Fair Values of Financial Instruments (Tables)

9 Months Ended

Sep. 27, 2020

Fair Value Disclosures [Abstract]

Methods and Assumptions Used in Estimating Fair Value

The below methods and assumptions were used by the Company in estimating the fair values of its financial instruments. There were no transfers of assets or liabilities between levels in any period presented.

Financial Instrument	Fair Value Level	Methods and Assumptions
Deferred compensation plan assets and liabilities	Level 1	The fair value of the Company’s nonqualified deferred compensation plan for certain executives and other highly compensated employees is based on the fair values of associated assets and liabilities, which are held in mutual funds and are based on the quoted market values of the securities held within the mutual funds.
Commodity derivative instruments	Level 2	The fair values of the Company’s commodity derivative instruments are based on current settlement values at each balance sheet date, which represent the estimated amounts the Company would have received or paid upon termination of these instruments. The Company’s credit risk related to the commodity derivative instruments is managed by requiring high standards for its counterparties and periodic settlements. The Company considers nonperformance risk in determining the fair values of commodity derivative instruments.
Nonpublic variable rate debt	Level 2	The carrying amounts of the Company’s nonpublic variable rate debt approximate the fair values due to variable interest rates with short reset periods.
Nonpublic fixed rate debt	Level 2	The fair values of the Company’s nonpublic fixed rate debt are based on estimated current market prices.
Public debt securities	Level 2	The fair values of the Company’s public debt securities are based on estimated current market prices.
Acquisition related contingent consideration	Level 3	The fair value of the Company’s acquisition related contingent consideration is based on internal forecasts and the weighted average cost of capital (“WACC”) derived from market data.

Deferred Compensation Plan, Commodity Derivative Instruments, Debt and Acquisition Related Contingent Consideration

The following tables summarize the carrying amounts and fair values by level of the Company’s deferred compensation plan, commodity derivative instruments, debt and acquisition related contingent consideration:

	September 27, 2020
(in thousands)	Carrying Amount		Total Fair Value		Fair Value Level 1		Fair Value Level 2		Fair Value Level 3
Assets:
Deferred compensation plan assets	$	46,602	$	46,602	$	46,602	$	—	$	—
Commodity derivative instruments	1,049		1,049		—		1,049		—
Liabilities:
Deferred compensation plan liabilities	46,602		46,602		46,602		—		—
Commodity derivative instruments	1,376		1,376		—		1,376		—
Nonpublic variable rate debt	239,882		240,000		—		240,000		—
Nonpublic fixed rate debt	374,747		402,500		—		402,500		—
Public debt securities	348,238		390,200		—		390,200		—
Acquisition related contingent consideration	448,653		448,653		—		—		448,653

	December 29, 2019
(in thousands)	Carrying Amount		Total Fair Value		Fair Value Level 1		Fair Value Level 2		Fair Value Level 3
Assets:
Deferred compensation plan assets	$	42,543	$	42,543	$	42,543	$	—	$	—
Commodity derivative instruments	1,007		1,007		—		1,007		—
Liabilities:
Deferred compensation plan liabilities	42,543		42,543		42,543		—		—
Commodity derivative instruments	1,174		1,174		—		1,174		—
Nonpublic variable rate debt	307,250		307,500		—		307,500		—
Nonpublic fixed rate debt	374,723		383,900		—		383,900		—
Public debt securities	347,947		367,300		—		367,300		—
Acquisition related contingent consideration	446,684		446,684		—		—		446,684

Summary of Acquisition Related Contingent Consideration Liability

The acquisition related contingent consideration liability is the Company’s only Level 3 asset or liability. A summary of the Level 3 activity is as follows:

	Third Quarter				First Nine Months
(in thousands)	2020		2019		2020		2019
Beginning balance - Level 3 liability	$	441,113	$	412,450	$	446,684	$	382,898
Payments of acquisition related contingent consideration	(11,468)		(5,948)		(31,999)		(18,784)
Reclassification to current payables	(800)		(60)		(1,100)		(940)
Increase in fair value	19,808		18,749		35,068		62,017
Ending balance - Level 3 liability	$	448,653	$	425,191	$	448,653	$	425,191