic and certain international markets. The Company also pays TCCC a commission based on certain sales within the TCCC distribution network. TCCC commissions, based on sales to the TCCC Subsidiaries and the TCCC Related Parties, for the year ended December 31, 2021 were $77.5 million, and are included as a reduction to net sales. TCCC commissions, based on sales to the TCCC Independent Bottlers for the year ended December 31, 2021 were $28.7 million, and are included in operating expenses in the consolidated statements of income. TCCC commissions, based on sales to the TCCC Subsidiaries and the TCCC Related Parties, for the year ended December 31, 2020 were $56.5 million, and are included as a reduction to net sales. TCCC commissions, based on sales to the TCCC Independent Bottlers for the year ended December 31, 2020 were $21.4 million, and are included in operating expenses in the consolidated statements of income. TCCC commissions, based on sales to the TCCC Subsidiaries and the TCCC Related Parties, for the year ended December 31, 2019 were $50.1 million, and are included as a reduction to net sales. TCCC commissions, based on sales to the TCCC Independent Bottlers for the year ended December 31, 2019 were $17.7 million, and are included in operating expenses in the consolidated statements of income. Net sales to the TCCC Subsidiaries for the years ended December 31, 2021, 2020 and 2019 were $120.4 million, $83.3 million and $79.5 million, respectively. The Company also purchases concentrates from TCCC which are then sold to certain of the Company’s bottlers/distributors. Concentrate purchases from TCCC were $27.2 million, $23.9 million and $25.4 million for the years ended December 31, 2021, 2020 and 2019, respectively. Certain TCCC Subsidiaries also contract manufacture certain of the Company’s energy drinks. Such contract manufacturing expenses were $31.5 million, $17.2 million and $17.1 million for the years ended December 31, 2021, 2020 and 2019, respectively. Accounts receivable, accounts payable and accrued promotional allowances related to the TCCC Subsidiaries are as follows at: December 31, December 31, 2021 2020 Accounts receivable, net $ 94,647 $ 44,925 Accounts payable $ (35,248) $ (30,792) Accrued promotional allowances $ (4,536) $ (5,834) Accrued liabilities $ (26,616) $ (15,446) In 2021, TCCC exercised its contract rights and began an examination in accordance with those rights for the years ended December 31, 2015 through December 31,2020. One director of the Company through certain trusts, and a family member of one director are principal owners of a company that provides promotional materials to the Company. Expenses incurred with such company in connection with promotional materials purchased during the years ended December 31, 2021, 2020 and 2019 were $3.6 million, $2.1 million and $1.5 million, respectively. In December 2018, the Company and a director of the Company entered into a 50-50 partnership that purchased land, and real property thereon, in Kona, Hawaii for the purpose of producing coffee products. The Company’s initial 50% contribution of $1.9 million was accounted for as an equity investment. During the year ended December 31, 2021, the Company recorded an equity loss of $0.2 million. As of December 31, 2021, the Company’s equity investment is $1.4 million and is included in other assets (non-current) in the accompanying consolidated balance sheet at December 31, 2021. |
SUBSEQUENT EVENTS
SUBSEQUENT EVENTS | 12 Months Ended |
Dec. 31, 2021 | |
SUBSEQUENT EVENTS | |
SUBSEQUENT EVENTS | 21. SUBSEQUENT EVENTS On February 17, 2022, the Company completed its acquisition of CANarchy Craft Brewery Collective LLC (“CANarchy”), a craft beer and hard seltzer company, for $330.0 million in cash, subject to adjustments. The transaction allows us to enter the alcohol beverage sector and brings the Cigar City family of brands including Jai Alai IPA and Florida Man IPA, the Oskar Blues family of brands including Dale’s Pale Ale and Wild Basin Hard Seltzers, the Deep Ellum family of brands including Dallas Blonde and Deep Ellum IPA, the Perrin Brewing family of brands including Black Ale, the Squatters family of brands including Hop Rising Double IPA and Juicy IPA and the Wasatch family of brands including Apricot Hefeweizen to our beverage portfolio. The transaction does not include CANarchy’s stand-alone restaurants. The Company’s organizational structure for its existing energy beverage business will remain unchanged. CANarchy will function independently, retaining its own organizational structure and team. |
SCHEDULE II - VALUATION AND QUA
SCHEDULE II - VALUATION AND QUALIFYING ACCOUNTS | 12 Months Ended |
Dec. 31, 2021 | |
SCHEDULE II - VALUATION AND QUALIFYING ACCOUNTS | |
SCHEDULE II - VALUATION AND QUALIFYING ACCOUNTS | Balance at Charged to Balance at beginning cost and end of Description of period expenses Deductions period Allowance for doubtful accounts, sales returns and cash discounts: 2021 $ 1,878 $ 14,799 $ (12,001) $ 4,676 2020 $ 2,045 $ 9,664 $ (9,831) $ 1,878 2019 $ 1,589 $ 9,583 $ (9,127) $ 2,045 Allowance on Deferred Tax Assets and Unrecognized Tax Benefits: 2021 $ 35,993 $ (8,980) $ — $ 27,013 2020 $ 43,853 $ (7,860) $ — $ 35,993 2019 $ 42,748 $ 1,105 $ — $ 43,853 |
ORGANIZATION AND SUMMARY OF S_2
ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 12 Months Ended |
Dec. 31, 2021 | |
ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |
Basis of Presentation | Basis of Presentation |
Principles of Consolidation | Principles of Consolidation |
Business Combinations | Business Combinations |
Cash and Cash Equivalents | Cash and Cash Equivalents |
Investments | Investments |
Accounts Receivable | Accounts Receivable – |
Inventories | Inventories |
Property and Equipment | Property and Equipment three |
Goodwill | Goodwill |
Other Intangibles | Other Intangibles |
Leases | The Company leases identified assets comprising real estate and equipment. Real estate leases consist primarily of office and warehouse space and equipment leases consist of vehicles and warehouse equipment. At the inception of a contract, the Company assesses whether the contract is, or contains, a lease. The Company’s assessment is based on: (1) whether the contract involves the use of a distinct identified asset, (2) whether the Company obtains the right to substantially all the economic benefit from the use of the asset throughout the term, and (3) whether the Company has the right to direct the use of the asset. At inception of a lease, the Company allocates the consideration in the contract to each lease and non-lease component based on the component’s relative stand-alone price to determine the lease payments. Lease and non-lease components are accounted for separately. Leases are classified as either finance leases or operating leases based on criteria in ASC 842, “Leases”. The Company’s operating leases are comprised of real estate and warehouse equipment, and the Company’s finance leases are comprised of vehicles. Right-of-use (“ROU”) assets and lease liabilities are recognized at the lease commencement date based on the present value of lease payments over the lease term. As the Company’s leases generally do not provide an implicit rate, the Company uses its incremental borrowing rate based on the estimated rate of interest for collateralized borrowing over a similar term of the lease payments at commencement date. ROU assets also include any lease payments made and exclude lease incentives. Lease terms include options to extend or terminate the lease when it is reasonably certain that the Company will exercise that option. Certain of the Company’s real estate leases contain variable lease payments, including payments based on an index or rate. Variable lease payments based on an index or rate are initially measured using the index or rate in effect at the lease commencement date. Additional payments based on the change in an index or rate, or payments based on a change in the Company’s portion of real estate taxes and insurance, are recorded as a period expense when incurred. Lease expense for operating leases, consisting of lease payments, is recognized on a straight-line basis over the lease term and is included in operating expenses in the consolidated statement of income. Lease expense for finance leases consists of the amortization of the ROU asset on a straight-line basis over the asset’s estimated useful life and is included in operating expenses in the consolidated statement of income. Interest expense on finance leases is calculated using the amortized cost basis and is included in other income (expense), net in the consolidated statement of income. The Company’s leases have remaining lease terms of less than one year to 12 years, some of which include options extend options terminate |
Long-Lived Assets | Long-Lived Assets |
Foreign Currency Translation and Transactions | Foreign Currency Translation and Transactions The Company has not designated its foreign currency exchange contracts as hedge transactions under FASB ASC 815. Therefore, gains and losses on the Company’s foreign currency exchange contracts are recognized in other income, net, in the consolidated statements of income, and are largely offset by the changes in the fair value of the underlying economically hedged item. For the years ended December 31, 2021, 2020 and 2019, aggregate foreign currency transaction gains (losses), including the gains or losses on forward currency exchange contracts, amounted to $0.3 million, ($11.2) million and ($4.1) million, respectively, and have been recorded in other income, net, in the accompanying consolidated statements of income. |
Revenue Recognition | The Company’s Monster Energy® Drinks segment generates net operating revenues by selling ready-to-drink packaged energy drinks primarily to bottlers and full service beverage bottlers/distributors (“bottlers/distributors”). In some cases, the Company sells ready-to-drink packaged energy drinks directly to retail grocery and specialty chains, wholesalers, club stores, mass merchandisers, convenience chains, drug stores, foodservice customers, value stores, e-commerce retailers and the military. The Company’s Strategic Brands segment primarily generates net operating revenues by selling “concentrates” and/or “beverage bases” to authorized bottling and canning operations. Such bottlers generally combine the concentrates and/or beverage bases with sweeteners, water and other ingredients to produce ready-to-drink packaged energy drinks. The ready-to-drink packaged energy drinks are then sold by such bottlers to other bottlers/distributors and to retail grocery and specialty chains, wholesalers, club stores, mass merchandisers, convenience chains, foodservice customers, drug stores, value stores, e-commerce retailers and the military. To a lesser extent, the Strategic Brands segment generates net operating revenues by selling certain ready-to-drink packaged energy drinks to bottlers/distributors. The majority of the Company’s revenue is recognized when it satisfies a single performance obligation by transferring control of its products to a customer. Control is generally transferred when the Company’s products are either shipped or delivered based on the terms contained within the underlying contracts or agreements. Certain of the Company’s bottlers/distributors may also perform a separate function as a co-packer on the Company’s behalf. In such cases, control of the Company’s products passes to such bottlers/distributors when they notify the Company that they have taken possession or transferred the relevant portion of the Company’s finished goods. The Company’s general payment terms are short-term in duration. The Company does not have significant financing components or payment terms. The Company did not