Balance Sheet Information and Other

3 Months Ended

Apr. 01, 2022

Balance Sheet Related Disclosures [Abstract]

Balance Sheet Information and Other

Note 6: Balance Sheet Information and Other

Goodwill

There was an insignificant change in the balance of goodwill from December 31, 2021 to April 1, 2022 relating to the divestiture of a business.

Goodwill is tested for impairment annually on the first day of the fourth quarter or more frequently if events or changes in circumstances (each, a "triggering event") would more likely than not reduce the carrying value of goodwill below its fair value. Management did not identify any triggering events during the quarter ended April 1, 2022 that would require an interim impairment analysis.

Inventory

Details of Inventory included in the Company’s Consolidated Balance Sheets are as follows (in millions):

	As of
	April 1, 2022		December 31, 2021
Inventories:
Raw materials	$	193.5	$	174.2
Work in process	971.5		888.9
Finished goods	331.0		316.4
	$	1,496.0	$	1,379.5

Other current assets

Assets classified as held-for-sale, consisting of properties and certain other assets, are required to be recorded at the lower of carrying value or fair value less costs to sell. Fixed assets of approximately $70 million have been classified as held-for-sale within other current assets as of April 1, 2022.

Defined Benefit Plans

The Company recognizes the aggregate amount of all over-funded plans as assets and the aggregate amount of all underfunded plans as liabilities in its financial statements. As of April 1, 2022, the net assets for the over-funded plans totaled $14.3 million. The total accrued pension liability for underfunded plans was $112.6 million, of which the current portion of $0.2 million was classified as accrued expenses and other current liabilities. As of December 31, 2021, the net funded status for all the plans was a liability of $103.9 million, of which the current portion of $0.2 million was classified as accrued expenses and other current liabilities.

The components of the net periodic pension expense were as follows (in millions):

	Quarters Ended
	April 1, 2022		April 2, 2021
Service cost	$	2.2	$	3.1
Interest cost	1.1		1.1
Expected return on plan assets	(1.2)		(1.7)
Curtailment loss	—		1.9
Total net periodic pension cost	$	2.1	$	4.4

Leases

Operating lease arrangements are comprised primarily of real estate and equipment agreements. The components of lease expense were as follows (in millions):

	Quarters Ended
	April 1, 2022		April 2, 2021
Operating lease	$	11.2	$	9.9
Variable lease	1.6		1.0
Short-term lease	0.4		0.7
Total lease expense	$	13.2	$	11.6

The lease liabilities recognized in the Consolidated Balance Sheets are as follows (in millions):

	As of
	April 1, 2022		December 31, 2021
Operating lease liabilities included in:
Accrued expenses and other current liabilities	$	35.1	$	32.5
Other long-term liabilities	137.9		142.4
Total	$	173.0	$	174.9
Operating ROU assets included in:
Other assets	$	169.7	$	170.1
Financing lease liabilities included in:
Accrued expenses and other current liabilities	$	12.7	$	12.7
Other long-term liabilities	10.2		10.2
Total	$	22.9	$	22.9
Financing ROU assets included in:
Other assets	$	21.9	$	22.3

As of April 1, 2022, the weighted-average remaining lease-terms were 8.3 years and 19.8 years and the weighted-average discount rates were 4.2% and 6.0% for operating and financing leases, respectively.

Supplemental Disclosure of Cash Flow Information

Certain of the Company's cash and non-cash activities were as follows (in millions):

	Quarters Ended
	April 1, 2022		April 2, 2021
Non-cash investing activities:
Capital expenditures in accounts payable and other long-term liabilities	$	225.4	$	180.9
Operating ROU assets obtained in exchange of lease liabilities	10.7		7.1
Cash paid for:
Interest expense	$	24.0	$	31.4
Income taxes	15.7		20.9
Operating lease payments in operating cash flows	11.0		10.3

Reconciliation of the captions in the Consolidated Balance Sheets to the Consolidated Statements of Cash Flows (in millions)

	As of
	April 1, 2022		December 31, 2021		April 2, 2021		December 31, 2020
Consolidated Balance Sheets:
Cash and cash equivalents	$	1,645.1	$	1,352.6	$	1,042.5	$	1,080.7
Restricted cash (included in other current assets)	18.8		20.1		1.4		0.8
Restricted cash (included in other non-current assets)	5.0		5.0		—		—
Cash, cash equivalents and restricted cash in Consolidated Statements of Cash Flows	$	1,668.9	$	1,377.7	$	1,043.9	$	1,081.5

As of April 1, 2022, $15.0 million of the restricted cash balance was held in escrow relating to the acquisition of GTAT and will be released to the former stockholders of GTAT upon satisfaction of certain outstanding items contained in the acquisition agreement.