Segment Information

9 Months Ended

Sep. 28, 2019

We report our segment information in the same way management internally organizes the business in assessing performance and making decisions regarding allocation of resources in accordance with ASC 280-10- Segment Reporting. We determined that we have three reportable segments, organized and managed principally by geographic region. Our reportable segments are North America, Europe and Australasia. We report all other business activities in Corporate and unallocated costs. Factors considered in determining the three reportable segments include the nature of business activities, the management structure accountable directly to the CODM, the discrete financial information available and the information regularly reviewed by the CODM. Management reviews net revenues and Adjusted EBITDA to evaluate segment performance and allocate resources. We define Adjusted EBITDA as net income (loss), adjusted for the following items: loss from discontinued operations, net of tax; equity earnings of non-consolidated entities; income tax (benefit) expense; depreciation and amortization; interest expense, net; impairment and restructuring charges; gain on previously held shares of equity investment; (gain) loss on sale of property and equipment; share-based compensation expense; non-cash foreign exchange transaction/translation (income) loss; other non-cash items; other items; and costs related to debt restructuring and debt refinancing.

The following tables set forth certain information relating to our segments’ operations:



(amounts in thousands)	North America			Europe			Australasia			Total Operating Segments			Corporate and Unallocated Costs			Total Consolidated
Three Months Ended September 28, 2019
Total net revenues	$	658,705		$	287,703		$	148,281		$	1,094,689		$	—		$	1,094,689
Intersegment net revenues	(268		)	(13		)	(2,455		)	(2,736		)	—			(2,736		)
Net revenues from external customers	$	658,437		$	287,690		$	145,826		$	1,091,953		$	—		$	1,091,953
Impairment and restructuring charges	$	1,133		$	2,258		$	4,513		$	7,904		$	31		$	7,935
Adjusted EBITDA	$	66,671		$	30,184		$	20,343		$	117,198		$	(8,250	)	$	108,948
Three Months Ended September 29, 2018
Total net revenues	$	667,915		$	292,975		$	179,659		$	1,140,549		$	—		$	1,140,549
Intersegment net revenues	(206		)	(66		)	(3,799		)	(4,071		)	—			(4,071		)
Net revenues from external customers	$	667,709		$	292,909		$	175,860		$	1,136,478		$	—		$	1,136,478
Impairment and restructuring charges	$	2,233		$	1,053		$	318		$	3,604		$	287		$	3,891
Adjusted EBITDA	$	84,286		$	27,713		$	26,192		$	138,191		$	(5,562	)	$	132,629



(amounts in thousands)	North America			Europe			Australasia			Total Operating Segments			Corporate and Unallocated Costs			Total Consolidated
Nine Months Ended September 28, 2019
Total net revenues	$	1,893,273		$	888,174		$	447,004		$	3,228,451		$	—		$	3,228,451
Intersegment net revenues	(1,358		)	(133		)	(5,760		)	(7,251		)	—			(7,251		)
Net revenues from external customers	$	1,891,915		$	888,041		$	441,244		$	3,221,200		$	—		$	3,221,200
Impairment and restructuring charges	$	5,281		$	4,210		$	6,932		$	16,423		$	965		$	17,388
Adjusted EBITDA	$	206,985		$	86,810		$	57,981		$	351,776		$	(25,968	)	$	325,808
Nine Months Ended September 29, 2018
Total net revenues	$	1,839,710		$	914,222		$	512,656		$	3,266,588		$	—		$	3,266,588
Intersegment net revenues	(885		)	(930		)	(9,665		)	(11,480		)	—			(11,480		)
Net revenues from external customers	$	1,838,825		$	913,292		$	502,991		$	3,255,108		$	—		$	3,255,108
Impairment and restructuring charges	$	4,425		$	1,758		$	4,068		$	10,251		$	(873	)	$	9,378
Adjusted EBITDA	$	210,958		$	97,340		$	66,978		$	375,276		$	(22,123	)	$	353,153

Reconciliations of net income to Adjusted EBITDA are as follows:



	Three Months Ended						Nine Months Ended
(amounts in thousands)	September 28, 2019			September 29, 2018			September 28, 2019		September 29, 2018
Net income	$	17,042		$	28,637		$	55,175	$	103,817
Equity earnings of non-consolidated entities	—			—			—		(738		)
Income tax expense	22,500			(31,686		)	45,030		(13,141		)
Depreciation and amortization	34,921			31,248			99,749		90,279
Interest expense, net	17,571			18,341			53,719		51,832
Impairment and restructuring charges	7,935			3,891			17,388		9,378
Gain on previously held shares of equity investment	—			—			—		(20,767		)
Loss (gain) on sale of property and equipment	1			(119		)	1,081		154
Share-based compensation expense	4,108			4,133			10,585		12,374
Non-cash foreign exchange transaction/translation (income) loss	(182		)	2,840			3,615		(359		)
Other items⁽¹⁾	5,052			75,154			38,732		107,868
Other non-cash items ⁽²⁾	—			—			734		12,191
Costs relating to debt restructuring and debt refinancing	—			190			—		265
Adjusted EBITDA	$	108,948		$	132,629		$	325,808	$	353,153

(1)

Other non-recurring items not core to ongoing business activity include: (i) in the three months ended September 28, 2019 (1) $3,599 in legal and professional fees relating primarily to litigation, (2) $(3,021) of realized gains on hedges of intercompany notes, (3) $2,839 in facility closure and consolidation costs related to our facility footprint rationalization program, and (4) $1,435 in acquisition and integration costs; (ii) in the three months ended September 29, 2018 (1) $76,500 in litigation contingency accruals, (2) $(3,700) of realized gains on hedges of intercompany notes, and (3) $1,790 in acquisition and integration costs; (iii) in the nine months ended September 28, 2019 (1) $16,877 in facility closure and consolidation costs related to our facility footprint rationalization program, (2) $13,432 in acquisition and integration costs including $7,077 related to purchase price structured by the former owners as retention payments for key employees at a recent acquisition, (3) $9,922 in legal cost and professional fees relating primarily to litigation, (4) $(3,053) of realized gains on hedges of intercompany notes, (5) $842 in other miscellaneous costs, and (6) $625 in costs related to the departure of former executives; (iv) in the nine months ended September 29, 2018 (1) $76,500 in litigation contingency accruals, (2) $25,372 in legal and professional fees relating primarily to litigation, (3) $5,954 in acquisition and integration costs, (4) $(3,700) of realized gains on hedges of intercompany notes, (5) $2,776 in costs related to the departure of former executives, and (6) $445 in stock compensation payroll taxes.


(2)	Other non-cash items include: (i) in the nine months ended September 28, 2019, $734 for inventory adjustments; (ii) in the nine months ended September 29, 2018, $12,191 for initial inventory adjustments related to the ABS acquisition.

The prior period information has been revised and reclassified to conform with current period presentation. Please refer to Note 27-Revision of Prior Period Financial Statements.