have any material unsatisfied performance obligations as of December 31, 2021 and December 31, 2020. The Company excludes from revenues all taxes assessed by a governmental authority that are imposed on the sale of its products and collected from customers. Distribution expenses to transport the Company’s products, where applicable, and warehousing expense after manufacture are accounted for within operating expenses in the consolidated statements of income. Promotional and other allowances (variable consideration) recorded as a reduction to net sales, primarily include consideration given to the Company’s bottlers/distributors or retail customers including, but not limited to the following: ● discounts granted off list prices to support price promotions to end-consumers by retailers; ● reimbursements given to the Company’s bottlers/distributors for agreed portions of their promotional spend with retailers, including slotting, shelf space allowances and other fees for both new and existing products; ● the Company’s agreed share of fees given to bottlers/distributors and/or directly to retailers for advertising, in-store marketing and promotional activities; ● the Company’s agreed share of slotting, shelf space allowances and other fees given directly to retailers, club stores and/or wholesalers; ● incentives given to the Company’s bottlers/distributors and/or retailers for achieving or exceeding certain predetermined sales goals; ● discounted or free products; ● contractual fees given to the Company’s bottlers/distributors related to sales made directly by the Company to certain customers that fall within the bottlers’/distributors’ sales territories; and ● commissions to TCCC based on the Company’s sales to wholly-owned subsidiaries of TCCC (the “TCCC Subsidiaries”) and/or to TCCC bottlers/distributors accounted for under the equity method by TCCC (the “TCCC Related Parties”). The Company’s promotional allowance programs with its bottlers/distributors and/or retailers are executed through separate agreements in the ordinary course of business. These agreements generally provide for one or more of the arrangements described above and are of varying durations, typically ranging from one week to one year. The Company’s promotional and other allowances are calculated based on various programs with bottlers/distributors and retail customers, and accruals are established at the time of initial product sale for the Company’s anticipated liabilities. These accruals are based on agreed upon terms as well as the Company’s historical experience with similar programs and require management’s judgment with respect to estimating consumer participation and/or bottler/distributor and retail customer performance levels. Differences between such estimated expenses and actual expenses for promotional and other allowance costs have historically been insignificant and are recognized in earnings in the period such differences are determined. Amounts received pursuant to new and/or amended distribution agreements entered into with certain bottlers/distributors relating to the costs associated with terminating the Company’s prior distributors, are accounted for as deferred revenue and recognized as revenue ratably over the anticipated life of the respective distribution agreements, generally over 20 years. The Company also sells and/or enters into license agreements that generate revenues associated with third-party sales of non-beverage products bearing the Company’s trademarks including, but not limited to, clothing, backpacks, hats, t-shirts, jackets, helmets and automotive wheels. Management believes that adequate provision has been made for cash discounts, returns and spoilage based on the Company’s historical experience. |
Cost of Sales | Cost of Sales |
Operating Expenses | Operating Expenses |
Freight-Out Costs | Freight-Out Costs |
Advertising and Promotional Expenses | Advertising and Promotional Expenses |
Income Taxes | Income Taxes The Company assesses its income tax positions and records tax benefits for all years subject to examination based upon the Company’s evaluation of the facts, circumstances and information available at the reporting date. For those tax positions where there is a greater than 50% likelihood that a tax benefit will be sustained, the Company has recorded the largest amount of tax benefit that may potentially be realized upon ultimate settlement with a taxing authority that has full knowledge of all relevant information. For those income tax positions where there is less than 50% likelihood that a tax benefit will be sustained, no tax benefit has been recognized in the financial statements. |
Stock-Based Compensation | Stock-Based Compensation |
Net Income Per Common Share | Net Income Per Common Share |
Concentration of Risk | Concentration of Risk – The Coca-Cola Company (“TCCC”), through certain wholly-owned subsidiaries (the “TCCC Subsidiaries”), accounted for approximately 2%of the Company’s net sales for the years ended December 31, 2021, 2020 and 2019. Coca-Cola Consolidated, Inc. accounted for approximately 12%, 12% and 13% of the Company’s net sales for the years ended December 31, 2021, 2020 and 2019, respectively. Reyes Coca-Cola Bottling, LLC accounted for approximately 10%, 11% and 11% of the Company’s net sales for the years ended December 31, 2021, 2020 and 2019, respectively. Coca-Cola Europacific Partners accounted for approximately 12%, 10% and 10% of the Company’s net sales for the years ended December 31, 2021, 2020 and 2019, respectively. |
Credit Risk | Credit Risk |
Fair Value of Financial Instruments | Fair Value of Financial Instruments |
Use of Estimates | Use of Estimates |
Recent Accounting Pronouncements | Recent Accounting Pronouncements – In October 2021, the FASB issued Accounting Standards Update (“ASU”) No. 2021-08, “Accounting for Contract Assets and Contract Liabilities from Contracts with Customers (Topic 805)”. ASU No. 2021-08 requires an acquirer in a business combination to recognize and measure contract assets and contract liabilities (deferred revenue) from acquired contracts using the revenue recognition guidance in Topic 606. At the acquisition date, the acquirer applies the revenue model as if it had originated the acquired contracts. The ASU is effective for annual periods beginning after December 15, 2022, including interim periods within those fiscal years. Adoption of the ASU should be applied prospectively. Early adoption is also permitted, including adoption in an interim period. If early adopted, the amendments are applied retrospectively to all business combinations for which the acquisition date occurred during the fiscal year of adoption. The Company is currently evaluating the impact of ASU No. 2021-08 on its financial position, results of operations and liquidity. |
REVENUE RECOGNITION (Tables)
REVENUE RECOGNITION (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
REVENUE RECOGNITION | |
Schedule of disaggregation of revenue by geographical markets | Year Ended December 31, 2021 Latin America U.S. and and Net Sales Canada EMEA 1 Asia Pacific Caribbean Total Monster Energy® Drinks $ 3,455,704 $ 1,004,005 $ 446,023 $ 314,941 $ 5,220,673 Strategic Brands 158,390 99,423 26,811 10,138 294,762 Other 25,917 — — — 25,917 Total Net Sales $ 3,640,011 $ 1,103,428 $ 472,834 $ 325,079 $ 5,541,352 Year Ended December 31, 2020 Latin America U.S. and and Net Sales Canada EMEA 1 Asia Pacific Caribbean Total Monster Energy® Drinks $ 3,020,667 $ 675,045 $ 400,317 $ 209,217 $ 4,305,246 Strategic Brands 166,861 70,782 23,475 5,236 266,354 Other 27,038 — — — 27,038 Total Net Sales $ 3,214,566 $ 745,827 $ 423,792 $ 214,453 $ 4,598,638 Year Ended December 31, 2019 Latin America U.S. and and Net Sales Canada EMEA 1 Asia Pacific Caribbean Total Monster Energy® $ 2,799,701 $ 599,706 $ 326,684 $ 177,938 $ 3,904,029 Strategic Brands 173,968 74,803 25,060 1,094 274,925 Other 21,865 — — — 21,865 Total Net Sales $ 2,995,534 $ 674,509 $ 351,744 $ 179,032 $ 4,200,819 1 Europe, Middle East and Africa (“EMEA”) |
LEASES (Tables)
LEASES (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
LEASES | |
Schedule of lease cost | 2021 2020 2019 Operating lease cost $ 4,614 $ 4,637 $ 4,899 Short-term lease cost 5,218 3,408 3,406 Variable lease cost 710 719 640 Finance leases: Amortization of ROU assets 546 626 436 Interest on lease liabilities 19 39 56 Finance lease cost 565 665 492 Total lease cost $ 11,107 $ 9,429 $ 9,437 |
Schedule of supplemental cash flow information for leases | 2021 2020 2019 Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows from operating leases $ 4,123 $ 3,982 $ 4,077 Operating cash flows from finance leases 19 39 56 Financing cash flows from finance leases 2,698 3,086 2,223 ROU assets obtained in exchange for lease obligations: Finance leases 2,878 2,417 2,866 Operating leases 4,313 3,003 34,931 |
Schedule of ROU assets for operating and finance leases | December 31, 2021 Real Estate Equipment Total Balance Sheet Location Operating leases $ 22,518 $ 639 $ 23,157 Other Assets Finance leases — 2,646 2,646 Property and Equipment, net December 31, 2020 Real Estate Equipment Total Balance Sheet Location Operating leases $ 22,565 $ 189 $ 22,754 Other Assets Finance leases — 2,120 2,120 Property and Equipment, net |
Summary of operating and finance lease liabilities recognized in the condensed consolidated balance sheets | December 31, 2021 Operating Leases Finance Leases Accrued liabilities $ 3,990 $ 960 Other liabilities 17,389 41 Total $ 21,379 $ 1,001 December 31, 2020 Operating Leases Finance Leases Accrued liabilities $ 3,171 $ 799 Other liabilities 17,342 24 Total $ 20,513 $ 823 |
Schedule of weighted-average remaining lease term and weighted-average discount rate | December 31, 2021 Operating Leases Finance Leases Weighted-average remaining lease term (years) 8.1 0.7 Weighted-average discount rate 3.5 % 1.3 % December 31, 2020 Operating Leases Finance Leases Weighted-average remaining lease term (years) 9.4 0.6 Weighted-average discount rate 3.6 % 1.9 % |
Schedule of reconciliation of undiscounted future lease payments for operating leases | Undiscounted Future Lease Payments Operating Leases Finance Leases 2022 $ 4,605 $ 964 2023 3,821 21 2024 2,978 13 2025 1,669 8 2026 1,692 — 2027 and thereafter 9,949 — Total lease payments 24,714 1,006 Less imputed interest (3,335) (5) Total $ 21,379 $ 1,001 |
INVESTMENTS (Tables)
INVESTMENTS (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
INVESTMENTS | |
Summary of investments in available-for-sale | Continuous Continuous Gross Gross Unrealized Unrealized Unrealized Unrealized Loss Position Loss Position Amortized Holding Holding Fair less than 12 greater than 12 December 31, 2021 Cost Gains Losses Value Months Months Available-for-sale Short-term: Commercial paper $ 334,077 $ — $ — $ 334,077 $ — $ — Certificates of deposit 44,502 — — 44,502 — — Municipal securities 666 — — 666 — — U.S. government agency securities 62,687 — 26 62,661 26 — U.S. treasuries 1,308,536 2 717 1,307,821 717 — Long-term: U.S. government agency securities 12,500 — 24 12,476 24 — U.S. treasuries 87,133 — 190 86,943 190 — Total $ 1,850,101 $ 2 $ 957 $ 1,849,146 $ 957 $ — Continuous Continuous Gross Gross Unrealized Unrealized Unrealized Unrealized Loss Position Loss Position Amortized Holding Holding Fair less than 12 greater than 12 December 31, 2020 Cost Gains Losses Value Months Months Available-for-sale Short-term: Commercial paper $ 119,886 $ — $ — $ 119,886 $ — $ — Certificates of deposit 20,387 — — 20,387 — — Municipal securities 9,083 — — 9,083 — — U.S. government agency securities 81,521 13 3 81,531 3 — U.S. treasuries 650,386 150 69 650,467 69 — Long-term: U.S. government agency securities 10,350 1 — 10,351 — — U.S. treasuries 33,946 1 7 33,940 7 — Total $ 925,559 $ 165 $ 79 $ 925,645 $ 79 $ — |
