XML 31 R21.htm IDEA: XBRL DOCUMENT v3.21.1
SEGMENT REPORTING
 6 Months Ended
Apr. 25, 2021
Segment Reporting [Abstract]  
SEGMENT REPORTING SEGMENT REPORTING
 
The Company develops, processes, and distributes a wide array of food products in a variety of markets. The Company reports its results in the following four segments: Grocery Products, Refrigerated Foods, Jennie-O Turkey Store, and International & Other.
 
The Grocery Products segment consists primarily of the processing, marketing, and sale of shelf-stable food products sold predominantly in the retail market, along with the sale of nutritional and private label shelf-stable products to retail, foodservice, and industrial customers. This segment also includes the results from the Company’s MegaMex Foods, LLC joint venture.
 
The Refrigerated Foods segment consists primarily of the processing, marketing, and sale of branded and unbranded pork, beef, and poultry products for retail, foodservice, deli, and commercial customers.
 
The Jennie-O Turkey Store segment consists primarily of the processing, marketing, and sale of branded and unbranded turkey products for retail, foodservice, and commercial customers.
 
The International & Other segment includes Hormel Foods International which manufactures, markets, and sells Company products internationally. This segment also includes the results from the Company’s international joint ventures and royalty arrangements.
 
Intersegment sales are recorded at prices that approximate cost and are eliminated in the Consolidated Statements of Operations. The Company does not allocate deferred compensation, investment income, interest expense, or interest income to its segments when measuring performance. The Company also retains various other income and expenses at the corporate level. Equity in Earnings of Affiliates is included in segment profit; however, earnings attributable to the Company’s noncontrolling interests are excluded. These items are included below as Net Unallocated Expense and Noncontrolling Interest when reconciling to Earnings Before Income Taxes.
 
Sales and operating profits for each of the Company’s reportable segments and reconciliation to Earnings Before Income Taxes are set forth below. The Company is an integrated enterprise, characterized by substantial intersegment cooperation, cost allocations, and sharing of assets. Therefore, the Company does not represent that these segments, if operated independently, would report the profit and other financial information shown below.
 
 Thirteen Weeks EndedTwenty-Six Weeks Ended
(in thousands)April 25, 2021April 26, 2020April 25, 2021April 26, 2020
Sales to Unaffiliated Customers  
Grocery Products$628,232 $683,250 $1,205,831 $1,223,876 
Refrigerated Foods1,453,380 1,247,336 2,820,457 2,599,127 
Jennie-O Turkey Store351,179 343,056 684,500 673,183 
International & Other173,830 148,823 356,980 310,714 
Total$2,606,621 $2,422,465 $5,067,768 $4,806,899 
Intersegment Sales
Grocery Products$— $6 $— $13 
Refrigerated Foods5,933 5,248 11,891 11,051 
Jennie-O Turkey Store32,442 28,878 59,135 56,720 
International & Other— — — — 
Total38,376 34,132 71,026 67,784 
Intersegment Elimination(38,376)(34,132)(71,026)(67,784)
Total$— $— $— $— 
Net Sales
Grocery Products$628,232 $683,256 $1,205,831 $1,223,889 
Refrigerated Foods1,459,313 1,252,584 2,832,348 2,610,178 
Jennie-O Turkey Store383,621 371,934 743,635 729,903 
International & Other173,830 148,823 356,980 310,714 
Intersegment Elimination(38,376)(34,132)(71,026)(67,784)
Total$2,606,621 $2,422,465 $5,067,768 $4,806,899 
Segment Profit
Grocery Products$97,970 $127,763 $190,172 $196,198 
Refrigerated Foods173,352 131,431 314,524 298,775 
Jennie-O Turkey Store12,700 27,348 39,640 65,899 
International & Other24,481 23,164 56,685 43,115 
Total Segment Profit308,503 309,706 601,020 603,986 
Net Unallocated Expense15,904 23,098 31,451 27,297 
Noncontrolling Interest21 (119)133 (39)
Earnings Before Income Taxes$292,620 $286,489 $569,702 $576,651 

Revenue has been disaggregated into the categories below to show how sales channels affect the nature, amount, timing, and uncertainty of revenue and cash flows. The amount of total revenues contributed by sales channel are:
 Thirteen Weeks EndedTwenty-Six Weeks Ended
(in thousands)April 25, 2021April 26, 2020April 25, 2021April 26, 2020
U.S. Retail$1,454,088 $1,455,652 $2,844,716 $2,682,082 
U.S. Foodservice724,248 566,814 1,310,584 1,275,920 
U.S. Deli231,543 223,034 510,802 483,672 
International196,742 176,966 401,666 365,226 
Total$2,606,621 $2,422,465 $5,067,768 $4,806,899 

The improvement demonstrated in U.S. Foodservice in the thirteen weeks ended April 25, 2021, was driven by recovery of the foodservice industry following restrictions imposed by the COVID-19 pandemic in fiscal 2020.
The Company’s products primarily consist of meat and other food products. The amount of total revenues contributed by classes of similar products are: 
 Thirteen Weeks EndedTwenty-Six Weeks Ended
(in thousands)April 25, 2021April 26, 2020April 25, 2021April 26, 2020
Perishable$1,453,149 $1,250,330 $2,829,969 $2,650,525 
Shelf-stable567,501 619,353 1,091,437 1,070,058 
Poultry494,186 482,959 968,837 942,041 
Miscellaneous91,786 69,823 177,525 144,275 
Total$2,606,621 $2,422,465 $5,067,768 $4,806,899 

Perishable includes fresh meats, frozen items, refrigerated meal solutions, sausages, hams, guacamole, and bacon (excluding Jennie-O Turkey Store products). Shelf-stable includes canned luncheon meats, nut butters, chilies, shelf-stable microwaveable meals, hash, stews, salsas, tortilla chips, and other items that do not require refrigeration. The Poultry category is composed primarily of Jennie-O Turkey Store products. The Miscellaneous category primarily consists of nutritional food products and supplements, dessert and drink mixes, and industrial gelatin products.