PROPERTY, PLANT AND EQUIPMENT

12 Months Ended

Dec. 28, 2014

Property, Plant and Equipment [Abstract]

PROPERTY, PLANT AND EQUIPMENT

PROPERTY, PLANT AND EQUIPMENT

Property, plant and equipment (“PP&E”), net consisted of the following:

	December 28, 2014			December 29, 2013
	(In thousands)
Land	$	66,798		$	66,071
Buildings	1,086,690			1,077,859
Machinery and equipment	1,537,241			1,502,968
Autos and trucks	52,639			55,779
Construction-in-progress	129,701			66,926
Property, plant and equipment, gross	2,873,069			2,769,603
Accumulated depreciation	(1,690,274		)	(1,617,792		)
Property, plant and equipment, net	$	1,182,795		$	1,151,811

The Company recognized depreciation expense of $136.4 million, $135.5 million and $131.5 million during 2014, 2013 and 2012, respectively.

During 2014, the Company sold certain PP&E for cash of $11.1 million and recognized a gain of $1.4 million. PP&E sold in 2014 included a warehouse in Texas, vehicle maintenance centers in Texas and North Carolina, an office building in Mexico City, a processing plant in Pennsylvania, and a fertilizer building with miscellaneous fixtures and equipment in Texas. During 2013, the Company sold certain PP&E for cash of $31.3 million and recognized a loss of $2.4 million. PP&E sold in 2013 included vehicle maintenance centers in Texas, Arkansas, and Georgia, excess land in Texas, a hatchery in North Carolina, a complex in Arkansas, an office building in Georgia, and miscellaneous equipment.

During 2014, the Company spent $171.4 million on capital projects and transferred $110.1 million of completed projects from construction-in-progress to depreciable assets.

The Company has closed or idled processing facilities in Alabama, Georgia, Arkansas and Texas, feed mills in North Carolina and Arkansas, hatcheries in Alabama, Texas, and Arkansas, various broiler farms in Texas and Alabama, a vehicle maintenance center in Arkansas and other miscellaneous assets. Neither the Board of Directors nor JBS USA has determined if it would be in the best interest of the Company to divest any of these idled assets. Management is therefore not certain that it can or will divest any of these assets within one year, is not actively marketing these assets and, accordingly, has not classified them as assets held for sale. The Company continues to depreciate these assets. At December 28, 2014, the carrying amount of these idled assets was $69.3 million based on depreciable value of $181.3 million and accumulated depreciation of $112.0 million.

Management has committed to the sale of certain properties and related assets, including, but not limited to, a processing plant in Bossier City, Louisiana and miscellaneous assets, as such assets no longer fit into the operating plans of the Company. The Company is actively marketing these properties and related assets for immediate sale and believes a sale of each property can be consummated within the next 12 months. At December 28, 2014, the Company reported assets held for sale totaling $1.4 million in Assets held for sale on its Consolidated Balance Sheets.

The Company tested the recoverability of its long-lived assets held for use during the thirteen weeks ended December 28, 2014 by comparing the book value of its invested capital, exclusive of assets held for sale, with the undiscounted cash flows expected to result from the use and eventual disposition of its long-lived assets held for use. The Company determined that the carrying amount of its long-lived assets held for use is recoverable over the remaining life of the primary asset in the group, and the long-lived assets for use pass the Step 1 recoverability test of ASC 360-10-35, Impairment or Disposal of Long-Lived Assets.