Summary of the underlying contractual maturities of investments | The following table summarizes the underlying contractual maturities of the Company’s investments at: December 31, 2021 December 31, 2020 Amortized Cost Fair Value Amortized Cost Fair Value Less than 1 year: Commercial paper $ 334,077 $ 334,077 $ 119,886 $ 119,886 Municipal securities 666 666 9,083 9,083 U.S. government agency securities 62,687 62,661 81,521 81,531 Certificates of deposit 44,502 44,502 20,387 20,387 U.S. treasuries 1,308,536 1,307,821 650,386 650,467 Due 1 - 10 years: U.S. treasuries 87,133 86,943 33,946 33,940 U.S. government agency securities 12,500 12,476 10,350 10,351 Total $ 1,850,101 $ 1,849,146 $ 925,559 $ 925,645 |
FAIR VALUE OF CERTAIN FINANCI_2
FAIR VALUE OF CERTAIN FINANCIAL ASSETS AND LIABILITIES (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
FAIR VALUE OF CERTAIN FINANCIAL ASSETS AND LIABILITIES | |
Schedule of financial assets and liabilities recorded at fair value on a recurring basis | December 31, 2021 Level 1 Level 2 Level 3 Total Cash $ 749,089 $ — $ — $ 749,089 Money market funds 440,826 — — 440,826 Certificates of deposit — 44,502 — 44,502 Commercial paper — 335,477 — 335,477 Municipal securities — 2,428 — 2,428 U.S. government agency securities — 75,137 — 75,137 U.S. treasuries — 1,528,149 — 1,528,149 Foreign currency derivatives — (278) — (278) Total $ 1,189,915 $ 1,985,415 $ — $ 3,175,330 Amounts included in: Cash and cash equivalents $ 1,189,915 $ 136,547 $ — $ 1,326,462 Short-term investments — 1,749,727 — 1,749,727 Accounts receivable, net — 654 — 654 Investments — 99,419 — 99,419 Accrued liabilities — (932) — (932) Total $ 1,189,915 $ 1,985,415 $ — $ 3,175,330 December 31, 2020 Level 1 Level 2 Level 3 Total Cash $ 796,421 $ — $ — $ 796,421 Money market funds 352,730 — — 352,730 Certificates of deposit — 23,137 — 23,137 Commercial paper — 130,883 — 130,883 Municipal securities — 9,083 — 9,083 U.S. government agency securities — 91,882 — 91,882 U.S. treasuries — 701,922 — 701,922 Foreign currency derivatives — (2,578) — (2,578) Total $ 1,149,151 $ 954,329 $ — $ 2,103,480 Amounts included in: Cash and cash equivalents $ 1,149,151 $ 31,262 $ — $ 1,180,413 Short-term investments — 881,354 — 881,354 Accounts receivable, net — 69 — 69 Investments — 44,291 — 44,291 Accrued liabilities — (2,647) — (2,647) Total $ 1,149,151 $ 954,329 $ — $ 2,103,480 |
DERIVATIVE INSTRUMENTS AND HE_2
DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES | |
Schedule of notional amount and fair value of all outstanding foreign currency derivative instruments in the condensed consolidated balance sheets | December 31, 2021 Derivatives not designated as hedging instruments under Notional Fair FASB ASC 815-20 Amount Value Balance Sheet Location Assets: Foreign currency exchange contracts: Receive SGD/pay USD 16,544 297 Accounts receivable, net Receive USD/pay COP 9,754 296 Accounts receivable, net Receive RSD/pay USD 9,837 46 Accounts receivable, net Receive USD/pay RUB 7,175 15 Accounts receivable, net Liabilities: Foreign currency exchange contracts: Receive USD/pay GBP $ 29,929 $ (666) Accrued liabilities Receive USD/pay AUD 2,602 (88) Accrued liabilities Receive USD/pay CNY 12,230 (74) Accrued liabilities Receive USD/pay NZD 2,693 (45) Accrued liabilities Receive USD/pay EUR 3,045 (29) Accrued liabilities Receive USD/pay ZAR 4,140 (21) Accrued liabilities Receive USD/pay DKK 1,461 (9) Accrued liabilities December 31, 2020 Derivatives not designated as hedging instruments under Notional Fair FASB ASC 815-20 Amount Value Balance Sheet Location Assets: Foreign currency exchange contracts: Receive SGD/pay USD $ 18,713 $ 41 Accounts receivable, net Receive RSD/pay USD 10,127 28 Accounts receivable, net Liabilities: Foreign currency exchange contracts: Receive EUR/pay USD $ 1,298,899 $ (1,768) Accrued liabilities Receive USD/pay GBP 35,256 (416) Accrued liabilities Receive USD/pay AUD 8,508 (130) Accrued liabilities Receive USD/pay ZAR 2,403 (106) Accrued liabilities Receive USD/pay COP 5,436 (93) Accrued liabilities Receive USD/pay CNY 12,344 (50) Accrued liabilities Receive USD/pay RUB 7,780 (40) Accrued liabilities Receive NOK/pay USD 4,411 (18) Accrued liabilities Receive USD/pay NZD 2,290 (13) Accrued liabilities Receive SEK/pay USD 2,275 (10) Accrued liabilities Receive USD/pay DKK 3,151 (3) Accrued liabilities |
Schedule of net (losses) gains on derivative instruments in the condensed consolidated statements of income | Amount of gain (loss) recognized in income on derivatives Derivatives not designated as Location of gain (loss) Year ended hedging instruments under recognized in income on December 31, December 31, December 31, FASB ASC 815-20 derivatives 2021 2020 2019 Foreign currency exchange contracts Other income (expense), net $ (5,445) $ (3,317) $ (2,555) |
INVENTORIES (Tables)
INVENTORIES (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
INVENTORIES | |
Schedule of inventories | 2021 2020 Raw materials $ 349,865 $ 155,166 Finished goods 243,492 177,919 $ 593,357 $ 333,085 |
PROPERTY AND EQUIPMENT, Net (Ta
PROPERTY AND EQUIPMENT, Net (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
PROPERTY AND EQUIPMENT, Net | |
Schedule of property and equipment | 2021 2020 Land $ 85,455 $ 85,876 Leasehold improvements 11,845 11,524 Furniture and fixtures 8,274 8,271 Office and computer equipment 21,601 21,657 Computer software 8,383 6,945 Equipment 190,333 185,348 Buildings 167,243 156,616 Vehicles 45,404 43,173 538,538 519,410 Less: accumulated depreciation and amortization (224,785) (204,754) $ 313,753 $ 314,656 |
GOODWILL AND OTHER INTANGIBLE_2
GOODWILL AND OTHER INTANGIBLE ASSETS (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
GOODWILL AND OTHER INTANGIBLE ASSETS | |
Schedule of goodwill | Monster Energy® Strategic Drinks Brands Other Total Balance at December 31, 2020 $ 693,644 $ 637,999 $ — $ 1,331,643 Acquisitions — — — — Balance at December 31, 2021 $ 693,644 $ 637,999 $ — $ 1,331,643 Monster Energy® Strategic Drinks Brands Other Total Balance at December 31, 2019 $ 693,644 $ 637,999 $ — $ 1,331,643 Acquisitions — — — — Balance at December 31, 2020 $ 693,644 $ 637,999 $ — $ 1,331,643 |
Schedule of intangible assets | December 31, December 31, 2021 2020 Amortizing intangibles $ 66,872 $ 66,875 Accumulated amortization (61,227) (56,801) 5,645 10,074 Non-amortizing intangibles 1,066,741 1,048,972 $ 1,072,386 $ 1,059,046 |
Schedule of future estimated amortization expense related to amortizing intangibles | The following is the future estimated amortization expense related to amortizing intangibles as of December 31, 2021: Year Ending December 31: 2022 $ 4,405 2023 1,112 2024 14 2025 13 2026 13 2027 and thereafter 88 $ 5,645 |
COMMITMENTS AND CONTINGENCIES (
COMMITMENTS AND CONTINGENCIES (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
COMMITMENTS AND CONTINGENCIES | |
Schedule of contractual obligations related primarily to sponsorships and other commitments | Year Ending December 31: 2022 $ 236,698 2023 57,848 2024 10,497 2025 10 2026 — 2027 and thereafter — $ 305,053 |
ACCUMULATED OTHER COMPREHENSI_2
ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) | |
Schedule of components of accumulated other comprehensive (loss) income | 2021 2020 Accumulated net unrealized (loss) gain on available-for-sale securities $ (956) $ 84 Foreign currency translation adjustments, net of tax (68,209) 2,950 Total accumulated other comprehensive (loss) income $ (69,165) $ 3,034 |
STOCK-BASED COMPENSATION (Table
STOCK-BASED COMPENSATION (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
STOCK-BASED COMPENSATION | |
Schedule of weighted-average assumptions used to estimate the fair value of options granted | 2021 2020 2019 Dividend yield 0.0 % 0.0 % 0.0 % Expected volatility 28.9 % 30.4 % 30.2 % Risk-free interest rate 0.85 % 0.70 % 2.37 % Expected term 5.8 Years 5.8 Years 6.0 Years |
Summary of activities with respect to its stock option plans | Weighted- Weighted- Average Average Remaining Number of Exercise Contractual Aggregate Shares Price Per Term (in Intrinsic Options (in thousands) Share years) Value Outstanding at January 1, 2021 13,973 $ 44.93 5.7 $ 664,432 Granted 01/01/21 - 03/31/21 1,015 $ 88.95 Granted 04/01/21 - 06/30/21 13 $ 91.36 Granted 07/01/21 - 09/30/21 23 $ 95.33 Granted 10/01/21 - 12/31/21 12 $ 87.00 Exercised (1,037) $ 44.10 Cancelled or forfeited (139) $ 63.05 Outstanding at December 31, 2021 13,860 $ 48.19 5.1 $ 663,148 Vested and expected to vest in the future at December 31, 2021 13,633 $ 47.80 5.0 $ 657,633 Exercisable at December 31, 2021 9,644 $ 40.33 4.0 $ 537,261 |
Summary of information about stock options outstanding and exercisable | Options Outstanding Options Exercisable Weighted Average Remaining Weighted Number Weighted Number Contractual Average Exercisable Average Range of Exercise Outstanding Term Exercise (In Exercise Prices ($) (In Thousands) (Years) Price ($) Thousands) Price ($) $ 15.71 - $ 17.99 1,395 1.4 $ 17.77 1,395 $ 17.77 $ 18.64 - $ 23.35 1,562 2.1 $ 23.08 1,562 $ 23.08 $ 36.05 - $ 36.05 9 3.0 $ 36.05 9 $ 36.05 $ 37.10 - $ 43.99 2,280 4.3 $ 43.47 2,272 $ 43.47 $ 44.73 - $ 45.16 1,410 3.4 $ 45.10 1,410 $ 45.10 $ 45.55 - $ 54.45 1,491 5.5 $ 48.21 1,058 $ 47.43 $ 55.14 - $ 57.95 153 7.1 $ 56.90 36 $ 56.57 $ 58.73 - $ 58.73 2,054 6.2 $ 58.73 1,084 $ 58.73 $ 58.77 - $ 58.77 4 6.6 $ 58.77 2 $ 58.77 $ 59.67 - $ 97.80 3,502 8.1 $ 69.29 816 $ 60.56 13,860 5.1 $ 48.19 9,644 $ 40.33 |
Summary of activities with respect to non-vested restricted stock units | Weighted Number of Average Shares (in Grant-Date thousands) Fair Value Non-vested at January 1, 2021 947 $ 60.52 Granted 01/01/21 - 03/31/21 1 304 $ 86.28 Granted 04/01/21 - 06/30/21 14 $ 92.14 Granted 07/01/21 - 09/30/21 1 $ 89.84 Granted 10/01/21 - 12/31/21 1 $ 89.95 Vested (344) $ 62.29 Forfeited/cancelled (13) $ 60.41 Non-vested at December 31, 2021 910 $ 69.02 |
Schedule of employee and non-employee share-based compensation expense | 2021 2020 2019 Operating expenses $ 70,483 $ 70,289 $ 63,356 Total employee and non-employee share-based compensation expense included in income, before 70,483 70,289 63,356 Less: Amount of income tax benefit recognized in earnings (14,228) (15,499) (36,326) Amount charged against net income $ 56,255 $ 54,790 $ 27,030 |
INCOME TAXES (Tables)
INCOME TAXES (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
INCOME TAXES | |
Schedule of domestic and foreign components of the income before provision for income taxes | Year Ended December 31, 2021 2020 2019 Domestic* $ 1,431,797 $ 1,374,402 $ 1,196,883 Foreign* 369,622 251,755 219,079 Income before provision for income taxes $ 1,801,419 $ 1,626,157 $ 1,415,962 *After intercompany royalties, management fees and interest charges from the Company’s domestic to foreign entities of $61.1 million, $54.2 million and $51.2 million for the years ended December 31, 2021, 2020 and 2019, respectively. |
Components of the provision for income taxes | Year Ended December 31, 2021 2020 2019 Current: Federal $ 273,115 $ 259,073 $ 212,068 State 44,990 43,704 39,982 Foreign 89,410 70,658 55,167 407,515 373,435 307,217 Deferred: Federal 14,750 11,401 8,320 State 4,689 4,709 (6,878) Foreign 5,092 (167,595) (4,219) 24,531 (151,485) (2,777) Valuation allowance (8,102) (5,387) 3,687 $ 423,944 $ 216,563 $ 308,127 |
Schedule of reconciliation of income taxes computed at statutory federal rate to total income taxes | Year Ended December 31, 2021 2020 2019 U.S. Federal tax expense at statutory rates $ 378,298 $ 341,493 $ 297,352 State income taxes, net of federal tax benefit 38,894 37,478 30,098 Permanent differences (4,168) (1,064) (2,128) Stock based compensation 2,790 1,097 (13,473) Intra-company transfer benefit — (165,075) — Other (649) (7,388) (12,423) Foreign rate differential 16,881 15,409 5,014 Valuation allowance (8,102) (5,387) 3,687 $ 423,944 $ 216,563 $ 308,127 |
Components of the deferred tax assets (liabilities) | 2021 2020 Deferred Tax Assets: Reserve for sales returns $ 889 $ 275 Reserve for inventory obsolescence 3,643 2,366 Reserve for marketing development fund 8,951 9,629 Capitalization of inventory costs 2,533 3,365 State franchise tax - current 2,493 4,229 Accrued compensation 2,854 1,284 Accrued other liabilities 4,634 7,464 Deferred revenue 68,557 75,592 Stock-based compensation 24,635 23,370 Foreign net operating loss carryforward 14,507 21,626 Prepaid supplies 6,317 5,551 Termination payments 58,042 63,009 Operating lease liabilities 4,711 4,434 Intangibles 72,666 87,687 Impairment-trademarks and others 2,047 2,055 Other deferred tax assets 33,013 27,164 Total gross deferred tax assets $ 310,492 $ 339,100 Deferred Tax Liabilities: Amortization of trademarks $ (41,517) $ (42,161) State franchise tax - deferred (5,505) (6,318) Operating lease ROU assets (4,711) (4,434) Other deferred tax liabilities (618) (58) Depreciation (5,907) (9,363) Total gross deferred tax liabilities (58,258) (62,334) Valuation Allowance (27,013) (35,116) Net deferred tax assets $ 225,221 $ 241,650 |
Schedule of roll-forward of the total gross unrecognized tax benefits, not including interest and penalties | Gross Unrecognized Tax Benefits Balance at December 31, 2018 $ 5,035 Additions for tax positions related to the current year — Additions for tax positions related to the prior year 1,833 Decreases for tax positions related to prior years (3,875) Balance at December 31, 2019 $ 2,993 Additions for tax positions related to the current year — Additions for tax positions related to the prior year — Decreases for tax positions related to prior years (2,251) Balance at December 31, 2020 $ 742 Additions for tax positions related to the current year — Additions for tax positions related to the prior year — Decreases for tax positions related to prior years (742) Balance at December 31, 2021 $ — |
EARNINGS PER SHARE (Tables)
EARNINGS PER SHARE (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
EARNINGS PER SHARE | |
Schedule of reconciliation of the weighted average shares used in the basic and diluted earnings per common share computations | A reconciliation of the weighted average shares used in the basic and diluted earnings per common share computations for the years ended December 31, 2021, 2020 and 2019 is presented below (in thousands): 2021 2020 2019 Weighted-average shares outstanding: Basic 528,763 529,639 542,191 Dilutive securities 6,876 5,168 4,417 Diluted 535,639 534,807 546,608 |
SEGMENT INFORMATION (Tables)
SEGMENT INFORMATION (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
SEGMENT INFORMATION | |
Schedule of net revenues and other financial information by segment | 2021 2020 2019 Net sales: Monster Energy® Drinks⁽¹⁾ $ 5,220,673 $ 4,305,246 $ 3,904,029 Strategic Brands 294,762 266,354 274,925 Other 25,917 27,038 21,865 Corporate and unallocated — — — $ 5,541,352 $ 4,598,638 $ 4,200,819 2021 2020 2019 Operating Income: Monster Energy® Drinks⁽¹⁾ $ 1,990,785 $ 1,820,346 $ 1,565,977 Strategic Brands 173,660 155,047 164,053 Other 6,935 5,930 3,650 Corporate and unallocated (373,913) (348,170) (330,741) $ 1,797,467 $ 1,633,153 $ 1,402,939 2021 2020 2019 Income before tax: Monster Energy® Drinks⁽¹⁾ $ 1,992,185 $ 1,820,625 $ 1,567,022 Strategic Brands 173,739 155,047 164,049 Other 6,935 5,933 3,655 Corporate and unallocated (371,440) (355,448) (318,764) $ 1,801,419 $ 1,626,157 $ 1,415,962 (1) Includes $41.5 million, $42.1 million and $46.3 million for the years ended December 31, 2021, 2020 and 2019, respectively, related to the recognition of deferred revenue. 2021 2020 2019 Depreciation and amortization: Monster Energy® Drinks $ 34,532 $ 38,277 $ 39,397 Strategic Brands 1,085 4,178 7,935 Other 4,485 4,631 4,637 Corporate and unallocated 10,053 9,944 8,758 $ 50,155 $ 57,030 $ 60,727 |
Schedule of goodwill and other intangible assets for the reportable segments | 2021 2020 Goodwill and other intangible assets: Monster Energy® Drinks $ 1,420,503 $ 1,406,646 Strategic Brands 978,032 974,132 Other 5,494 9,911 Corporate and unallocated — — $ 2,404,029 $ 2,390,689 |
RELATED PARTY TRANSACTIONS (Tab
RELATED PARTY TRANSACTIONS (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
RELATED PARTY TRANSACTIONS | |
Schedule of related party transactions | December 31, December 31, 2021 2020 Accounts receivable, net $ 94,647 $ 44,925 Accounts payable $ (35,248) $ (30,792) Accrued promotional allowances $ (4,536) $ (5,834) Accrued liabilities $ (26,616) $ (15,446) |
ORGANIZATION AND SUMMARY OF S_3
ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Property and Equipment (Details) - Property and Equipment | 12 Months Ended |
Dec. 31, 2021 | |
Minimum | |
Property and equipment, net | |
Estimated useful lives (in years) | 3 years |
Maximum | |
Property and equipment, net | |
Estimated useful lives (in years) | 30 years |
ORGANIZATION AND SUMMARY OF S_4
ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Goodwill (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |||
Impairment of Goodwill | $ 0 | $ 0 | $ 0 |
ORGANIZATION AND SUMMARY OF S_5
ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Other Intangibles (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |||
Loss on impairment of intangibles | $ 0 | $ 8,700 | $ 0 |
ORGANIZATION AND SUMMARY OF S_6
ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Foreign Currency Translation and Transactions (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |||
Foreign currency transaction losses | $ (0.3) | $ 11.2 | $ 4.1 |
ORGANIZATION AND SUMMARY OF S_7
ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Freight-Out Costs (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |||
Freight-out costs | $ 213.9 | $ 134.1 | $ 122.5 |
ORGANIZATION AND SUMMARY OF S_8
ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Advertising and Promotional Expenses (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |||
Advertising and promotional expenses | $ 417.6 | $ 345.7 | $ 391.6 |
ORGANIZATION AND SUMMARY OF S_9
ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Concentration of Risk (Details) - Customer concentration - Sales | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
TCCC | |||
Concentration of risk | |||
Percentage of net sales | 2.00% | 2.00% | 2.00% |
Coca-Cola Consolidated, Inc | |||
Concentration of risk | |||
Percentage of net sales | 12.00% | 12.00% | 13.00% |
Reyes Coca-Cola Bottling | |||
Concentration of risk | |||
Percentage of net sales | 10.00% | 11.00% | 11.00% |
Coca-Cola European Partners | |||
Concentration of risk | |||
Percentage of net sales | 12.00% | 10.00% | 10.00% |
REVENUE RECOGNITION - (Details)
REVENUE RECOGNITION - (Details) | 12 Months Ended |
Dec. 31, 2021segment | |
REVENUE RECOGNITION | |
Number of operating segments | 3 |
Number of reportable segments | 3 |
Distribution agreement, revenue recognition period | 20 years |
REVENUE RECOGNITION - Disaggreg
REVENUE RECOGNITION - Disaggregation of Revenue (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Total Net Sales | $ 5,541,352 | $ 4,598,638 | $ 4,200,819 |
Contract Liabilities | |||
Deferred revenue | 285,800 | 309,900 | |
Deferred revenue recognized in net sales | 41,500 | 42,100 | 46,300 |
U.S. and Canada | |||
Total Net Sales | 3,640,011 | 3,214,566 | 2,995,534 |
EMEA | |||
Total Net Sales | 1,103,428 | 745,827 | 674,509 |
Asia Pacific | |||
Total Net Sales | 472,834 | 423,792 | 351,744 |
Latin America and Caribbean | |||
Total Net Sales | 325,079 | 214,453 | 179,032 |
Monster Energy Drinks | |||
Total Net Sales | 5,220,673 | 4,305,246 | 3,904,029 |
Monster Energy Drinks | U.S. and Canada | |||
Total Net Sales | 3,455,704 | 3,020,667 | 2,799,701 |
Monster Energy Drinks | EMEA | |||
Total Net Sales | 1,004,005 | 675,045 | 599,706 |
Monster Energy Drinks | Asia Pacific | |||
Total Net Sales | 446,023 | 400,317 | 326,684 |
Monster Energy Drinks | Latin America and Caribbean | |||
Total Net Sales | 314,941 | 209,217 | 177,938 |
Strategic Brands | |||
Total Net Sales | 294,762 | 266,354 | 274,925 |
Strategic Brands | U.S. and Canada | |||
Total Net Sales | 158,390 | 166,861 | 173,968 |
Strategic Brands | EMEA | |||
Total Net Sales | 99,423 | 70,782 | 74,803 |
Strategic Brands | Asia Pacific | |||
Total Net Sales | 26,811 | 23,475 | 25,060 |
Strategic Brands | Latin America and Caribbean | |||
Total Net Sales | 10,138 | 5,236 | 1,094 |
Other | |||
Total Net Sales | 25,917 | 27,038 | 21,865 |
Other | U.S. and Canada | |||
Total Net Sales | $ 25,917 | $ 27,038 | $ 21,865 |
LEASES - Lease Terms (Details)
LEASES - Lease Terms (Details) | 12 Months Ended |
Dec. 31, 2021 | |
LEASES | |
Operating leases, options to extend | true |
Finance leases, options to extend | true |
Operating leases, options to terminate | true |
Finance leases, options to terminate | true |
Minimum | |
LEASES | |
Operating leases, lease term (in years) | 1 year |
Maximum | |
LEASES | |
Operating leases, lease term (in years) | 12 years |
Operating leases, renewal lease term (in years) | 5 years |
Operating leases, termination period (in years) | 1 year |
LEASES - Lease Cost (Details)
LEASES - Lease Cost (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
LEASES | |||
Operating lease cost | $ 4,614 | $ 4,637 | $ 4,899 |
Short-term lease cost | 5,218 | 3,408 | 3,406 |
Variable lease cost | 710 | 719 | 640 |
Finance leases: | |||
Amortization of ROU assets | 546 | 626 | 436 |
Interest on lease liabilities | 19 | 39 | 56 |
Finance lease cost | 565 | 665 | 492 |
Total lease cost | $ 11,107 | $ 9,429 | $ 9,437 |
LEASES - Supplemental cash flow
LEASES - Supplemental cash flow information (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Cash paid for amounts included in the measurement of lease liabilities: | |||
Operating cash outflows from operating leases | $ 4,123 | $ 3,982 | $ 4,077 |
Operating cash outflows from finance leases | 19 | 39 | 56 |
Financing cash outflows from finance leases | 2,698 | 3,086 | 2,223 |
ROU assets obtained in exchange for lease obligations: | |||
Finance leases | 2,878 | 2,417 | 2,866 |
Operating leases | $ 4,313 | $ 3,003 | $ 34,931 |
LEASES - ROU assets for operati
LEASES - ROU assets for operating and finance leases (Details) - USD ($) $ in Thousands | Dec. 31, 2021 | Dec. 31, 2020 |
ROU assets for operating and finance leases | ||
Operating leases | $ 23,157 | $ 22,754 |
Finance leases | $ 2,646 | $ 2,120 |
Operating Lease, Right-of-Use Asset, Statement of Financial Position [Extensible List] | Other Assets, Noncurrent | Other Assets, Noncurrent |
Finance Lease, Right-of-Use Asset, Statement of Financial Position [Extensible List] | Property, Plant and Equipment, Net | Property, Plant and Equipment, Net |
Real Estate | ||
ROU assets for operating and finance leases | ||
Operating leases | $ 22,518 | $ 22,565 |
Equipment Lease | ||
ROU assets for operating and finance leases | ||
Operating leases | 639 | 189 |
Finance leases | $ 2,646 | $ 2,120 |
LEASES - Operating and finance
LEASES - Operating and finance leases liabilities (Details) - USD ($) $ in Thousands | Dec. 31, 2021 | Dec. 31, 2020 |
Lessee, Lease, Description [Line Items] | ||
Operating Leases | $ 21,379 | $ 20,513 |
Finance Leases | $ 1,001 | $ 823 |
Operating Lease, Liability, Statement of Financial Position [Extensible List] | Accrued liabilities, Other Liabilities | Accrued liabilities, Other Liabilities |
Accrued liabilities | ||
Lessee, Lease, Description [Line Items] | ||
Operating Leases | $ 3,990 | $ 3,171 |
Finance Leases | 960 | 799 |
Other Liabilities | ||
Lessee, Lease, Description [Line Items] | ||
Operating Leases | 17,389 | 17,342 |
Finance Leases | $ 41 | $ 24 |
LEASES - Weighted-average remai
LEASES - Weighted-average remaining lease term and weighted-average discount rate (Details) | Dec. 31, 2021 | Dec. 31, 2020 |
LEASES | ||
Weighted-average remaining lease term (years), Operating Leases | 8 years 1 month 6 days | 9 years 4 months 24 days |
Weighted-average remaining lease term (years), Finance Leases | 8 months 12 days | 7 months 6 days |
Weighted-average discount rate, Operating Leases | 3.50% | 3.60% |
Weighted-average discount rate, Finance Leases | 1.30% | 1.90% |
LEASES - Undiscounted future le
LEASES - Undiscounted future lease payments for operating and finance leases (Details) - USD ($) $ in Thousands | Dec. 31, 2021 | Dec. 31, 2020 |
Operating Leases | ||
2022 | $ 4,605 | |
2023 | 3,821 | |
2024 | 2,978 | |
2025 | 1,669 | |
2026 | 1,692 | |
2027 and thereafter | 9,949 | |
Total lease payments | 24,714 | |
Less imputed interest | (3,335) | |
Total | $ 21,379 | $ 20,513 |
Operating Lease, Liability, Statement of Financial Position [Extensible List] | Accrued liabilities, Other Liabilities | Accrued liabilities, Other Liabilities |
Finance Leases | ||
2022 | $ 964 | |
2023 | 21 | |
2024 | 13 | |
2025 | 8 | |
Total lease payments | 1,006 | |
Less imputed interest | (5) | |
Total | $ 1,001 | $ 823 |
INVESTMENTS (Details)
INVESTMENTS (Details) - USD ($) $ in Thousands | Dec. 31, 2021 | Dec. 31, 2020 |
Available-for-sale | ||
Amortized Cost | $ 1,850,101 | $ 925,559 |
Gross Unrealized Holding Gains | 2 | 165 |
Gross Unrealized Holding Losses | 957 | 79 |
Fair Value | 1,849,146 | 925,645 |
Continuous Unrealized Loss Position less than 12 Months | 957 | 79 |
Short-term | Commercial paper | ||
Available-for-sale | ||
Amortized Cost | 334,077 | 119,886 |
Fair Value | 334,077 | 119,886 |
Short-term | Certificates of deposit | ||
Available-for-sale | ||
Amortized Cost | 44,502 | 20,387 |
Fair Value | 44,502 | 20,387 |
Short-term | Municipal securities | ||
Available-for-sale | ||
Amortized Cost | 666 | 9,083 |
Fair Value | 666 | 9,083 |
Short-term | U.S. government agency securities | ||
Available-for-sale | ||
Amortized Cost | 62,687 | 81,521 |
Gross Unrealized Holding Gains | 13 | |
Gross Unrealized Holding Losses | 26 | 3 |
Fair Value | 62,661 | 81,531 |
Continuous Unrealized Loss Position less than 12 Months | 26 | 3 |
Short-term | U.S. treasuries | ||
Available-for-sale | ||
Amortized Cost | 1,308,536 | 650,386 |
Gross Unrealized Holding Gains | 2 | 150 |
Gross Unrealized Holding Losses | 717 | 69 |
Fair Value | 1,307,821 | 650,467 |
Continuous Unrealized Loss Position less than 12 Months | 717 | 69 |
Long-term | U.S. government agency securities | ||
Available-for-sale | ||
Amortized Cost | 12,500 | 10,350 |
Gross Unrealized Holding Gains | 1 | |
Gross Unrealized Holding Losses | 24 | |
Fair Value | 12,476 | 10,351 |
Continuous Unrealized Loss Position less than 12 Months | 24 | |
Long-term | U.S. treasuries | ||
Available-for-sale | ||
Amortized Cost | 87,133 | 33,946 |
Gross Unrealized Holding Gains | 1 | |
Gross Unrealized Holding Losses | 190 | 7 |
Fair Value | 86,943 | 33,940 |
Continuous Unrealized Loss Position less than 12 Months | $ 190 | $ 7 |
INVESTMENTS - Maturity Period (
INVESTMENTS - Maturity Period (Details) - USD ($) $ in Thousands | Dec. 31, 2021 | Dec. 31, 2020 |
Investments | ||
Amortized Cost | $ 1,850,101 | $ 925,559 |
Fair Value | 1,849,146 | 925,645 |
Commercial paper | Less than 1 year | ||
Investments | ||
Amortized Cost | 334,077 | 119,886 |
Fair Value | 334,077 | 119,886 |
Municipal securities | Less than 1 year | ||
Investments | ||
Amortized Cost | 666 | 9,083 |
Fair Value | 666 | 9,083 |
U.S. government agency securities | Less than 1 year | ||
Investments | ||
Amortized Cost | 62,687 | 81,521 |
Fair Value | 62,661 | 81,531 |
U.S. government agency securities | Due 1 - 10 years | ||
Investments | ||
Amortized Cost | 12,500 | 10,350 |
Fair Value | 12,476 | 10,351 |
Certificates of deposit | Less than 1 year | ||
Investments | ||
Amortized Cost | 44,502 | 20,387 |
Fair Value | 44,502 | 20,387 |
U.S. treasuries | Less than 1 year | ||
Investments | ||
Amortized Cost | 1,308,536 | 650,386 |
Fair Value | 1,307,821 | 650,467 |
U.S. treasuries | Due 1 - 10 years | ||
Investments | ||
Amortized Cost | 87,133 | 33,946 |
Fair Value | $ 86,943 | $ 33,940 |
FAIR VALUE OF CERTAIN FINANCI_3
FAIR VALUE OF CERTAIN FINANCIAL ASSETS AND LIABILITIES (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Fair value of certain financial assets and liabilities | ||
Cash and cash equivalents | $ 1,326,462 | $ 1,180,413 |
Short-term investments | 1,749,727 | 881,354 |
Investments | 99,419 | 44,291 |
Asset transfers between Level 1 and Level 2 measurements | 0 | 0 |
Total fair value | ||
Fair value of certain financial assets and liabilities | ||
Cash | 749,089 | 796,421 |
Foreign currency derivatives | (278) | (2,578) |
Assets measured at fair value | 3,175,330 | 2,103,480 |
Cash and cash equivalents | 1,326,462 | 1,180,413 |
Short-term investments | 1,749,727 | 881,354 |
Accounts receivable, net | 654 | 69 |
Investments | 99,419 | 44,291 |
Accrued liabilities | (932) | (2,647) |
Total fair value | Money market funds | ||
Fair value of certain financial assets and liabilities | ||
Assets measured at fair value | 440,826 | 352,730 |
Total fair value | Certificates of deposit | ||
Fair value of certain financial assets and liabilities | ||
Assets measured at fair value | 44,502 | 23,137 |
Total fair value | Commercial paper | ||
Fair value of certain financial assets and liabilities | ||
Assets measured at fair value | 335,477 | 130,883 |
Total fair value | Municipal securities | ||
Fair value of certain financial assets and liabilities | ||
Assets measured at fair value | 2,428 | 9,083 |
Total fair value | U.S. government agency securities | ||
Fair value of certain financial assets and liabilities | ||
Assets measured at fair value | 75,137 | 91,882 |
Total fair value | U.S. treasuries | ||
Fair value of certain financial assets and liabilities | ||
Assets measured at fair value | 1,528,149 | 701,922 |
Level 1 | ||
Fair value of certain financial assets and liabilities | ||
Cash | 749,089 | 796,421 |
Assets measured at fair value | 1,189,915 | 1,149,151 |
Cash and cash equivalents | 1,189,915 | 1,149,151 |
Level 1 | Money market funds | ||
Fair value of certain financial assets and liabilities | ||
Assets measured at fair value | 440,826 | 352,730 |
Level 2 | ||
Fair value of certain financial assets and liabilities | ||
Foreign currency derivatives | (278) | (2,578) |
Assets measured at fair value | 1,985,415 | 954,329 |
Cash and cash equivalents | 136,547 | 31,262 |
Short-term investments | 1,749,727 | 881,354 |
Accounts receivable, net | 654 | 69 |
Investments | 99,419 | 44,291 |
Accrued liabilities | (932) | (2,647) |
Level 2 | Certificates of deposit | ||
Fair value of certain financial assets and liabilities | ||
Assets measured at fair value | 44,502 | 23,137 |
Level 2 | Commercial paper | ||
Fair value of certain financial assets and liabilities | ||
Assets measured at fair value | 335,477 | 130,883 |
Level 2 | Municipal securities | ||
Fair value of certain financial assets and liabilities | ||
Assets measured at fair value | 2,428 | 9,083 |
Level 2 | U.S. government agency securities | ||
Fair value of certain financial assets and liabilities | ||
Assets measured at fair value | 75,137 | 91,882 |
Level 2 | U.S. treasuries | ||
Fair value of certain financial assets and liabilities | ||
Assets measured at fair value | $ 1,528,149 | $ 701,922 |
DERIVATIVE INSTRUMENTS AND HE_3
DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES - Notional Amount and Fair Value (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Foreign currency exchange contracts | Maximum | ||
Derivative Instruments and Hedging Activities | ||
Term of derivative instrument | 3 months | |
Derivatives not designated as hedging instruments | Accounts receivables, net | Receive SGD/pay USD | ||
Derivative Instruments and Hedging Activities | ||
Notional amount, Assets | $ 16,544 | $ 18,713 |
Fair Value, Assets | 297 | 41 |
Derivatives not designated as hedging instruments | Accounts receivables, net | Receive RSD/pay USD | ||
Derivative Instruments and Hedging Activities | ||
Notional amount, Assets | 9,837 | 10,127 |
Fair Value, Assets | 46 | 28 |
Derivatives not designated as hedging instruments | Accounts receivables, net | Receive USD/pay RUB | ||
Derivative Instruments and Hedging Activities | ||
Notional amount, Assets | 7,175 | |
Fair Value, Assets | 15 | |
Derivatives not designated as hedging instruments | Accounts receivables, net | Receive USD/pay COP | ||
Derivative Instruments and Hedging Activities | ||
Notional amount, Assets | 9,754 | |
Fair Value, Assets | 296 | |
Derivatives not designated as hedging instruments | Accrued liabilities | Receive EUR/pay USD | ||
Derivative Instruments and Hedging Activities | ||
Notional amount, Liabilities | 1,298,899 | |
Fair Value, Liabilities | (1,768) | |
Derivatives not designated as hedging instruments | Accrued liabilities | Receive NOK/pay USD | ||
Derivative Instruments and Hedging Activities | ||
Notional amount, Liabilities | 4,411 | |
Fair Value, Liabilities | (18) | |
Derivatives not designated as hedging instruments | Accrued liabilities | Receive USD/pay GBP | ||
Derivative Instruments and Hedging Activities | ||
Notional amount, Liabilities | 29,929 | 35,256 |
Fair Value, Liabilities | (666) | (416) |
Derivatives not designated as hedging instruments | Accrued liabilities | Receive USD/pay EUR | ||
Derivative Instruments and Hedging Activities | ||
Notional amount, Liabilities | 3,045 | |
Fair Value, Liabilities | (29) | |
Derivatives not designated as hedging instruments | Accrued liabilities | Receive USD/pay RUB | ||
Derivative Instruments and Hedging Activities | ||
Notional amount, Liabilities | 7,780 | |
Fair Value, Liabilities | (40) | |
Derivatives not designated as hedging instruments | Accrued liabilities | Receive USD/pay AUD | ||
Derivative Instruments and Hedging Activities | ||
Notional amount, Liabilities | 2,602 | 8,508 |
Fair Value, Liabilities | (88) | (130) |
Derivatives not designated as hedging instruments | Accrued liabilities | Receive USD/pay CNY | ||
Derivative Instruments and Hedging Activities | ||
Notional amount, Liabilities | 12,230 | 12,344 |
Fair Value, Liabilities | (74) | (50) |
Derivatives not designated as hedging instruments | Accrued liabilities | Receive USD/pay COP | ||
Derivative Instruments and Hedging Activities | ||
Notional amount, Liabilities | 5,436 | |
Fair Value, Liabilities | (93) | |
Derivatives not designated as hedging instruments | Accrued liabilities | Receive USD/pay ZAR | ||
Derivative Instruments and Hedging Activities | ||
Notional amount, Liabilities | 4,140 | 2,403 |
Fair Value, Liabilities | (21) | (106) |
Derivatives not designated as hedging instruments | Accrued liabilities | Receive USD/pay DKK | ||
Derivative Instruments and Hedging Activities | ||
Notional amount, Liabilities | 1,461 | 3,151 |
Fair Value, Liabilities | (9) | (3) |
Derivatives not designated as hedging instruments | Accrued liabilities | Receive USD/pay NZD | ||
Derivative Instruments and Hedging Activities | ||
Notional amount, Liabilities | 2,693 | 2,290 |
Fair Value, Liabilities | $ (45) | (13) |
Derivatives not designated as hedging instruments | Accrued liabilities | Receive SEK/pay USD | ||
Derivative Instruments and Hedging Activities | ||
Notional amount, Liabilities | 2,275 | |
Fair Value, Liabilities | $ (10) |
DERIVATIVE INSTRUMENTS AND HE_4
DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES - Nonhedging Designation (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Derivatives not designated as hedging instruments | Foreign currency exchange contracts | Interest and other income, net | |||
Net gains on derivative instruments | |||
Amount of gain recognized in income on derivatives | $ (5,445) | $ (3,317) | $ (2,555) |
INVENTORIES (Details)
INVENTORIES (Details) - USD ($) $ in Thousands | Dec. 31, 2021 | Dec. 31, 2020 |
INVENTORIES | ||
Raw materials | $ 349,865 | $ 155,166 |
Finished goods | 243,492 | 177,919 |
Inventories | $ 593,357 | $ 333,085 |
PROPERTY AND EQUIPMENT, Net (De
PROPERTY AND EQUIPMENT, Net (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Property and equipment, net | |||
Property and equipment, gross | $ 538,538 | $ 519,410 | |
Less: accumulated depreciation and amortization | (224,785) | (204,754) | |
Property and equipment, net | 313,753 | 314,656 | |
Total depreciation and amortization expense | 45,700 | 49,300 | $ 49,100 |
Land | |||
Property and equipment, net | |||
Property and equipment, gross | 85,455 | 85,876 | |
Leasehold improvements | |||
Property and equipment, net | |||
Property and equipment, gross | 11,845 | 11,524 | |
Furniture and fixtures | |||
Property and equipment, net | |||
Property and equipment, gross | 8,274 | 8,271 | |
Office and computer equipment | |||
Property and equipment, net | |||
Property and equipment, gross | 21,601 | 21,657 | |
Computer software | |||
Property and equipment, net | |||
Property and equipment, gross | 8,383 | 6,945 | |
Equipment | |||
Property and equipment, net | |||
Property and equipment, gross | 190,333 | 185,348 | |
Buildings | |||
Property and equipment, net | |||
Property and equipment, gross | 167,243 | 156,616 | |
Vehicles | |||
Property and equipment, net | |||
Property and equipment, gross | $ 45,404 | $ 43,173 |
GOODWILL AND OTHER INTANGIBLE_3
GOODWILL AND OTHER INTANGIBLE ASSETS - Goodwill (Details) - USD ($) $ in Thousands | Dec. 31, 2021 | Dec. 31, 2020 |
Goodwill | ||
Goodwill, Beginning Balance | $ 1,331,643 | $ 1,331,643 |
Goodwill, Ending Balance | 1,331,643 | 1,331,643 |
Monster Energy Drinks | ||
Goodwill | ||
Goodwill, Beginning Balance | 693,644 | 693,644 |
Goodwill, Ending Balance | 693,644 | 693,644 |
Strategic Brands | ||
Goodwill | ||
Goodwill, Beginning Balance | 637,999 | 637,999 |
Goodwill, Ending Balance | $ 637,999 | $ 637,999 |
GOODWILL AND OTHER INTANGIBLE_4
GOODWILL AND OTHER INTANGIBLE ASSETS - Intangible assets (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Intangible assets | |||
Amortizing intangibles | $ 66,872 | $ 66,875 | |
Accumulated amortization | (61,227) | (56,801) | |
Amortizing intangibles, net | 5,645 | 10,074 | |
Non-amortizing intangibles | 1,066,741 | 1,048,972 | |
Intangibles, net | 1,072,386 | 1,059,046 | |
Amortization expense | 4,400 | 7,700 | $ 11,600 |
Impairment | $ 0 | $ 8,700 | $ 0 |
Minimum | |||
Intangible assets | |||
Useful life of intangible assets | 5 years | ||
Maximum | |||
Intangible assets | |||
Useful life of intangible assets | 7 years |
GOODWILL AND OTHER INTANGIBLE_5
GOODWILL AND OTHER INTANGIBLE ASSETS - Amortization expense (Details) - USD ($) $ in Thousands | Dec. 31, 2021 | Dec. 31, 2020 |
Future estimated amortization expense related to amortizing intangibles | ||
2022 | $ 4,405 | |
2023 | 1,112 | |
2024 | 14 | |
2025 | 13 | |
2026 | 13 | |
2027 and thereafter | 88 | |
Amortizing intangibles, net | $ 5,645 | $ 10,074 |
DISTRIBUTION AGREEMENTS (Detail
DISTRIBUTION AGREEMENTS (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
DISTRIBUTION AGREEMENTS | |||
Termination costs | $ 5.3 | $ 0.2 | $ 11.3 |
Distribution agreement (in years) | 20 years | ||
Revenue recognized | $ 21.5 | $ 21.4 | $ 25 |
DEBT (Details)
DEBT (Details) - USD ($) $ in Millions | 1 Months Ended | ||
Apr. 30, 2020 | Dec. 31, 2021 | Feb. 28, 2018 | |
Comerica | Line of credit | |||
DEBT | |||
Maximum borrowing capacity | $ 10 | ||
Outstanding borrowings | $ 0 | ||
Comerica | Line of credit | Base (prime) rate | Minimum | |||
DEBT | |||
Percentage to be subtracted to compute the variable rate on the debt instrument | 1.00% | ||
Comerica | Line of credit | Base (prime) rate | Maximum | |||
DEBT | |||
Percentage to be subtracted to compute the variable rate on the debt instrument | 1.50% | ||
Comerica | Line of credit | London Interbank Offered Rates | Minimum | |||
DEBT | |||
Percentage that needs to be added to compute the variable rate on the debt instrument | 1.25% | ||
Comerica | Line of credit | London Interbank Offered Rates | Maximum | |||
DEBT | |||
Percentage that needs to be added to compute the variable rate on the debt instrument | 1.75% | ||
Comerica | Standby letters of credit | |||
DEBT | |||
Maximum borrowing capacity | $ 4 | ||
Amount outstanding | 0 | ||
Comerica | Standby letters of credit | Minimum | |||
DEBT | |||
Fee (as a percent) | 1.00% | ||
Comerica | Standby letters of credit | Maximum | |||
DEBT | |||
Fee (as a percent) | 1.50% | ||
HSBC China | Line of credit | |||
DEBT | |||
Maximum borrowing capacity | $ 15 | ||
Amount outstanding | $ 5.8 | ||
Interest rate (as a percent) | 5.50% |
COMMITMENTS AND CONTINGENCIES -
COMMITMENTS AND CONTINGENCIES - Contractual obligations (Details) $ in Thousands | Dec. 31, 2021USD ($) |
COMMITMENTS AND CONTINGENCIES | |
2022 | $ 236,698 |
2023 | 57,848 |
2024 | 10,497 |
2025 | 10 |
Total | $ 305,053 |
COMMITMENTS AND CONTINGENCIES_2
COMMITMENTS AND CONTINGENCIES - Purchase Commitments (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Purchase Commitments | |||
Aggregate value of raw material purchases | $ 698 | $ 401.8 | $ 335.3 |
Raw material items | |||
Purchase Commitments | |||
Purchase commitments | $ 273.4 | ||
Obligation term ( in years) | 1 year |
COMMITMENTS AND CONTINGENCIES_3
COMMITMENTS AND CONTINGENCIES - Litigation (Details) $ in Thousands | Dec. 31, 2021USD ($) |
COMMITMENTS AND CONTINGENCIES | |
Loss contingencies | $ 0 |
ACCUMULATED OTHER COMPREHENSI_3
ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) (Details) - USD ($) $ in Thousands | Dec. 31, 2021 | Dec. 31, 2020 |
Components of accumulated other comprehensive loss: | ||
Accumulated net unrealized (loss) gain on available-for-sale securities | $ (956) | $ 84 |
Foreign currency translation adjustments, net of tax | (68,209) | 2,950 |
Total accumulated other comprehensive income (loss) | $ (69,165) | $ 3,034 |
TREASURY STOCK PURCHASE (Detail
TREASURY STOCK PURCHASE (Details) - USD ($) shares in Thousands, $ in Millions | 12 Months Ended | ||
Dec. 31, 2021 | Feb. 28, 2022 | Mar. 13, 2020 | |
Treasury Stock Purchase | |||
Number of shares repurchased of common stock from employees in lieu of cash or withholding taxes due | 200 | ||
Cash payment for repurchase of common stock from employees in lieu of cash or withholding taxes due | $ 13.8 | ||
March 2020 Repurchase Plan | |||
Treasury Stock Purchase | |||
Share repurchase program, authorized amount | $ 441.5 | $ 500 | |
Number of shares repurchased of common stock from employees in lieu of cash or withholding taxes due | 0 |
STOCK-BASED COMPENSATION - Plan
STOCK-BASED COMPENSATION - Plans (Details) $ in Millions | 3 Months Ended | 12 Months Ended | |||||
Dec. 31, 2021shares | Sep. 30, 2021shares | Jun. 30, 2021shares | Mar. 31, 2021shares | Dec. 31, 2021USD ($)planshares | Dec. 31, 2020USD ($) | Dec. 31, 2019USD ($)shares | |
STOCK-BASED COMPENSATION | |||||||
Stock-based compensation plans | plan | 2 | ||||||
Aggregate amount of common stock authorized (in shares) | 46,169,367 | 46,169,367 | |||||
Compensation expense on share-based plans | $ | $ 70.5 | $ 70.3 | $ 63.4 | ||||
Excess tax benefit realized for tax deductions from non-qualified stock option exercises and disqualifying dispositions of incentive stock options | $ | $ 6.8 | $ 10.5 | $ 25.9 | ||||
Stock options | |||||||
STOCK-BASED COMPENSATION | |||||||
Common stock granted, net of cancellations (in shares) | 12,000 | 23,000 | 13,000 | 1,015,000 | |||
2020 Omnibus Incentive Plan | |||||||
STOCK-BASED COMPENSATION | |||||||
Aggregate amount of common stock authorized (in shares) | 32,000,000 | 32,000,000 | |||||
Reduction in number of shares for each share granted | 1 | ||||||
Shares available for grant | 42,513,457 | 42,513,457 | |||||
2020 Omnibus Incentive Plan | Restricted Stock Units and Performance Share Units | Minimum | |||||||
STOCK-BASED COMPENSATION | |||||||
Expiration period (in years) | 3 years | ||||||
Vesting period | 3 years | ||||||
2020 Omnibus Incentive Plan | Restricted Stock Units and Performance Share Units | Maximum | |||||||
STOCK-BASED COMPENSATION | |||||||
Vesting period | 5 years | ||||||
2020 Omnibus Incentive Plan | Stock options | |||||||
STOCK-BASED COMPENSATION | |||||||
Expiration period (in years) | 10 years | ||||||
2020 Omnibus Incentive Plan | Stock options | Maximum | |||||||
STOCK-BASED COMPENSATION | |||||||
Expiration period (in years) | 5 years | ||||||
2011 Omnibus Incentive Plan | |||||||
STOCK-BASED COMPENSATION | |||||||
Aggregate amount of common stock authorized (in shares) | 14,169,367 | ||||||
Reduction in number of shares for each share granted | 2.6 | ||||||
Common stock granted, net of cancellations (in shares) | 2,755,257 | ||||||
2017 Directors plan | |||||||
STOCK-BASED COMPENSATION | |||||||
Aggregate amount of common stock authorized (in shares) | 1,250,000 | 1,250,000 | |||||
Shares available for grant | 1,151,099 | 1,151,099 | |||||
Common stock granted, net of cancellations (in shares) | 98,901 |
STOCK-BASED COMPENSATION - Fair
STOCK-BASED COMPENSATION - Fair Value Assumptions (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 12 Months Ended | |||||
Dec. 31, 2021 | Sep. 30, 2021 | Jun. 30, 2021 | Mar. 31, 2021 | Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Weighted-average assumptions used to estimate the fair value of options granted | |||||||
Dividend yield (as a percent) | 0.00% | 0.00% | 0.00% | ||||
Expected volatility (as a percent) | 28.90% | 30.40% | 30.20% | ||||
Risk-free interest rate (as a percent) | 0.85% | 0.70% | 2.37% | ||||
Expected term | 5 years 9 months 18 days | 5 years 9 months 18 days | 6 years | ||||
2011 Omnibus Incentive Plan | |||||||
Stock options, Number of Shares | |||||||
Granted (in shares) | 2,755,257 | ||||||
2017 Directors plan | |||||||
Stock options, Number of Shares | |||||||
Granted (in shares) | 98,901 | ||||||
Stock options | |||||||
Stock options, Number of Shares | |||||||
Balance at the beginning of the period (in shares) | 13,973,000 | 13,973,000 | |||||
Granted (in shares) | 12,000 | 23,000 | 13,000 | 1,015,000 | |||
Exercised (in shares) | (1,037,000) | ||||||
Cancelled or forfeited (in shares) | (139,000) | ||||||
Balance at the end of the period (in shares) | 13,860,000 | 13,860,000 | 13,973,000 | ||||
Vested and expected to vest in the future at the end of the period (in shares) | 13,633,000 | 13,633,000 | |||||
Exercisable at the end of the period (in shares) | 9,644,000 | 9,644,000 | |||||
Stock options, Weighted-Average Exercise Price Per Share | |||||||
Balance at the beginning of the period (in dollars per share) | $ 44.93 | $ 44.93 | |||||
Granted (in dollars per share) | $ 87 | $ 95.33 | $ 91.36 | $ 88.95 | |||
Exercised (in dollars per share) | 44.10 | ||||||
Cancelled or forfeited (in dollars per share) | 63.05 | ||||||
Balance at the end of the period (in dollars per share) | 48.19 | 48.19 | $ 44.93 | ||||
Vested and expected to vest in the future at the end of the period (in dollars per share) | 47.80 | 47.80 | |||||
Exercisable at the end of the period (in dollars per share) | $ 40.33 | $ 40.33 | |||||
Weighted-Average Remaining Contractual Term (in years) | |||||||
Weighted-Average Remaining Contractual Terms (in years) | 5 years 1 month 6 days | 5 years 8 months 12 days | |||||
Vested and expected to vest in the future at the end of the period | 5 years | ||||||
Exercisable at the end of the period | 4 years | ||||||
Aggregate Intrinsic Value | |||||||
Balance at the beginning of the period | $ 664,432 | $ 664,432 | |||||
Balance at the end of the period | $ 663,148 | 663,148 | $ 664,432 | ||||
Vested and expected to vest in the future at the end of the period | 657,633 | 657,633 | |||||
Exercisable at the end of the period | $ 537,261 | $ 537,261 |
STOCK-BASED COMPENSATION - Equi
STOCK-BASED COMPENSATION - Equity Awards (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | 12 Months Ended | |||||
Dec. 31, 2021 | Sep. 30, 2021 | Jun. 30, 2021 | Mar. 31, 2021 | Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
STOCK-BASED COMPENSATION | |||||||
Total employee and non-employee share-based compensation expense included in income, before income tax | $ 70,483 | $ 70,289 | $ 63,356 | ||||
Compensation cost charged against income | |||||||
Operating expenses | 70,483 | 70,289 | 63,356 | ||||
Less: Amount of income tax benefit recognized in earnings | (14,228) | (15,499) | (36,326) | ||||
Amount charged against net income | 56,255 | 54,790 | 27,030 | ||||
Operating expense | |||||||
STOCK-BASED COMPENSATION | |||||||
Total employee and non-employee share-based compensation expense included in income, before income tax | $ 70,500 | $ 70,300 | $ 63,400 | ||||
Stock options | |||||||
STOCK-BASED COMPENSATION | |||||||
Weighted-average grant-date fair value of options granted (in dollars per share) | $ 25.80 | $ 18.82 | $ 20.17 | ||||
Total intrinsic value of options exercised | $ 51,200 | $ 68,800 | $ 220,200 | ||||
Cash received from option exercises | 45,700 | $ 72,900 | $ 92,400 | ||||
Total unrecognized compensation expense related to non-vested shares granted to employees | $ 51,300 | $ 51,300 | |||||
Cost expected to be recognized over a weighted-average period | 2 years 1 month 6 days | ||||||
Stock units expected to vest (in shares) | 13,633 | 13,633 | |||||
Restricted stock units | |||||||
STOCK-BASED COMPENSATION | |||||||
Total unrecognized compensation expense related to non-vested shares granted to employees | $ 34,800 | $ 34,800 | |||||
Cost expected to be recognized over a weighted-average period | 1 year 10 months 24 days | ||||||
Stock units expected to vest (in shares) | 800 | 800 | |||||
Number of Shares | |||||||
Non-vested at the beginning of the period (in shares) | 947 | 947 | |||||
Granted (in shares) | 1 | 1 | 14 | 304 | |||
Vested (in shares) | (344) | ||||||
Forfeited/cancelled (in shares) | (13) | ||||||
Non-vested at the end of the period (in shares) | 910 | 910 | 947 | ||||
Weighted Average Grant-Date Fair Value | |||||||
Non-vested at the beginning of the period (in dollars per share) | $ 60.52 | $ 60.52 | |||||
Granted (in dollars per share) | $ 89.95 | $ 89.84 | $ 92.14 | $ 86.28 | 89.12 | $ 62.97 | $ 59.79 |
Vested (in dollars per share) | 62.29 | ||||||
Forfeited/cancelled (in dollars per share) | 60.41 | ||||||
Non-vested at the end of the period (in dollars per share) | $ 69.02 | $ 69.02 | $ 60.52 | ||||
Performance Share Units | |||||||
STOCK-BASED COMPENSATION | |||||||
Percentage of Target Performance Level | 100.00% | ||||||
Performance Share Units | Maximum | |||||||
STOCK-BASED COMPENSATION | |||||||
Percentage of Target Performance Level | 200.00% | ||||||
Performance Share Units | Minimum | |||||||
STOCK-BASED COMPENSATION | |||||||
Percentage of Target Performance Level | 0.00% | ||||||
Incentive Stock Options. | |||||||
STOCK-BASED COMPENSATION | |||||||
Total employee and non-employee share-based compensation expense included in income, before income tax | $ 8,300 | $ 9,400 | $ 10,000 | ||||
Non Qualified Stock Options. | |||||||
STOCK-BASED COMPENSATION | |||||||
Total employee and non-employee share-based compensation expense included in income, before income tax | 60,600 | 58,200 | $ 53,400 | ||||
Other share-based awards | |||||||
STOCK-BASED COMPENSATION | |||||||
Total unrecognized compensation expense related to non-vested shares granted to employees | $ 700 | $ 700 | |||||
Cost expected to be recognized over a weighted-average period | 1 year | ||||||
Total employee and non-employee share-based compensation expense included in income, before income tax | $ 1,600 | $ 2,700 |
STOCK-BASED COMPENSATION - Exer
STOCK-BASED COMPENSATION - Exercise Prices (Details) shares in Thousands | 12 Months Ended |
Dec. 31, 2021$ / sharesshares | |
Stock options outstanding and stock options exercisable | |
Number Outstanding (in shares) | shares | 13,860 |
Options Outstanding, Weighted Average Remaining Contractual Term (Years) | 5 years 1 month 6 days |
Options Outstanding, Weighted Average Exercise Price (in dollars per share) | $ 48.19 |
Options Exercisable (in shares) | shares | 9,644 |
Options Exercisable, Weighted Average Exercise Price (in dollars per share) | $ 40.33 |
Range of Exercise Prices $15.71 - $17.99 | |
Stock options outstanding and stock options exercisable | |
Stock options, range of exercise prices, low end of range (in dollars per share) | 15.71 |
Stock options, range of exercise prices, high end of range (in dollars per share) | $ 17.99 |
Number Outstanding (in shares) | shares | 1,395 |
Options Outstanding, Weighted Average Remaining Contractual Term (Years) | 1 year 4 months 24 days |
Options Outstanding, Weighted Average Exercise Price (in dollars per share) | $ 17.77 |
Options Exercisable (in shares) | shares | 1,395 |
Options Exercisable, Weighted Average Exercise Price (in dollars per share) | $ 17.77 |
Range of Exercise Prices $18.64 - $23.35 | |
Stock options outstanding and stock options exercisable | |
Stock options, range of exercise prices, low end of range (in dollars per share) | 18.64 |
Stock options, range of exercise prices, high end of range (in dollars per share) | $ 23.35 |
Number Outstanding (in shares) | shares | 1,562 |
Options Outstanding, Weighted Average Remaining Contractual Term (Years) | 2 years 1 month 6 days |
Options Outstanding, Weighted Average Exercise Price (in dollars per share) | $ 23.08 |
Options Exercisable (in shares) | shares | 1,562 |
Options Exercisable, Weighted Average Exercise Price (in dollars per share) | $ 23.08 |
Range of Exercise Prices $36.05 - $36.05 | |
Stock options outstanding and stock options exercisable | |
Stock options, range of exercise prices, low end of range (in dollars per share) | 36.05 |
Stock options, range of exercise prices, high end of range (in dollars per share) | $ 36.05 |
Number Outstanding (in shares) | shares | 9 |
Options Outstanding, Weighted Average Remaining Contractual Term (Years) | 3 years |
Options Outstanding, Weighted Average Exercise Price (in dollars per share) | $ 36.05 |
Options Exercisable (in shares) | shares | 9 |
Options Exercisable, Weighted Average Exercise Price (in dollars per share) | $ 36.05 |
Range of Exercise Prices $37.10 - $43.99 | |
Stock options outstanding and stock options exercisable | |
Stock options, range of exercise prices, low end of range (in dollars per share) | 37.10 |
Stock options, range of exercise prices, high end of range (in dollars per share) | $ 43.99 |
Number Outstanding (in shares) | shares | 2,280 |
Options Outstanding, Weighted Average Remaining Contractual Term (Years) | 4 years 3 months 18 days |
Options Outstanding, Weighted Average Exercise Price (in dollars per share) | $ 43.47 |
Options Exercisable (in shares) | shares | 2,272 |
Options Exercisable, Weighted Average Exercise Price (in dollars per share) | $ 43.47 |
Range of Exercise Prices $44.73 - $45.16 | |
Stock options outstanding and stock options exercisable | |
Stock options, range of exercise prices, low end of range (in dollars per share) | 44.73 |
Stock options, range of exercise prices, high end of range (in dollars per share) | $ 45.16 |
Number Outstanding (in shares) | shares | 1,410 |
Options Outstanding, Weighted Average Remaining Contractual Term (Years) | 3 years 4 months 24 days |
Options Outstanding, Weighted Average Exercise Price (in dollars per share) | $ 45.10 |
Options Exercisable (in shares) | shares | 1,410 |
Options Exercisable, Weighted Average Exercise Price (in dollars per share) | $ 45.10 |
Range of Exercise Prices $45.55 - $54.45 | |
Stock options outstanding and stock options exercisable | |
Stock options, range of exercise prices, low end of range (in dollars per share) | 45.55 |
Stock options, range of exercise prices, high end of range (in dollars per share) | $ 54.45 |
Number Outstanding (in shares) | shares | 1,491 |
Options Outstanding, Weighted Average Remaining Contractual Term (Years) | 5 years 6 months |
Options Outstanding, Weighted Average Exercise Price (in dollars per share) | $ 48.21 |
Options Exercisable (in shares) | shares | 1,058 |
Options Exercisable, Weighted Average Exercise Price (in dollars per share) | $ 47.43 |
Range of Exercise Prices $55.14 - $57.95 | |
Stock options outstanding and stock options exercisable | |
Stock options, range of exercise prices, low end of range (in dollars per share) | 55.14 |
Stock options, range of exercise prices, high end of range (in dollars per share) | $ 57.95 |
Number Outstanding (in shares) | shares | 153 |
Options Outstanding, Weighted Average Remaining Contractual Term (Years) | 7 years 1 month 6 days |
Options Outstanding, Weighted Average Exercise Price (in dollars per share) | $ 56.90 |
Options Exercisable (in shares) | shares | 36 |
Options Exercisable, Weighted Average Exercise Price (in dollars per share) | $ 56.57 |
Range of Exercise Prices $58.73 - $58.73 | |
Stock options outstanding and stock options exercisable | |
Stock options, range of exercise prices, low end of range (in dollars per share) | 58.73 |
Stock options, range of exercise prices, high end of range (in dollars per share) | $ 58.73 |
Number Outstanding (in shares) | shares | 2,054 |
Options Outstanding, Weighted Average Remaining Contractual Term (Years) | 6 years 2 months 12 days |
Options Outstanding, Weighted Average Exercise Price (in dollars per share) | $ 58.73 |
Options Exercisable (in shares) | shares | 1,084 |
Options Exercisable, Weighted Average Exercise Price (in dollars per share) | $ 58.73 |
Range of Exercise Prices $58.77 - $58.77 | |
Stock options outstanding and stock options exercisable | |
Stock options, range of exercise prices, low end of range (in dollars per share) | 58.77 |
Stock options, range of exercise prices, high end of range (in dollars per share) | $ 58.77 |
Number Outstanding (in shares) | shares | 4 |
Options Outstanding, Weighted Average Remaining Contractual Term (Years) | 6 years 7 months 6 days |
Options Outstanding, Weighted Average Exercise Price (in dollars per share) | $ 58.77 |
Options Exercisable (in shares) | shares | 2 |
Options Exercisable, Weighted Average Exercise Price (in dollars per share) | $ 58.77 |
Range of Exercise Prices $59.67 - $97.80 | |
Stock options outstanding and stock options exercisable | |
Stock options, range of exercise prices, low end of range (in dollars per share) | 59.67 |
Stock options, range of exercise prices, high end of range (in dollars per share) | $ 97.80 |
Number Outstanding (in shares) | shares | 3,502 |
Options Outstanding, Weighted Average Remaining Contractual Term (Years) | 8 years 1 month 6 days |
Options Outstanding, Weighted Average Exercise Price (in dollars per share) | $ 69.29 |
Options Exercisable (in shares) | shares | 816 |
Options Exercisable, Weighted Average Exercise Price (in dollars per share) | $ 60.56 |
INCOME TAXES - Classification a
INCOME TAXES - Classification and Reconciliation (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Domestic and foreign components of company's income before income taxes | |||
Domestic | $ 1,431,797 | $ 1,374,402 | $ 1,196,883 |
Foreign | 369,622 | 251,755 | 219,079 |
INCOME BEFORE PROVISION FOR INCOME TAXES | 1,801,419 | 1,626,157 | 1,415,962 |
Intercompany royalties, management fees and interest charges from the Company's domestic to foreign entities | 61,100 | 54,200 | 51,200 |
Current: | |||
Federal | 273,115 | 259,073 | 212,068 |
State | 44,990 | 43,704 | 39,982 |
Foreign | 89,410 | 70,658 | 55,167 |
Total current provision | 407,515 | 373,435 | 307,217 |
Deferred: | |||
Federal | 14,750 | 11,401 | 8,320 |
State | 4,689 | 4,709 | (6,878) |
Foreign | 5,092 | (167,595) | (4,219) |
Total deferred provision | 24,531 | (151,485) | (2,777) |
Valuation allowance | (8,102) | (5,387) | 3,687 |
Total provision for income taxes | $ 423,944 | $ 216,563 | $ 308,127 |
Federal statutory rate (as a percent) | 21.00% | 21.00% | 21.00% |
Reconciliation of income tax expense | |||
U.S. Federal tax expense at statutory rates | $ 378,298 | $ 341,493 | $ 297,352 |
State income taxes, net of federal tax benefit | 38,894 | 37,478 | 30,098 |
Permanent differences | (4,168) | (1,064) | (2,128) |
Stock based compensation | 2,790 | 1,097 | (13,473) |
Intra-company transfer benefit | (165,075) | ||
Other | (649) | (7,388) | (12,423) |
Foreign rate differential | 16,881 | 15,409 | 5,014 |
Valuation allowance | (8,102) | (5,387) | 3,687 |
Total provision for income taxes | $ 423,944 | $ 216,563 | $ 308,127 |
INCOME TAXES - Unrecognized Tax
INCOME TAXES - Unrecognized Tax Benefit Rollforward (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Gross unrecognized tax benefits, roll forward | |||
Balance at the beginning of the period | $ 742 | $ 2,993 | $ 5,035 |
Additions for tax positions related to the prior years | 1,833 | ||
Decreases for tax positions related to prior years | $ (742) | (2,251) | (3,875) |
Balance at the end of the period | $ 742 | $ 2,993 |
INCOME TAXES - Deferred Taxes (
INCOME TAXES - Deferred Taxes (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Deferred Tax Assets: | ||||
Reserve for sales returns | $ 275 | $ 889 | $ 275 | |
Reserve for inventory obsolescence | 2,366 | 3,643 | 2,366 | |
Reserve for marketing development fund | 9,629 | 8,951 | 9,629 | |
Capitalization of inventory costs | 3,365 | 2,533 | 3,365 | |
State franchise tax - current | 4,229 | 2,493 | 4,229 | |
Accrued compensation | 1,284 | 2,854 | 1,284 | |
Accrued other liabilities | 7,464 | 4,634 | 7,464 | |
Deferred revenue | 75,592 | 68,557 | 75,592 | |
Stock-based compensation | 23,370 | 24,635 | 23,370 | |
Foreign net operating loss carryforward | 21,626 | 14,507 | 21,626 | |
Prepaid supplies | 5,551 | 6,317 | 5,551 | |
Termination payments | 63,009 | 58,042 | 63,009 | |
Operating lease liabilities | 4,434 | 4,711 | 4,434 | |
Intangibles | 87,687 | 72,666 | 87,687 | |
Impairment-trademarks and others | 2,055 | 2,047 | 2,055 | |
Other deferred tax assets | 27,164 | 33,013 | 27,164 | |
Total gross deferred tax assets | 339,100 | 310,492 | 339,100 | |
Deferred Tax Liabilities: | ||||
Amortization of trademarks | (42,161) | (41,517) | (42,161) | |
State franchise tax - deferred | (6,318) | (5,505) | (6,318) | |
Operating lease ROU assets | (4,434) | (4,711) | (4,434) | |
Other deferred tax liabilities | (58) | (618) | (58) | |
Depreciation | (9,363) | (5,907) | (9,363) | |
Total gross deferred tax liabilities | (62,334) | (58,258) | (62,334) | |
Valuation Allowance | (35,116) | (27,013) | (35,116) | |
Net deferred tax assets | 241,650 | 225,221 | 241,650 | |
Increase to provision for income taxes | 8,100 | $ 5,400 | $ 3,700 | |
Net operating loss carryforwards | 60,500 | |||
Net operating loss carryforwards subject to indefinite carryforward | 35,200 | |||
Net operating loss carryforwards that begin to expire in 2022 | $ 25,300 | |||
Recognized deferred tax assets | $ 165,100 |
EARNINGS PER SHARE (Details)
EARNINGS PER SHARE (Details) - shares shares in Thousands | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Weighted-average shares outstanding: | |||
Basic | 528,763 | 529,639 | 542,191 |
Dilutive securities | 6,876 | 5,168 | 4,417 |
Diluted | 535,639 | 534,807 | 546,608 |
Options and awards outstanding excluded from the calculations as their effect would have been antidilutive (in shares) | 800 | 1,800 | 4,400 |
EMPLOYEE BENEFIT PLAN (Details)
EMPLOYEE BENEFIT PLAN (Details) - Employee 401(k) Plan - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Employee Benefit Plant | |||
Employer matching contribution as a percentage of the employee's contribution | 50.00% | ||
Percent of employee's earnings eligible for employer matching contribution | 8.00% | ||
Vesting period of contribution by the company | 4 years | ||
Matching contributions by the company | $ 5.5 | $ 4.7 | $ 3.4 |
2 years of service | |||
Employee Benefit Plant | |||
Percentage of award vesting | 50.00% | ||
3 years of service | |||
Employee Benefit Plant | |||
Percentage of award vesting | 75.00% | ||
4 years of service | |||
Employee Benefit Plant | |||
Percentage of award vesting | 100.00% |
SEGMENT INFORMATION - Net Reven
SEGMENT INFORMATION - Net Revenues (Details) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2021USD ($)segment | Dec. 31, 2020USD ($) | Dec. 31, 2019USD ($) | |
Segment information | |||
Number of reportable segments | segment | 3 | ||
Number of operating segments | segment | 3 | ||
Total Net Sales | $ 5,541,352 | $ 4,598,638 | $ 4,200,819 |
Operating income | 1,797,467 | 1,633,153 | 1,402,939 |
Income before tax | 1,801,419 | 1,626,157 | 1,415,962 |
Recognition of deferred revenue | 21,500 | 21,400 | 25,000 |
Corporate and Unallocated | |||
Segment information | |||
Operating income | 373,913 | 348,170 | 330,741 |
Income before tax | (371,440) | (355,448) | (318,764) |
Monster Energy Drinks | |||
Segment information | |||
Total Net Sales | 5,220,673 | 4,305,246 | 3,904,029 |
Monster Energy Drinks | Operating segment | |||
Segment information | |||
Total Net Sales | 5,220,673 | 4,305,246 | 3,904,029 |
Operating income | 1,990,785 | 1,820,346 | 1,565,977 |
Income before tax | 1,992,185 | 1,820,625 | 1,567,022 |
Recognition of deferred revenue | 41,500 | 42,100 | 46,300 |
Strategic Brands | |||
Segment information | |||
Total Net Sales | 294,762 | 266,354 | 274,925 |
Strategic Brands | Operating segment | |||
Segment information | |||
Total Net Sales | 294,762 | 266,354 | 274,925 |
Operating income | 173,660 | 155,047 | 164,053 |
Income before tax | 173,739 | 155,047 | 164,049 |
Other | |||
Segment information | |||
Total Net Sales | 25,917 | 27,038 | 21,865 |
Other | Operating segment | |||
Segment information | |||
Total Net Sales | 25,917 | 27,038 | 21,865 |
Operating income | 6,935 | 5,930 | 3,650 |
Income before tax | $ 6,935 | $ 5,933 | $ 3,655 |
SEGMENT INFORMATION - Depreciat
SEGMENT INFORMATION - Depreciation and Amortization (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Segment information | |||
Depreciation and amortization | $ 50,155 | $ 57,030 | $ 60,727 |
Depreciation and amortization | 50,155 | 57,030 | 60,727 |
Corporate and Unallocated | |||
Segment information | |||
Depreciation and amortization | 10,053 | 9,944 | 8,758 |
Monster Energy Drinks | Operating segment | |||
Segment information | |||
Depreciation and amortization | 34,532 | 38,277 | 39,397 |
Strategic Brands | Operating segment | |||
Segment information | |||
Depreciation and amortization | 1,085 | 4,178 | 7,935 |
Other | Operating segment | |||
Segment information | |||
Depreciation and amortization | $ 4,485 | $ 4,631 | $ 4,637 |
SEGMENT INFORMATION - Expenses
SEGMENT INFORMATION - Expenses (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Segment information | |||
Operating income (loss) | $ 1,797,467 | $ 1,633,153 | $ 1,402,939 |
Stock-based compensation expense | 70,500 | 70,300 | 63,400 |
Corporate and Unallocated | |||
Segment information | |||
Operating income (loss) | 373,913 | 348,170 | 330,741 |
Payroll costs | 258,600 | 234,100 | 203,300 |
Stock-based compensation expense | 70,300 | 69,900 | 63,400 |
Professional service expenses | 77,900 | 67,600 | 78,500 |
Insurance costs | 9,300 | 7,500 | 6,100 |
Other operating expenses | $ 28,100 | $ 39,000 | $ 42,800 |
SEGMENT INFORMATION - Concentra
SEGMENT INFORMATION - Concentration Risk (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Segment information | |||
Total Net Sales | $ 5,541,352 | $ 4,598,638 | $ 4,200,819 |
Sales | Outside United States | |||
Segment information | |||
Total Net Sales | $ 2,040,000 | $ 1,510,000 | $ 1,330,000 |
TCCC | Sales | Customer concentration | |||
Segment information | |||
Percentage of net sales | 2.00% | 2.00% | 2.00% |
TCCC | Sales | Customer concentration | Outside United States | |||
Segment information | |||
Percentage of net sales | 37.00% | 33.00% | 32.00% |
Coca-Cola Consolidated, Inc | Sales | Customer concentration | |||
Segment information | |||
Percentage of net sales | 12.00% | 12.00% | 13.00% |
Reyes Coca-Cola Bottling | Sales | Customer concentration | |||
Segment information | |||
Percentage of net sales | 10.00% | 11.00% | 11.00% |
Coca-Cola European Partners | Sales | Customer concentration | |||
Segment information | |||
Percentage of net sales | 12.00% | 10.00% | 10.00% |
SEGMENT INFORMATION - Goodwill
SEGMENT INFORMATION - Goodwill and other intangible assets (Details) - USD ($) $ in Thousands | Dec. 31, 2021 | Dec. 31, 2020 |
Segment information | ||
Goodwill and other intangible assets | $ 2,404,029 | $ 2,390,689 |
Monster Energy Drinks | Operating segment | ||
Segment information | ||
Goodwill and other intangible assets | 1,420,503 | 1,406,646 |
Strategic Brands | Operating segment | ||
Segment information | ||
Goodwill and other intangible assets | 978,032 | 974,132 |
Other | Operating segment | ||
Segment information | ||
Goodwill and other intangible assets | $ 5,494 | $ 9,911 |
RELATED PARTY TRANSACTIONS (Det
RELATED PARTY TRANSACTIONS (Details) $ in Thousands | 12 Months Ended | |||
Dec. 31, 2021USD ($)director | Dec. 31, 2020USD ($) | Dec. 31, 2019USD ($) | Dec. 31, 2018USD ($) | |
Related party transactions | ||||
Equity loss | $ 6,566,951 | $ 5,160,860 | $ 4,171,281 | $ 3,610,901 |
TCCC | ||||
Related party transactions | ||||
Net sales | 120,400 | 83,300 | 79,500 | |
Purchases from related party | $ 27,200 | 23,900 | 25,400 | |
TCCC | Voting interests | ||||
Related party transactions | ||||
Related Party Ownership Interest (as a percent) | 19.30% | |||
TCCC Subsidiaries and TCCC Related parties | ||||
Related party transactions | ||||
Commission expenses | $ 77,500 | 56,500 | 50,100 | |
TCCC Related parties and TCCC Independent Bottlers | Operating expense | ||||
Related party transactions | ||||
Commission expenses | 28,700 | 21,400 | 17,700 | |
TCCC Subsidiaries | ||||
Related party transactions | ||||
Accounts receivable, net | 94,647 | 44,925 | ||
Accounts payable | (35,248) | (30,792) | ||
Accrued promotional allowances | (4,536) | (5,834) | ||
Accrued liabilities | (26,616) | (15,446) | ||
TCCC Subsidiaries | Monster Energy Drinks | ||||
Related party transactions | ||||
Contract manufacturing expenses | $ 31,500 | 17,200 | 17,100 | |
Principal owners | ||||
Related party transactions | ||||
Number of directors | director | 1 | |||
Expenses incurred in connection with materials or services provided by a related party | $ 3,600 | $ 2,100 | $ 1,500 | |
Director that serves as counsel | ||||
Related party transactions | ||||
Ownership percentage | 50.00% | |||
Partnership contribution | 1,400 | $ 1,900 | ||
Equity loss | $ (200) |
SUBSEQUENT EVENTS (Details)
SUBSEQUENT EVENTS (Details) $ in Millions | Feb. 17, 2022USD ($) |
Subsequent event | |
Subsequent Event [Line Items] | |
Consideration transferred | $ 330 |
SCHEDULE II - VALUATION AND Q_2
SCHEDULE II - VALUATION AND QUALIFYING ACCOUNTS (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Allowance for doubtful accounts, sales returns and cash discounts | |||
Changes to valuation allowance | |||
Balance at beginning of period | $ 1,878 | $ 2,045 | $ 1,589 |
Charged to cost and expenses | 14,799 | 9,664 | 9,583 |
Deductions | (12,001) | (9,831) | (9,127) |
Balance at end of period | 4,676 | 1,878 | 2,045 |
Allowance on Deferred Tax Assets and Unrecognized Tax Benefits | |||
Changes to valuation allowance | |||
Balance at beginning of period | 35,993 | 43,853 | 42,748 |
Charged to cost and expenses | (8,980) | (7,860) | 1,105 |
Balance at end of period | $ 27,013 | $ 35,993 | $ 43,853 |